Question 1

Which of the following items appears only in a manufacturing company's financial statements?

Accepted Answer

A)  Goods available for sale. 
B)  Cost of goods manufactured. 
C)  Net income. 
D)  Gross profit. 
E)  Cost of goods sold. 
A)  Goods available for sale. 
B)  Cost of goods manufactured. 
C)  Net income. 
D)  Gross profit. 
E)  Cost of goods sold.

Question 2

The schedule of cost of goods manufactured is also known as a manufacturing statement.

Accepted Answer

A) True 
 B)False

Question 3

One of the usual differences between financial and managerial accounting is the timeliness of the information reported.

Accepted Answer

A) True 
 B)False

Question 4

Using the information below, compute the Days' sales in raw materials inventory: $\begin{array}{lr}
\text { Raw Materials Used } & \$ 85,500 \
\text { Beginning Raw Materials Inventory } & 8,000 \
\text { Ending Raw Materials Inventory } & 9,000
\end{array}$

Accepted Answer

A)  9.94. 
B)  36.3. 
C)  38.4. 
D)  10.06. 
E)  11.02. 
A)  9.94. 
B)  36.3. 
C)  38.4. 
D)  10.06. 
E)  11.02.

Question 5

Raw materials inventory should not include indirect materials.

Accepted Answer

A) True 
 B)False

Question 6

The three major cost components of manufacturing a product are:

Accepted Answer

A)  Marketing, selling, and administrative costs. 
B)  General, selling, and administrative costs. 
C)  Direct materials, direct labor, and factory overhead. 
D)  Product costs, period costs, and variable costs. 
E)  Indirect labor, indirect materials, and fixed expenses. 
A)  Marketing, selling, and administrative costs. 
B)  General, selling, and administrative costs. 
C)  Direct materials, direct labor, and factory overhead. 
D)  Product costs, period costs, and variable costs. 
E)  Indirect labor, indirect materials, and fixed expenses.

Question 7

Total quality management (TQM) is a system that acquires inventory and produces only when needed.

Accepted Answer

A) True 
 B)False

Question 8

If beginning and ending work in process inventories are $5,000 and $15,000, respectively, and cost of goods manufactured is $170,000, what is the total manufacturing cost for the period?

Accepted Answer

A)  $165,000. 
B)  $180,000. 
C)  $175,000. 
D)  $160,000. 
E)  $155,000. 
A)  $165,000. 
B)  $180,000. 
C)  $175,000. 
D)  $160,000. 
E)  $155,000.

Question 9

Calculate the cost of goods manufactured using the following 
information:$\begin{array} { l c } 
\text { Direct materials } & \$ 298,500 \
\text { Direct labor } & 132,000 \
\text { Factory overhead costs } & 264,000 \
\text { General and administrative expenses } & 85,500 \
\text { Selling expenses } & 48,800 \
\text { Work in Process inventory, January } & 1118,500 \
\text { Work in Process inventory, December 31 } & 125,900 \
\text { Finished goods inventory, January 1 } & 232,100 \
\text { Finished goods inventory, December 31 } & 238,700
\end{array}$

Accepted Answer

A)  $772,600. 
B)  $701,900. 
C)  $680,500. 
D)  $687,100. 
E)  $674,600. 
A)  $772,600. 
B)  $701,900. 
C)  $680,500. 
D)  $687,100. 
E)  $674,600.

Question 10

Using the information below for Laurels Company; determine the cost of goods manufactured during the current year: $$\begin{array} { l | r } 
\text { Direct materials used } & \$ 5 , 0 0 0 \
\hline \text { Direct Labor } & 7,000 \
\hline \text { Total Factory overhead } & 5,100 \
\hline \text { Beginning work in process } & 3,000 \
\hline \text { Ending work in process } & 4,000
\end{array}$$

Accepted Answer

A)  $17,100. 
B)  $16,100. 
C)  $13,600. 
D)  $12,000. 
E)  $18,100. 
A)  $17,100. 
B)  $16,100. 
C)  $13,600. 
D)  $12,000. 
E)  $18,100.

Question 11

A management concept based on an understanding of the changing wants and needs of customers, and which leads to flexible product designs and production processes, is called:

Accepted Answer

A)  Customer orientation. 
B)  Just-in-time. 
C)  Total quality management. 
D)  Continuous improvement. 
E)  Theory of constraints. 
A)  Customer orientation. 
B)  Just-in-time. 
C)  Total quality management. 
D)  Continuous improvement. 
E)  Theory of constraints.

Question 12

Goals of a Total Quality Management process include all of the following except:

Accepted Answer

A)  Continuous improvement. 
B)  Better inventory control. 
C)  Fewer product defects. 
D)  Reduced waste. 
E)  Consistent production levels. 
A)  Continuous improvement. 
B)  Better inventory control. 
C)  Fewer product defects. 
D)  Reduced waste. 
E)  Consistent production levels.

