Question 1

Finished goods inventory would normally include:

Accepted Answer

A) direct materials in stock and awaiting use in the manufacturing process. 
B) goods fully completed but not yet sold. 
C) products in their original form intended to be sold without changing their basic form. 
D) goods partially worked on but not yet fully completed. 
A) direct materials in stock and awaiting use in the manufacturing process. 
B) goods fully completed but not yet sold. 
C) products in their original form intended to be sold without changing their basic form. 
D) goods partially worked on but not yet fully completed.

Question 2

An unfavourable production-volume variance occurs when:

Accepted Answer

A) production exceeds the denominator level. 
B) production exceeds unit sales. 
C) the denominator level exceeds production. 
D) unit sales exceed production. 
A) production exceeds the denominator level. 
B) production exceeds unit sales. 
C) the denominator level exceeds production. 
D) unit sales exceed production.

Question 3

What is cost allocation?

Accepted Answer

A) A function of cost tracing 
B) The process of determining the actual cost of the cost object 
C) The assignment of indirect costs to the chosen cost object 
D) The process of tracking both direct and indirect costs associated with a cost object 
A) A function of cost tracing 
B) The process of determining the actual cost of the cost object 
C) The assignment of indirect costs to the chosen cost object 
D) The process of tracking both direct and indirect costs associated with a cost object

Question 4

For last year,Deniliquin Manufacturing reported the following:
$\begin{array}{|l|r|}
\hline\text { Revenue } & \$ 420000 \
\hline \text { Beginning inventory of direct materials, January 1 } & 22000 \
\hline \text { Purchases of direct materials } & 146000 \
\hline \text { Ending inventory of direct materials, December 31 } & 16000 \
\hline \text { Direct manufacturing labour } & 40000 \
\hline \text { Indirect manufacturing costs } & 35000 \
\hline \text { Beginning inventory of finished goods, January 1 } & 104000 \
\hline \text { Cost of goods manufactured } & 36000 \
\hline \text { Ending inventory of finished goods, December 31 } & 140000\\hline
\end{array}$
-
What was Deniliquin's gross margin (or gross profit)?

Accepted Answer

A) $268 000 
B) $152 000 
C) $103 000 
D) $317 000 
A) $268 000 
B) $152 000 
C) $103 000 
D) $317 000

Question 5

The income statement of a service-sector firm reports:

Accepted Answer

A) period and inventoriable costs but at different times;the reporting varies. 
B) inventoriable costs only. 
C) both period and inventoriable costs. 
D) period costs only. 
A) period and inventoriable costs but at different times;the reporting varies. 
B) inventoriable costs only. 
C) both period and inventoriable costs. 
D) period costs only.

Question 6

Overtime premium consists of the wages paid to all workers (for both direct labour and indirect labour)in excess of their straight-time wage rates.

Accepted Answer

A) True 
 B)False

Question 7

The production-volume variance totals:

Accepted Answer

A) $2400 
B) $1500 
C) $2000 
D) 0 
A) $2400 
B) $1500 
C) $2000 
D) 0

Question 8

Whitecliffs Manufacturers wants to estimate costs for each product it produces at its Geelong plant.The Geelong plant produces three products,and runs two flexible assembly lines.Each assembly line can produce all three products.
Required:
a.Classify each of the following costs as either direct or indirect for each product.
b.Classify each of the following costs as either fixed or variable with respect to the number of units produced of each product.

Accepted Answer

Total variable costs are affected by flu

Question 9

Unit costs are found in all areas of the value chain.

Accepted Answer

A) True 
 B)False

Question 10

Answer the following questions using the information below:
Queanbeyan Company incurred fixed manufacturing costs of $7200 during 2018.Other information for 2018 includes:
The budgeted denominator level is 800 units.
Units produced total 1000 units.
Units sold total 950 units.
Beginning inventory was zero.
The fixed manufacturing cost rate is based on the budgeted denominator level.Manufacturing variances are closed to cost of goods sold.
-Mt Panorama Company has the following information for the current year:
$\begin{array}{lr}
\text { Beginuing fixed manufacturing overhead in inventory } & \$ 95,000 \
\text { Fixed manufacturing overhead in production } & 375,000 \
\text { Ending fixed manufacturing overhead in inventory } & 25,000\\\text { Begintuing variable manufacturing overhead in inventory } & \$ 10,000 \
\text { Variable manufacturing overhead in production } & 50,000 \
\text { Ending variable manufacturing overhead in inventory } & 15,000
\end{array}$
What is the difference between operating profits under absorption costing and variable costing?

