Question 1

Which one of the following items is normally not a manufacturing cost?

Accepted Answer

A)  Direct labor. 
B)  Factory overhead. 
C)  General and administrative expenses. 
D)  Direct materials. 
E)  Conversion cost. 
A)  Direct labor. 
B)  Factory overhead. 
C)  General and administrative expenses. 
D)  Direct materials. 
E)  Conversion cost.

Question 2

Prime costs consist of direct labor and factory overhead.

Accepted Answer

A) True 
 B)False

Question 3

Continuous improvement:

Accepted Answer

A)  Is not applicable to most businesses. 
B)  Strives to preserve acceptable levels of performance. 
C)  Is possible only in service businesses. 
D)  Encourages employees to maintain established business practices. 
E)  Rejects the notion of "good enough." 
A)  Is not applicable to most businesses. 
B)  Strives to preserve acceptable levels of performance. 
C)  Is possible only in service businesses. 
D)  Encourages employees to maintain established business practices. 
E)  Rejects the notion of "good enough."

Question 4

Although direct labor and raw materials costs are treated as manufacturing costs and therefore make up part of the finished goods inventory cost, factory overhead is charged to expense as it is incurred because it is a period cost.

Accepted Answer

A) True 
 B)False

Question 5

Using the information below for Sundar Company; determine the cost of goods manufactured during the current year: $$\begin{array} { l | c } 
\text { Direct materials used } & \$ 19,000 \
\hline \text { Direct labor used } & 24,500 \
\hline \text { Factory overhead } & 55,100 \
\hline \text { Beginning work in process } & 10,700 \
\hline \text { Ending work in process } & 11,300
\end{array}$$

Accepted Answer

A)  $79,000. 
B)  $98,600. 
C)  $43,500. 
D)  $98,000. 
E)  $42,900. 
A)  $79,000. 
B)  $98,600. 
C)  $43,500. 
D)  $98,000. 
E)  $42,900.

Question 6

Match between columns
                        Premises:  Prime costs
 Continuous improvement
 Raw materials inventory
 Balanced scorecard
 Just-in-time manufacturing
 Work in Process inventory
 Lean business model
 Customer orientation
 Managerial accounting
 Raw materials inventory turnover

Accepted Answer

The Answer of An idea that rejects the notions of is...

Question 7

Using the information below, compute the raw materials inventory turnover: $\begin{array}{lr}
\text { Raw Materials Used } & \$ 121,600 \
\
\text { Beginning Raw Materials Inventory } & 18,000 \
\text { Ending Raw Materials Inventory } & 20,200
\end{array}$

Accepted Answer

A)  60.6. 
B)  54.0. 
C)  6.76. 
D)  6.37. 
E)  6.02. 
A)  60.6. 
B)  54.0. 
C)  6.76. 
D)  6.37. 
E)  6.02.

Question 8

Materials that are used in manufacturing but are not clearly identified with specific product units are called:

Accepted Answer

A)  Indirect materials. 
B)  Secondary materials. 
C)  General materials. 
D)  Materials inventory. 
E)  Direct materials. 
A)  Indirect materials. 
B)  Secondary materials. 
C)  General materials. 
D)  Materials inventory. 
E)  Direct materials.

Question 9

Feedback provided by the control function allows managers to revise their plans.

Accepted Answer

A) True 
 B)False

Question 10

What are the components of the schedule of cost of goods manufactured? Describe each component.

Accepted Answer

The components of the schedule of cost o

Question 11

________ is the process of setting goals and making plans to achieve them.

Accepted Answer

The answer of ________ is the process of setting goals...

Question 12

Goods a company acquires to use in making products are called:

Accepted Answer

A)  Finished goods inventory. 
B)  Work in process inventory. 
C)  Conversion costs. 
D)  Cost of goods sold. 
E)  Raw materials inventory. 
A)  Finished goods inventory. 
B)  Work in process inventory. 
C)  Conversion costs. 
D)  Cost of goods sold. 
E)  Raw materials inventory.

Question 13

Comet Company accumulated the following account information for the year: Beginning raw materials inventory$6,000 $$\begin{array} {| l | l |} 
\hline\text { Indirect materials cost } & 2,000 \
\hline \text { Indirect labor cost } & 5,000 \
\hline \text { Maintenance \& factory equipment } & 2,800 \
\hline \text { Direct labor cost } & 7,000\
\hline
\end{array}$$  Using the above information, total factory overhead costs would be:

Accepted Answer

A)  $13,000. 
B)  $9,800. 
C)  $15,800. 
D)  $7,800. 
E)  $16,800. 
A)  $13,000. 
B)  $9,800. 
C)  $15,800. 
D)  $7,800. 
E)  $16,800.

