Question 1

Which of the following describes the cost of goods manufactured?

Accepted Answer

A)  the cost of the goods that were sold during the period 
B)  the total cost of all goods that were completed, or partially completed during the period 
C)  the cost of those goods that were completed during the period 
D)  the total costs in inventory at the end of the period 
A)  the cost of the goods that were sold during the period 
B)  the total cost of all goods that were completed, or partially completed during the period 
C)  the cost of those goods that were completed during the period 
D)  the total costs in inventory at the end of the period

Question 2

Value added activities which begin in research and development through product design and production are called ________.

Accepted Answer

A)  downstream activities 
B)  design activities 
C)  upstream activities 
D)  sustainability activities 
A)  downstream activities 
B)  design activities 
C)  upstream activities 
D)  sustainability activities

Question 3

For a manufacturer,rent paid for an office building is an example of a period cost.

Accepted Answer

A) True 
 B)False

Question 4

The following information has been provided by Crosby Corporation: $$\begin{array} { | l | l | } 
\hline \text { Direct Labor } & \$ 6000 \
\hline \text { Direct Materials Used } & 3000 \
\hline \text { Direct Materials Purchased } & 3000 \
\hline \text { Cost of Goods Manufactured } & 13,000 \
\hline \text { Ending Work-in-Process Inventory } & 1400 \
\hline \text { Corporate Headquarters' Property taxes } & 900 \
\hline \text { Manufacturing Overhead Incurred } & 400 \
\hline
\end{array}$$ The beginning balance of Work-in-Process Inventory account was ________.

Accepted Answer

A)  $4500 
B)  $5000 
C)  $21,000 
D)  $9400 
A)  $4500 
B)  $5000 
C)  $21,000 
D)  $9400

Question 5

The IMA Statement of Ethical Professional Practice include confidentiality,competence,credibility,and integrity.

Accepted Answer

A) True 
 B)False

Question 6

A company that uses labor,equipment,supplies,and facilities to convert raw materials into finished products is a ________.

Accepted Answer

A)  merchandising company 
B)  manufacturing company 
C)  service company 
D)  trading company 
A)  merchandising company 
B)  manufacturing company 
C)  service company 
D)  trading company

Question 7

Freight costs paid to ship raw materials to a company warehouse are considered product costs.

Accepted Answer

A) True 
 B)False

Question 8

Mars Supplies Company provided the following information for the year: $$\begin{array} { | l | r | } 
\hline \text { Beginning Balance - Work-in-Process Inventory } & \$ 24,000 \
\hline \text { Ending Balance - Work-in-Process Inventory } & 58,000 \
\hline \text { Beginning Balance - Direct Materials Inventory } & 85,000 \
\hline \text { Ending Balance - Direct Materials Inventory } & 61,000 \
\hline \text { Purchases - Direct Materials } & 359,000 \
\hline \text { Direct Labor } & 470,000 \
\hline \text { Indirect Labor } & 21,000 \
\hline \text { Depreciation on Factory Plant and Equipment } & 24,000 \
\hline \text { Plant Utilities and Insurance } & 268,000 \
\hline
\end{array}$$ What was the amount of the manufacturing overhead costs?

Accepted Answer

A)  $313,000 
B)  $45,000 
C)  $292,000 
D)  $491,000 
A)  $313,000 
B)  $45,000 
C)  $292,000 
D)  $491,000

Question 9

List the three kinds of inventory accounts that are used by manufacturing companies.Briefly discuss what each account includes.

Accepted Answer

Raw Materials Inventory includes materia

Question 10

For a manufacturing company,which of the following is a period cost?

Accepted Answer

A)  direct materials used 
B)  office rent 
C)  wages expense of factory workers 
D)  indirect materials used 
A)  direct materials used 
B)  office rent 
C)  wages expense of factory workers 
D)  indirect materials used

Question 11

Lakeshore Manufacturing provided the following information for the month ended March 31: $$\begin{array} { | l | r | } 
\hline \text { Sales Revenue } & \$ 30,000 \
\hline \text { Beginning Finished Goods Inventory } & 17,000 \
\hline \text { Ending Finished Goods Inventory } & 11,500 \
\hline \text { Cost of Goods Manufactured } & 12,600 \
\hline
\end{array}$$ Compute gross profit.

Accepted Answer

A)  $11,900 
B)  $17,400 
C)  $22,900 
D)  $5900 
A)  $11,900 
B)  $17,400 
C)  $22,900 
D)  $5900

Question 12

Which of the following statements is TRUE of managerial accounting?

Accepted Answer

A)  The external stakeholders of a company are the primary users of managerial accounting. 
B)  Managerial accounting information is used to help managers plan, direct and control their operations. 
C)  An external audit by an independent CPA is required for managerial accounting information. 
D)  Managerial accounting information must comply with Generally Accepted Accounting Principles. 
A)  The external stakeholders of a company are the primary users of managerial accounting. 
B)  Managerial accounting information is used to help managers plan, direct and control their operations. 
C)  An external audit by an independent CPA is required for managerial accounting information. 
D)  Managerial accounting information must comply with Generally Accepted Accounting Principles.

