Crystal Ltd is a retailer of stone ornaments.The company sold 8000 units in 2017.The company has provided the following information: \[\begin{array} { | l | l | } \hline \text { Sales revenue } & \$ 598,000 \\ \hline \text { Purchases (excluding freight in) } & 300,000 \\ \hline \text { Selling and administrative expenses } & 67,000 \\ \hline \text { Freight in } & 14,000 \\ \hline \text { Beginning inventory } & 45,000 \\ \hline \text { Ending inventory } & 42,000 \\ \hline \end{array}\] What is the cost of goods available for sale for 2017?

A) $317,000 B) $331,000 C) $359,000 D) $345,000 A) $317,000 B) $331,000 C) $359,000 D) $345,000

Amoeba Manufacturing Company provided the following information for the year 2017: \[\begin{array} { | l | l | } \hline \text { Purchases - raw materials } & \$ 91,000 \\ \hline \text { Plant electricity, gas \& insurance } & 67,500 \\ \hline \text { Indirect materials } & 11,990 \\ \hline \text { Indirect labour } & 4200 \\ \hline \text { Direct materials used in production } & 99,000 \\ \hline \text { Direct labour } & 117,500 \\ \hline \text { Depreciation on factory plant \& equipment } & 7000 \\ \hline \text { Cost of goods manufactured } & 291,500 \\ \hline \text { Cost of sales } & 291,000 \\ \hline \end{array}\] The inventory account balances as of 1 January 2017 are given below. \[\begin{array} { | l | l | } \hline \text { Raw materials inventory } & \$ 41,000 \\ \hline \text { Work in process inventory } & 12,000 \\ \hline \text { Finished goods inventory } & 30,456 \\ \hline \end{array}\] What is the ending balance in the finished goods inventory?

A) $30,956 B) $30,456 C) $321,956 D) $261,044 A) $30,956 B) $30,456 C) $321,956 D) $261,044

The following information has been provided by Squash Company: \[\begin{array} { | l | l | } \hline \text { Direct labour } & \$ 6500 \\ \hline \text { Direct materials used } & 2000 \\ \hline \text { Raw materials purchased } &8000 \\ \hline \text { Cost of goods manufactured } & 17,000 \\ \hline \text { Ending work in process inventory } & 1500 \\ \hline \text { Corporate headquarters' property rates } & 300 \\ \hline \text { Manufacturing overhead incurred } & 420 \\ \hline \end{array}\] The beginning balance of the Work in process inventory account was ________.

A) $24,420 B) $9580 C) $8920 D) $9700 A) $24,420 B) $9580 C) $8920 D) $9700

Kentucky purchases and sells widgets.The following information summarises Kentucky's operating activities for 2017: \[\begin{array} { | l | l | } \hline \text { Selling and administrative expenses } & \$ 4600 \\ \hline \text { Purchases } & 159,000 \\ \hline \text { Sales revenue } & 785,000 \\ \hline \text { Inventory, 1 January 2017 } & 33,600 \\ \hline \text { Inventory, 31 December 2017 } & 76,800 \\ \hline \end{array}\] If the company sold 7700 units of widgets during 2017,how much is the cost for one widget?

A) $20.65 B) $25.01 C) $14.34 D) $15.04 A) $20.65 B) $25.01 C) $14.34 D) $15.04

Given the following information,determine the cost of goods manufactured. \[\begin{array} { | l | l | } \hline \text { Direct labour incurred } & \$ 61,000 \\ \hline \text { Manufacturing overhead incurred } & 175,500 \\ \hline \text { Direct materials used } & 154,000 \\ \hline \text { Finished goods inventory, 1/1/2017 } & 199,000 \\ \hline \text { Finished goods inventory, 31/12/2017 } & 222,000 \\ \hline \text { Work in process inventory, 1/1/2017 } & 26,000 \\ \hline \text { Work in process inventory, 31/12/2017 } & 109,000 \\ \hline \end{array}\]

A) $281,500 B) $390,500 C) $377,500 D) $312,000 A) $281,500 B) $390,500 C) $377,500 D) $312,000

Gamma Company has prepared a preliminary cash budget for the third quarter as shown below: \[\begin{array} { | l | l | l | l | } \hline \text { Cash budget } & { \text { Jul } } & { \text { Aug } } & \text { Sep } \\ \hline \text { Beginning cash balance } & \$ 32,000 & \$ 10,000 & \$ 13,500 \\ \hline \text { Plus: cash collections } & \$ 52,000 & \$ 52,000 & \$ 7,600 \\ \hline \text { Cash available } & \$ 4,000 & \$ 62,000 & \$ 61,100 \\ \hline \text { Less: cash payments: } & & & \\ \hline \text { Purchases of inventory } & 34,000 & 8000 & 10,000 \\ \hline \text { Operating expenses } & 40,000 & 30,500 & 30,700 \\ \hline \text { Capital expenditures } & 0 & 8000 & 7400 \\ \hline \text { Ending cash balance } & \$ 10,000 & \$ 13,500 & \$ 13,000 \\ \hline \end{array}\] Subsequently,the marketing department revised its figures for cash collections.New data are as follows: $54,000 in July,$56,000 in August and $42,000 in September.Based on the new data,calculate the new projected cash balance at the end of September.

