Exam 2: Building Blocks of Managerial Accounting

Which of the following are merchandising companies?

Uniquely Me Shoppe,a clothing retailer,had the following total costs as grouped by value chain element: Research and development \ 53,000 Design \ 17,000 Purchases \ 99,000 Marketing \ 42,000 Distribution \ 68,000 Custumer service \ 27,000 - What were the company's inventoriable costs?

Olde Tyme Beverage Company's operating activities for the year are listed below. Purcheses \ 132,000 Operating expenses 80,000 Bepinging inventory 12,000 Ending inventory 16,000 Sales revenue 275,000 -What is the cost of goods available for sale?

Sunnybrook Orange Groves processes a variety of fresh juices.The company has the following expenses for July: Depreciation expense an bottling machines \ 63,000 Glass juice bottles \ 54,000 Comrissions for salespeople \ 27,000 Salaries of mutrition researchers \ 89,000 Costs of maintaining website used for custamer orders \ 4,000 Wages of factory workers \ 75,000 Freshess seals/caps for juice battles \ 3,000 Reconfiguring the factory layout \ 102,000 Custamer help line \ 2,000 Costs of refrigerated trucks used to deliver juice \ 17,000 -What is the total cost for the production category of the value chain?

A company is deciding whether to purchase production equipment which can produce units more quickly than the current equipment.Which of the following costs would be relevant to its decision?

Which of the following describes the way fixed costs per unit behave?

Use the appropriate letter(s)to indicate if the following costs would be found on the income statement of a: A)service company. B)merchandising company. C)manufacturing company. You may use more than one letter for each answer. ____ Revenue ____ Salaries expense ____ Customer service expense ____ Cost of goods manufactured ____ Cost of goods sold

When determining the cost of a manufactured product,a salesperson's salary would be classified as:

Comfy Furniture Company manufactures furniture at its Akron,Ohio,factory.Some of its costs from the past year include: Depreciation on sales office \ 11,000 Depreciation on factory equipment \ 16,000 Factory supervisor salary \ 52,500 Sales commissions \ 23,000 Lubricants used in factory equipment \ 3,000 Insurance costs for factory \ 21,000 Wages paid to maintenance workers \ 115,000 Fabric used to upholster furniture \ 7,000 Freight-in (on raw materials) \ 2,500 Costs of delivery to customers \ 9,000 Wages paid to assembly-line workers \ 132,500 Lumber used to build product \ 72,000 Utilities in factory \ 44,500 Utilities in sales office \&26,500 - Period costs for Comfy Furniture Company totaled:

Towpath Tennis & Recreation's operating activities for the year are listed below. Purcheses \ 150,000 Operating expenses 62,000 Bepinging inventory 27,000 Ending inventory 32,000 Sales revenue 302,000 -What is the cost of goods sold for the year?

A(n)____________ cost is one whose total amount changes in direct proportion to a change in volume.

Which of the following is an example of a fixed cost for a manufacturer?

Manufacturers consider selling and administrative costs to be:

Differentiate between fixed and variable costs and give an example of each.

Summerville Company sells office supplies.The following information summarizes the company's operating activities for the year: Utilities far the stare \8 ,000 Sales comrissions 11,000 Sales revenue 151,000 Purchases of merchandise 73,000 January 1 inventary 27,000 Rent for stare 12,000 December 31 inventory 23,000 - What is total operating expense?

Comfy Furniture Company manufactures furniture at its Akron,Ohio,factory.Some of its costs from the past year include: Depreciation on sales office \ 11,000 Depreciation on factory equipment \ 16,000 Factory supervisor salary \ 52,500 Sales commissions \ 23,000 Lubricants used in factory equipment \ 3,000 Insurance costs for factory \ 21,000 Wages paid to maintenance workers \ 115,000 Fabric used to upholster furniture \ 7,000 Freight-in (on raw materials) \ 2,500 Costs of delivery to customers \ 9,000 Wages paid to assembly-line workers \ 132,500 Lumber used to build product \ 72,000 Utilities in factory \ 44,500 Utilities in sales office \ 26,500 -Direct material costs for Comfy Furniture Company totaled:

The following information is available for the Petree Corporation for last year: -Raw materials inventory decreased $4,000 from the beginning of the year to the end of the year. -Raw materials inventory on December 31 (end of year)was 50% of raw materials inventory on January 1 (beginning of year). -Beginning work in process inventory was $145,000. -Ending finished goods inventory was $65,000. -Purchases of direct materials were $154,700. -Manufacturing overhead was 50% of the cost of direct labor. -Total manufacturing costs incurred were $246,400,80% of cost of goods manufactured and $156,000 less than cost of goods sold. Compute: a)Finished goods inventory on January 1 (beginning of year) b)Work in process inventory on December 31 (end of year) c)Direct labor incurred d)Manufacturing overhead incurred e)Direct materials used f)Raw materials inventory on January 1 (beginning of year) g)Raw materials inventory on December 31 (end of year) Note to students: The solutions to this problem are not necessarily calculated in alphabetical order.

Which of the following describes the way in which total fixed costs behave?

A company has monthly fixed costs of $112,000.The variable costs are $5.00 per unit.If the sales price of a unit is $20.00 and we sell 8,000 units,the company's total variable costs will be:

Readers Unlimited sells books.The following information summarizes the company's operating expenses for the year: Purchases \ 90,000 Operating expenses 53,000 Bepinning merchandise inventary 12,000 Ending merchandise inventory 15,000 Sales revenue 172,000 - What is cost of goods available for sale?