Accepted Answer

A) $70 000 
B) $50 000 
C) $40 000 
D) $5000 
A) $70 000 
B) $50 000 
C) $40 000 
D) $5000

Question 11

Operating profit using variable costing will be ________ than operating profit if using absorption costing.

Accepted Answer

A) $2400 lower 
B) $2400 higher 
C) $3600 higher 
D) $900 lower 
A) $2400 lower 
B) $2400 higher 
C) $3600 higher 
D) $900 lower

Question 12

Answer the following questions using the information below:
The following information pertains to Bondi Creations:
 $\begin{array}{ll}
\hline & \
\hline \text { Manufacturing costs } & \$ 1,500,000 \
\hline \text { Units manufactured } & 30,000 \
\hline \text { Units sold } & 29,500 \text { units sold for } \$ 85 \text { per unit } \
\hline \text { Beginning inventory } & 0 \text { units } \
\hline\\hline
\end{array}$
-What is the cost of ending finished goods inventory?

Accepted Answer

A) $25 424 
B) $1 475 000 
C) $25 000 
D) $42 500 
A) $25 424 
B) $1 475 000 
C) $25 000 
D) $42 500

Question 13

Duggan Corporation has provided the following information:
$\begin{array}{|lr|}
\hline & \
\hline \text { Beginning work-in-process inventory } & \$ 20,000 \
\hline \text { Ending work-in-process inventory } & 23,000 \
\hline \text { Beginning finished goods inventory } & 36,000 \
\hline \text { Ending finished goods inventory } & 34,000 \
\hline \text { Cost of goods manufactured } & 246,000 \
\hline\\hline
\end{array}$
What is cost of goods sold?

Accepted Answer

A) $249 000 
B) $248 000 
C) $243 000 
D) $244 000 
A) $249 000 
B) $248 000 
C) $243 000 
D) $244 000

Question 14

In the cost classification system used by manufacturing firms,assembly workers' wages would be included in all of the following EXCEPT:

Accepted Answer

A) period cost. 
B) product cost. 
C) conversion cost. 
D) prime cost. 
A) period cost. 
B) product cost. 
C) conversion cost. 
D) prime cost.

Question 15

In the cost classification system used by manufacturing firms,total manufacturing costs would include all of the following EXCEPT:

Accepted Answer

A) prime costs and manufacturing overhead costs. 
B) direct materials costs,direct manufacturing labour costs,and manufacturing overhead costs. 
C) direct materials costs and conversion costs. 
D) indirect materials costs,indirect manufacturing labour costs,and manufacturing overhead costs. 
A) prime costs and manufacturing overhead costs. 
B) direct materials costs,direct manufacturing labour costs,and manufacturing overhead costs. 
C) direct materials costs and conversion costs. 
D) indirect materials costs,indirect manufacturing labour costs,and manufacturing overhead costs.

Question 16

Booti Booti Bottling Works manufactures glass bottles.January and February operations were identical in every way except for the planned production.
January had a production denominator of 35 000 units.
February had a production denominator of 36 000 units.
Fixed manufacturing costs totalled $126 000.
Sales for both months totalled 45 000 units with variable manufacturing costs of $4 per unit.Selling and administrative costs were $0.40 per unit variable and $60 000 fixed.The selling price was $10 per unit.
Required:
Compute the operating profit for both months using absorption costing.
_____________________________________________________________________________________________
_____________________________________________________________________________________________

Accepted Answer

The answer of Booti Booti Bottling Works manufactures glass bottles.January...

Question 17

Conversion costs represent all manufacturing costs incurred to convert direct materials into finished goods.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following cost(s)are inventoried when using variable costing?

Accepted Answer

A) Fixed manufacturing costs 
B) Direct manufacturing costs 
C) Variable marketing costs 
D) Both A and B are correct. 
A) Fixed manufacturing costs 
B) Direct manufacturing costs 
C) Variable marketing costs 
D) Both A and B are correct.

Question 19

A(n)________ cost is the cost incurred.