A) $13,400 B) $13,000 C) $12,000 D) $19,500 A) $13,400 B) $13,000 C) $12,000 D) $19,500

Amoeba Manufacturing Company provided the following information for the year 2017: \[\begin{array} { | l | l | } \hline \text { Purchases-raw materials } & \$ 89,000 \\ \hline \text { Plant electricity, gas \& insurance } & 67,000 \\ \hline \text { Indirect materials } & 11,050 \\ \hline \text { Indirect labour } & 4900 \\ \hline \text { Direct materials used in production } & 98,000 \\ \hline \text { Direct labour } & 119,500 \\ \hline \text { Depreciation on factory plant \& equipment } & 5000 \\ \hline \text { Cost of goods manufactured } & 291,500 \\ \hline \end{array}\] The inventory account balances as of 1 January 2017 are given below. \[\begin{array} { | l | l | } \hline \text { Raw materials inventory } & \$ 46,000 \\ \hline \text { Work in process inventory } & 1300 \\ \hline \text { Finished goods inventory } & 48,000 \\ \hline \end{array}\] What is the ending balance in the Work in process inventory account?

A) $15,250 B) $44,700 C) $1300 D) $48,000 A) $15,250 B) $44,700 C) $1300 D) $48,000

Freighters Ltd has the following budgeted figures: \[\begin{array} { | l | l | l | l | l | } \hline & \text { January } & \text { February } & \text { March } & \text { April } \\ \hline \text { Sales } & \$ 57,500 & \$ 63,000 & \$ 89,000 & \$ 94,000 \\ \hline \text { Cost of sales } & 50 \% \text { of sales } & & & \\ \hline \text { Required } & \$ 20,000 + 25 \% & & & \\ \text { ending } & \text { of next month's } \\ \text { inventory } &\text {sales} & & \\ \hline \text { Inventory on } & & & & \\ \text { hand on 1 Jan } & \$ 27,500 & & & \\ \hline \end{array}\] Calculate the budgeted purchases for the month of January.

A) $37,000 B) $7000 C) $35,750 D) $64,500 A) $37,000 B) $7000 C) $35,750 D) $64,500

Exam 19: Introduction to Managerial Accounting and the Master Budget

Crystal Ltd is a retailer of stone ornaments.The company sold 8000 units in 2017.The company has provided the following information: Sales revenue \ 598,000 Purchases (excluding freight in) 300,000 Selling and administrative expenses 67,000 Freight in 14,000 Beginning inventory 45,000 Ending inventory 42,000 What is the cost of goods available for sale for 2017?

(Multiple Choice)

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Question 21

Period costs do NOT include which of the following?

(Multiple Choice)

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Question 22

Sales commissions are included in manufacturing overhead.

(True/False)

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Question 23

Budgeted operating expenses for the current year include the expiration of insurance that was paid for in a previous period.

(True/False)

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Question 24

Amoeba Manufacturing Company provided the following information for the year 2017: Purchases - raw materials \ 91,000 Plant electricity, gas \& insurance 67,500 Indirect materials 11,990 Indirect labour 4200 Direct materials used in production 99,000 Direct labour 117,500 Depreciation on factory plant \& equipment 7000 Cost of goods manufactured 291,500 Cost of sales 291,000 The inventory account balances as of 1 January 2017 are given below. Raw materials inventory \ 41,000 Work in process inventory 12,000 Finished goods inventory 30,456 What is the ending balance in the finished goods inventory?

(Multiple Choice)

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Question 25

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

(Multiple Choice)

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Question 26

Which of the following statements about managerial accounting is CORRECT?

(Multiple Choice)

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Question 27

In preparing an operating budget,the sales budget is prepared first.Which of the following is prepared next?

(Multiple Choice)

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Question 28

The following information has been provided by Squash Company: Direct labour \ 6500 Direct materials used 2000 Raw materials purchased 8000 Cost of goods manufactured 17,000 Ending work in process inventory 1500 Corporate headquarters' property rates 300 Manufacturing overhead incurred 420 The beginning balance of the Work in process inventory account was ________.

(Multiple Choice)

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Question 29

Kentucky purchases and sells widgets.The following information summarises Kentucky's operating activities for 2017: Selling and administrative expenses \ 4600 Purchases 159,000 Sales revenue 785,000 Inventory, 1 January 2017 33,600 Inventory, 31 December 2017 76,800 If the company sold 7700 units of widgets during 2017,how much is the cost for one widget?