Question 14

Manufacturing costs other than direct materials and direct labor, and are not readily traceable to specific units or batches of production are called:

Accepted Answer

A)  Factory overhead. 
B)  Prime costs. 
C)  Administrative expenses. 
D)  Nonmanufacturing costs. 
E)  Preproduction costs. 
A)  Factory overhead. 
B)  Prime costs. 
C)  Administrative expenses. 
D)  Nonmanufacturing costs. 
E)  Preproduction costs.

Question 15

What is managerial accounting and how is it used to aid decision makers?

Accepted Answer

Managerial accounting is an activity tha

Question 16

The model whose goal is to eliminate waste while satisfying the customer and providing a positive return to the company is:

Accepted Answer

A)  Managerial accounting model. 
B)  Lean business model. 
C)  Just-in-time manufacturing model. 
D)  Corporate social responsibility model. 
E)  Continuous improvement model. 
A)  Managerial accounting model. 
B)  Lean business model. 
C)  Just-in-time manufacturing model. 
D)  Corporate social responsibility model. 
E)  Continuous improvement model.

Question 17

Brotherton Company is a manufacturer of Blu-ray discs. Place each of the following costs in the appropriate column.

Accepted Answer

The answer of Brotherton Company is a manufacturer of Blu-ray...

Question 18

Which of the following costs is not included in factory overhead?

Accepted Answer

A)  Manufacturing supplies used. 
B)  Indirect labor. 
C)  Depreciation of manufacturing equipment. 
D)  Direct materials. 
E)  Payroll taxes on the wages of factory supervisors. 
A)  Manufacturing supplies used. 
B)  Indirect labor. 
C)  Depreciation of manufacturing equipment. 
D)  Direct materials. 
E)  Payroll taxes on the wages of factory supervisors.

Question 19

A fixed cost:

Accepted Answer

A)  Does not change with changes in the volume of activity within the relevant range. 
B)  Changes with changes in the volume of activity within the relevant range. 
C)  Requires the future outlay of cash and is relevant for future decision making. 
D)  Is directly traceable to a cost object. 
E)  Is irrelevant for cost-volume-profit and short-term decision making. 
A)  Does not change with changes in the volume of activity within the relevant range. 
B)  Changes with changes in the volume of activity within the relevant range. 
C)  Requires the future outlay of cash and is relevant for future decision making. 
D)  Is directly traceable to a cost object. 
E)  Is irrelevant for cost-volume-profit and short-term decision making.

Question 20

Craigmont Company's direct materials costs are $3,000,000, its direct labor costs total $7,000,000, and its factory overhead costs total $5,000,000. 
-Its prime costs total:

Accepted Answer

A)  $8,000,000. 
B)  $15,000,000. 
C)  $10,000,000. 
D)  $5,000,000. 
E)  $12,000,000. 
A)  $8,000,000. 
B)  $15,000,000. 
C)  $10,000,000. 
D)  $5,000,000. 
E)  $12,000,000.

Exam 18: Managerial Accounting Concepts and Principles

Which one of the following items is normally not a manufacturing cost?

Prime costs consist of direct labor and factory overhead.

Continuous improvement:

Although direct labor and raw materials costs are treated as manufacturing costs and therefore make up part of the finished goods inventory cost, factory overhead is charged to expense as it is incurred because it is a period cost.

Using the information below for Sundar Company; determine the cost of goods manufactured during the current year: Direct materials used \ 19,000 Direct labor used 24,500 Factory overhead 55,100 Beginning work in process 10,700 Ending work in process 11,300

Using the information below, compute the raw materials inventory turnover: Raw Materials Used \ 121,600 Beginning Raw Materials Inventory 18,000 Ending Raw Materials Inventory 20,200

Materials that are used in manufacturing but are not clearly identified with specific product units are called:

Feedback provided by the control function allows managers to revise their plans.

What are the components of the schedule of cost of goods manufactured? Describe each component.

________ is the process of setting goals and making plans to achieve them.

Goods a company acquires to use in making products are called:

Manufacturing costs other than direct materials and direct labor, and are not readily traceable to specific units or batches of production are called:

What is managerial accounting and how is it used to aid decision makers?

The model whose goal is to eliminate waste while satisfying the customer and providing a positive return to the company is:

Brotherton Company is a manufacturer of Blu-ray discs. Place each of the following costs in the appropriate column.

Which of the following costs is not included in factory overhead?

A fixed cost:

Craigmont Company's direct materials costs are $3,000,000, its direct labor costs total $7,000,000, and its factory overhead costs total $5,000,000. -Its prime costs total:

Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts and Preparing Financial Statements

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories and Cost of Sales

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Plant Assets Natural Resoures and Intangibles

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments

Reporting the Statement of Cash Flows

Analysis of Financial Statements

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets and Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Capital Budgeting and Managerial Decisions

Present and Future Values in Accounting

Activity-Based Costing

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