Question 13

Use the following information to compute the cost of goods manufactured. Assume that all raw materials used were traceable to specific units of product. $\begin{array} { l | r } 
\text { Beginning raw materials } & \$ 5,500 \
\hline \text { Ending raw materials } & 4,000 \
\hline \text { Direct labor } & 12,250 \
\hline \text { Raw material purchases } & 7,400 \
\hline \text { Depreciation on factory equipment } & 6,500 \
\hline \text { Factory repairs and maintenance } & 3,300 \
\hline \text { Beginning finished goods inventory } & 10,200 \
\hline \text { Ending finished goods inventory } & 8,900 \
\hline \text { Beginning work in process inventory } & 5,700 \
\hline \text { Ending work in process inventory } & 6,300
\end{array}$

Accepted Answer

A)  $36,650. 
B)  $30,350. 
C)  $30,650. 
D)  $30,950. 
E)  $31,650. 
A)  $36,650. 
B)  $30,350. 
C)  $30,650. 
D)  $30,950. 
E)  $31,650.

Question 14

An approach to managing inventories and production operations such that units of materials and products are obtained and provided only as they are needed is called:

Accepted Answer

A)  Continuous improvement. 
B)  Theory of constraints. 
C)  Total quality management. 
D)  Customer orientation. 
E)  Just-in-time manufacturing. 
A)  Continuous improvement. 
B)  Theory of constraints. 
C)  Total quality management. 
D)  Customer orientation. 
E)  Just-in-time manufacturing.

Question 15

Period costs can refer to expenditures necessary to finish products during the time period.

Accepted Answer

A) True 
 B)False

Question 16

Just-in-time manufacturing is a system that acquires inventory and produces product only when needed for an order.

Accepted Answer

A) True 
 B)False

Question 17

The following information pertains to the Packer Corporation. Calculate the cost of goods sold for the period: $\begin{array} { l c } 
\text { Beginning Raw Materials } &\$ 30,000  \
\text { Ending Raw Materials } & 70,000 \
\text { Beginning Work in Process Inventory } & 40,000 \
\text { Ending Work in Process Inventory } & 46,000 \
\text { Beginning Finished Goods Inventory } & 72,000 \
\text { Ending Finished Goods Inventory } & 68,000 \
\text { Cost of Goods Manufactured for the period } & \$ 246,000
\end{array}$

Accepted Answer

A)  $258,000. 
B)  $290,000. 
C)  $242,000. 
D)  $250,000. 
E)  $246,000. 
A)  $258,000. 
B)  $290,000. 
C)  $242,000. 
D)  $250,000. 
E)  $246,000.

Question 18

Asteroid Industries accumulated the following cost information for the year: $$\begin{array} { l | r } 
\text { Direct materials } & \$ 16,000 \
\hline \text { Indirect materials } & 4,000 \
\hline \text { Indirect labor } &  8 , 5 0 0 \
\hline \text { Factory depreciation } & 12,800 \
\hline \text { Direct labor } & 3 7 , 0 0 0 
\end{array}$$ Using the above information, total factory overhead costs would be:

Accepted Answer

A)  $16,800. 
B)  $53,000. 
C)  $25,300. 
D)  $78,300. 
E)  $12,800. 
A)  $16,800. 
B)  $53,000. 
C)  $25,300. 
D)  $78,300. 
E)  $12,800.

Question 19

Using the information below for Sundar Company; determine the total manufacturing costs added 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)  $98,000. 
B)  $79,000. 
C)  $43,500. 
D)  $98,600. 
E)  $42,900. 
A)  $98,000. 
B)  $79,000. 
C)  $43,500. 
D)  $98,600. 
E)  $42,900.

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 conversion costs total:

Accepted Answer

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

Exam 18: Managerial Accounting Concepts and Principles

Which of the following items appears only in a manufacturing company's financial statements?

The schedule of cost of goods manufactured is also known as a manufacturing statement.

One of the usual differences between financial and managerial accounting is the timeliness of the information reported.

Using the information below, compute the Days' sales in raw materials inventory: Raw Materials Used \ 85,500 Beginning Raw Materials Inventory 8,000 Ending Raw Materials Inventory 9,000

Raw materials inventory should not include indirect materials.

The three major cost components of manufacturing a product are:

Total quality management (TQM) is a system that acquires inventory and produces only when needed.

If beginning and ending work in process inventories are $5,000 and $15,000, respectively, and cost of goods manufactured is $170,000, what is the total manufacturing cost for the period?

Using the information below for Laurels Company; determine the cost of goods manufactured during the current year: Direct materials used \ 5,000 Direct Labor 7,000 Total Factory overhead 5,100 Beginning work in process 3,000 Ending work in process 4,000

A management concept based on an understanding of the changing wants and needs of customers, and which leads to flexible product designs and production processes, is called:

Goals of a Total Quality Management process include all of the following except:

An approach to managing inventories and production operations such that units of materials and products are obtained and provided only as they are needed is called:

Period costs can refer to expenditures necessary to finish products during the time period.

Just-in-time manufacturing is a system that acquires inventory and produces product only when needed for an order.

Asteroid Industries accumulated the following cost information for the year: Direct materials \ 16,000 Indirect materials 4,000 Indirect labor 8,500 Factory depreciation 12,800 Direct labor 37,000 Using the above information, total factory overhead costs would be:

Using the information below for Sundar Company; determine the total manufacturing costs added 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

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 conversion 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

Filters