Question 13

Identify each cost as a period cost or a product cost.
-Wages for the assembly line workers

Accepted Answer

A) Product cost 
B) Period cost 
A) Product cost 
B) Period cost

Question 14

The cost of direct materials cannot easily be traced to the manufactured product,and therefore,it is a component of manufacturing overhead.

Accepted Answer

A) True 
 B)False

Question 15

Identify each cost as a period cost or a product cost.
-CEO's salary

Accepted Answer

A) Product cost 
B) Period cost 
A) Product cost 
B) Period cost

Question 16

Arturo Manufacturing,Inc.provided the following information for the year: $$\begin{array} { | l | r | } 
\hline \text { Beginning Balance - Work-in-Process Inventory } & \$ 150,000 \
\hline \text { Ending Balance - Work-in-Process Inventory } & 62,500 \
\hline \text { Beginning Balance - Direct Materials } & 269,000 \
\hline \text { Ending Balance - Direct Materials } & 53,700 \
\hline \text { Purchases - Direct Materials } & 133,000 \
\hline \text { Direct Labor } & 74,380 \
\hline \text { Indirect Materials } & 52,350 \
\hline \text { Indirect Labor } & 132,500 \
\hline \text { Depreciation on Factory Plant and Equipment } & 72,160 \
\hline \text { Plant Utilities and Insurance } & 70,980 \
\hline
\end{array}$$ How much is the cost of goods manufactured?

Accepted Answer

A)  $838,170 
B)  $750,670 
C)  $900,670 
D)  $766,010 
A)  $838,170 
B)  $750,670 
C)  $900,670 
D)  $766,010

Question 17

Mason Cabinet Company sells standard kitchen cabinets.The following information summarizes Mason's operating activities for the year:
 $$\begin{array} { | l | r | } 
\hline \text { Selling and Administrative Expenses } & \$ 42,750 \
\hline \text { Purchases } & 85,700 \
\hline \text { Sales Revenue } & 154,500 \
\hline \text { Merchandise Inventory, January 1 } & 12,500 \
\hline \text { Merchandise Inventory, December 31 } & 16,200 \
\hline
\end{array}$$ Mason sold 950 cabinets during the year.
Calculate the operating income for the year.
Compute the unit cost for one cabinet (Round to two decimal places.)

Accepted Answer

Operating income for the year

Question 18

Which of the following correctly describes the accounting for advertising costs?

Accepted Answer

A)  Advertising costs are product costs and are expensed as incurred. 
B)  Advertising costs are period costs and are expensed as incurred. 
C)  Advertising costs are product costs and are expensed when the manufactured product is sold. 
D)  Advertising costs are period costs and are expensed when the manufactured product is sold. 
A)  Advertising costs are product costs and are expensed as incurred. 
B)  Advertising costs are period costs and are expensed as incurred. 
C)  Advertising costs are product costs and are expensed when the manufactured product is sold. 
D)  Advertising costs are period costs and are expensed when the manufactured product is sold.

Question 19

Manufacturing overhead is also referred to as ________.

Accepted Answer

A)  indirect manufacturing costs 
B)  direct manufacturing costs 
C)  prime costs 
D)  period costs 
A)  indirect manufacturing costs 
B)  direct manufacturing costs 
C)  prime costs 
D)  period costs

Question 20

Repair and maintenance costs of vehicles used to deliver products to the customers are included in manufacturing overhead.

Accepted Answer

A) True 
 B)False

Exam 18: Introduction to Managerial Accounting

Which of the following describes the cost of goods manufactured?

Value added activities which begin in research and development through product design and production are called ________.

For a manufacturer,rent paid for an office building is an example of a period cost.

The IMA Statement of Ethical Professional Practice include confidentiality,competence,credibility,and integrity.

A company that uses labor,equipment,supplies,and facilities to convert raw materials into finished products is a ________.

Freight costs paid to ship raw materials to a company warehouse are considered product costs.

List the three kinds of inventory accounts that are used by manufacturing companies.Briefly discuss what each account includes.

For a manufacturing company,which of the following is a period cost?

Lakeshore Manufacturing provided the following information for the month ended March 31: Sales Revenue \ 30,000 Beginning Finished Goods Inventory 17,000 Ending Finished Goods Inventory 11,500 Cost of Goods Manufactured 12,600 Compute gross profit.

Which of the following statements is TRUE of managerial accounting?

Identify each cost as a period cost or a product cost. -Wages for the assembly line workers

The cost of direct materials cannot easily be traced to the manufactured product,and therefore,it is a component of manufacturing overhead.

Identify each cost as a period cost or a product cost. -CEO's salary

Which of the following correctly describes the accounting for advertising costs?

Manufacturing overhead is also referred to as ________.

Repair and maintenance costs of vehicles used to deliver products to the customers are included in manufacturing overhead.

Accounting and the Business Environment

Recording Business Transactions

The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations

Merchandise Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Plant Assets,natural Resources,and Intangibles

Current Liabilities and Payroll

Partnerships

Corporations

Long-Term Liabilities

Investments

The Statement of Cash Flows

Financial Statement Analysis

Job Order Costing

Process Costing

Cost-Volume-Profit Analysis

Master Budgets

Flexible Budgets and Standard Cost Systems

Cost Allocation and Responsibility Accounting

Short-Term Business Decisions

Capital Investment Decisions

Filters