Accepted Answer

A) actual 
B) budgeted 
C) estimated 
D) sunk 
A) actual 
B) budgeted 
C) estimated 
D) sunk

Question 20

Using the following information to find the unknown amounts.Assume each set of information is an independent case.
$$\begin{array} { l l r } 
\text { a. Merchandise Inventory } & \text { Purchases } & \$ 420000 \
& \text { Cost of goods sold } & 446000 \
& \text { Beginuing balance } & 82000 \
& \text { Ending balance } & ? \
& & \
\text {b. Direct Materials }& \text { Beginuing balance } & \$ 14000 \
& \text { Ending balance } & 28000 \
& \text { Purchases } & 96000 \
& \text { Direct materials used } & ? \
& & \
\text { c. Direct Materials } & \text { Ending balance } & \$ 44000 \
& \text { Cost of goods manufactured } & 42000 \
& \text { Beginting balance } & 16000 \
& \text { Current manufacturing costs } & ? \
& & \
\text { d. Finished Goods Inventory } & \text { Cost of goods manufactured } & \$124000 \
& \text { Ending balance } & 40000 \
& \text { Cost of goods sold } & 122000\
&\text { Beginuing balance }&?
\end{array}$$

Accepted Answer

a.Ending balance of merchandise invento

Finished goods inventory would normally include:

An unfavourable production-volume variance occurs when:

What is cost allocation?

The income statement of a service-sector firm reports:

Overtime premium consists of the wages paid to all workers (for both direct labour and indirect labour)in excess of their straight-time wage rates.

The production-volume variance totals:

Unit costs are found in all areas of the value chain.

Operating profit using variable costing will be ________ than operating profit if using absorption costing.

Duggan Corporation has provided the following information: Beginning work-in-process inventory \ 20,000 Ending work-in-process inventory 23,000 Beginning finished goods inventory 36,000 Ending finished goods inventory 34,000 Cost of goods manufactured 246,000 What is cost of goods sold?

In the cost classification system used by manufacturing firms,assembly workers' wages would be included in all of the following EXCEPT:

In the cost classification system used by manufacturing firms,total manufacturing costs would include all of the following EXCEPT:

Conversion costs represent all manufacturing costs incurred to convert direct materials into finished goods.

Which of the following cost(s)are inventoried when using variable costing?

A(n)________ cost is the cost incurred.

Management Accounting in Context

Determining How Costs Behave

Costvolumeprofit Analysis

Estimating the Cost of Producing Services

Estimating the Costs of Products and Inventory

Target Costing, Managing Activities and Managing Capacity

Activity-Based Management and Activity-Based Costing

Pricing and Customer Profitability

Decision Making and Relevant Information

Budgeting, Management Control and Responsibility Accounting

Flexible Budgets, Direct Cost Variances and Management Control

Flexible Budgets, Overhead Cost Variances and Management Control

Allocation of Support-Department Costs, Common Costs and Revenues

Strategy Formation, Strategic Control and the Balanced Scorecard

Quality, Time and the Balanced Scorecard

Inventory Management, Just-In-Time and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, Transfer Pricing and Multinational Considerations

Performance Measurement, Compensation and Multinational Considerations

Measuring and Reporting Sustainability

Filters

Exam 2: Different Costs for Different Purposes

Finished goods inventory would normally include:

An unfavourable production-volume variance occurs when:

What is cost allocation?

The income statement of a service-sector firm reports:

Overtime premium consists of the wages paid to all workers (for both direct labour and indirect labour)in excess of their straight-time wage rates.

The production-volume variance totals:

Unit costs are found in all areas of the value chain.

Operating profit using variable costing will be ________ than operating profit if using absorption costing.

Duggan Corporation has provided the following information: Beginning work-in-process inventory \ 20,000 Ending work-in-process inventory 23,000 Beginning finished goods inventory 36,000 Ending finished goods inventory 34,000 Cost of goods manufactured 246,000 What is cost of goods sold?

In the cost classification system used by manufacturing firms,assembly workers' wages would be included in all of the following EXCEPT:

In the cost classification system used by manufacturing firms,total manufacturing costs would include all of the following EXCEPT:

Conversion costs represent all manufacturing costs incurred to convert direct materials into finished goods.

Which of the following cost(s)are inventoried when using variable costing?

A(n)________ cost is the cost incurred.

Management Accounting in Context

Determining How Costs Behave

Costvolumeprofit Analysis

Estimating the Cost of Producing Services

Estimating the Costs of Products and Inventory

Target Costing, Managing Activities and Managing Capacity

Activity-Based Management and Activity-Based Costing

Pricing and Customer Profitability

Decision Making and Relevant Information

Budgeting, Management Control and Responsibility Accounting

Flexible Budgets, Direct Cost Variances and Management Control

Flexible Budgets, Overhead Cost Variances and Management Control

Allocation of Support-Department Costs, Common Costs and Revenues

Strategy Formation, Strategic Control and the Balanced Scorecard

Quality, Time and the Balanced Scorecard

Inventory Management, Just-In-Time and Simplified Costing Methods

Capital Budgeting and Cost Analysis

Management Control Systems, Transfer Pricing and Multinational Considerations

Performance Measurement, Compensation and Multinational Considerations

Measuring and Reporting Sustainability

Filters