(Multiple Choice)

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Question 30

Given the following information,determine the cost of goods manufactured. Direct labour incurred \ 61,000 Manufacturing overhead incurred 175,500 Direct materials used 154,000 Finished goods inventory, 1/1/2017 199,000 Finished goods inventory, 31/12/2017 222,000 Work in process inventory, 1/1/2017 26,000 Work in process inventory, 31/12/2017 109,000

(Multiple Choice)

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Question 31

Which of the following statements is TRUE about the capital expenditures budget?

(Multiple Choice)

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Question 32

Gamma Company has prepared a preliminary cash budget for the third quarter as shown below: Cash budget Jul Aug Sep Beginning cash balance \ 32,000 \ 10,000 \ 13,500 Plus: cash collections \ 52,000 \ 52,000 \ 7,600 Cash available \ 4,000 \ 62,000 \ 61,100 Less: cash payments: Purchases of inventory 34,000 8000 10,000 Operating expenses 40,000 30,500 30,700 Capital expenditures 0 8000 7400 Ending cash balance \ 10,000 \ 13,500 \ 13,000 Subsequently,the marketing department revised its figures for cash collections.New data are as follows: $54,000 in July,$56,000 in August and $42,000 in September.Based on the new data,calculate the new projected cash balance at the end of September.

(Multiple Choice)

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Question 33

Amoeba Manufacturing Company provided the following information for the year 2017: Purchases-raw materials \ 89,000 Plant electricity, gas \& insurance 67,000 Indirect materials 11,050 Indirect labour 4900 Direct materials used in production 98,000 Direct labour 119,500 Depreciation on factory plant \& equipment 5000 Cost of goods manufactured 291,500 The inventory account balances as of 1 January 2017 are given below. Raw materials inventory \ 46,000 Work in process inventory 1300 Finished goods inventory 48,000 What is the ending balance in the Work in process inventory account?

(Multiple Choice)

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Question 34

A3+ has prepared its third quarter budget and provided the following data: Jul Aug Sep Cash collections \ 50,000 \ 39,900 \ 46,300 Cash payments: Purchases of inventory 30,000 21,500 17,900 Operating expenses 12,100 8600 11,100 Capital expenditures 13,500 24,300 0 The cash balance on 30 June is projected to be $4000.The company has to maintain a minimum cash balance of $5,000 and is authorised to borrow at the end of each month to make up any shortfalls.It may borrow in increments of $5,000 and has to pay interest every month at an annual rate of 4%.All financing transactions are assumed to take place at the end of the month.The loan balance should be repaid in increments of $5,000 whenever there is surplus cash. How much will the company have to borrow at the end of July?

(Multiple Choice)

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Question 35

Which of the following is an example of direct labour?

(Multiple Choice)

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Question 36

Period costs are costs that are expensed in the period in which they are incurred.

(True/False)

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Question 37

Freighters Ltd has the following budgeted figures: January February March April Sales \ 57,500 \ 63,000 \ 89,000 \ 94,000 Cost of sales 50\% of sales Required \ 20,000+25\% ending of next month's inventory sales Inventory on hand on 1 Jan \ 27,500 Calculate the budgeted purchases for the month of January.

(Multiple Choice)

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Question 38

At a company with different business units,individual managers can modify various assumptions of their budget in order to determine how the modifications would affect the operational and financial results.This is an example of:

(Multiple Choice)

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Question 39

Which of the following BEST describes just-in-time inventory management?

(Multiple Choice)

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Question 40

Period costs do NOT include which of the following?

Sales commissions are included in manufacturing overhead.

Budgeted operating expenses for the current year include the expiration of insurance that was paid for in a previous period.

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

Which of the following statements about managerial accounting is CORRECT?

In preparing an operating budget,the sales budget is prepared first.Which of the following is prepared next?

Which of the following statements is TRUE about the capital expenditures budget?

Which of the following is an example of direct labour?

Period costs are costs that are expensed in the period in which they are incurred.

At a company with different business units,individual managers can modify various assumptions of their budget in order to determine how the modifications would affect the operational and financial results.This is an example of:

Which of the following BEST describes just-in-time inventory management?

The Role of Accounting in Decision Making

Recording Business Transactions

The Adjusting Process

Completing the Accounting Cycle

Retailing Operations

Retail Inventory

Accounting Information Systems

Internal Control and Cash

Receivables

Non-Current Assets: Property, plant and Equipment, and Intangibles

Current Liabilities and Payroll

Non-Current Liabilities,debentures Payable and Classification of Liabilities on the Balance Sheet

Partnerships

Companies: Formation and Shareholders Equity

Companies: Capital Management and the Income Statement

The Cash Flow Statement

The Framework of Accounting

Financial Statement Analysis

Job Costing

Cost-Volume-Profit Analysis

Short-Term Business Decisions

Capital Investment Decisions and the Time Value of Money

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