Question 1

The way of doing business whose goal is to eliminate waste while satisfying the customer and providing a positive return to the company is:

Accepted Answer

A)  Total quality management. 
B)  Managerial accounting. 
C)  Customer orientation. 
D)  Continuous improvement. 
E)  Lean business model. 
A)  Total quality management. 
B)  Managerial accounting. 
C)  Customer orientation. 
D)  Continuous improvement. 
E)  Lean business model.

Question 2

If beginning and ending goods 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)  $180,000 
B)  $155,000 
C)  $160,000 
D)  $175,000 
E)  $165,000 
A)  $180,000 
B)  $155,000 
C)  $160,000 
D)  $175,000 
E)  $165,000

Question 3

_____________________ inventory consists of goods a company acquires to use in making products.

Accepted Answer

The answer of _____________________ inventory consists of goods a company...

Question 4

The Goods in Process Inventory account is found only in the ledgers of merchandising companies.

Accepted Answer

A) True 
 B)False

Question 5

Explain what is meant by the "lean business model" and why many businesses have adopted it.

Accepted Answer

The lean business model is a model whose

Question 6

The Lean Business Model should have no effect on cost in a modern manufacturing environment.

Accepted Answer

A) True 
 B)False

Question 7

Information for Reedy Manufacturing follows:
 $\begin{array}{lr}
\text { Beginning raw materials inventory } & \$ 46,800 \
\text { Beginning goods in process inventory } & 21,200 \
\text { Direct labor } & 81,000 \
\text { Beginning finished goods inventory } & 64,000 \
\text { Total factory overhead } & 106,000 \
\text { Raw materials purchased } & 21,500 \
\text { Ending raw materials inventory } & 40,000 \
\text { Ending goods in process inventory } & 20,000 \
\text { Ending finished goods inventory } & 46,000
\end{array}$
 
Calculate both the cost of goods manufactured and the cost of goods sold for Reedy Manufacturing.

Accepted Answer

None

Question 8

Match the following terms with the appropriate definition.
__________ (1) Sunk costs
__________ (2) Indirect costs
__________ (3) Product costs
__________ (4) Prime costs
__________ (5) Fixed costs
__________ (6) Opportunity costs
__________ (7) Period costs
__________ (8) Conversion costs
__________ (9) Factory overhead
__________ (10) Variable costs
(a) Costs that flow directly to the current income statement as expenses.
(b) Costs that change in proportion to changes in volume of activity.
(c) The potential benefit lost by choosing a specific action from two or more alternatives.
(d) Manufacturing expenditures that cannot be separately or readily traced to finished goods.
(e) Expenditures necessary and integral to finished products.
(f) Expenditures incurred in the process of converting raw materials to finished products; include direct labor and factory overhead.
(g) Costs that have already been incurred and cannot be avoided or changed.
(h) Expenditures directly associated with the manufacture of finished products; include direct materials and direct labor.
(i) Costs that do not change with changes in the volume of activity.
(j) Costs that are incurred for the benefit of more than one cost object.

Accepted Answer

(1) g (2) j (3) e (4

Question 9

A fixed cost:

Accepted Answer

A)  Requires the future outlay of cash and is relevant for future decision making. 
B)  Does not change with changes in the volume of activity within the relevant range. 
C)  Is directly traceable to a cost object. 
D)  Changes with changes in the volume of activity within the relevant range. 
E)  Has already been incurred and cannot be avoided so it is irrelevant for decision making. 
A)  Requires the future outlay of cash and is relevant for future decision making. 
B)  Does not change with changes in the volume of activity within the relevant range. 
C)  Is directly traceable to a cost object. 
D)  Changes with changes in the volume of activity within the relevant range. 
E)  Has already been incurred and cannot be avoided so it is irrelevant for decision making.

Question 10

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

Accepted Answer

The answer of The model whose goal is to eliminate...

Question 11

Describe the three types of inventories that are carried by manufacturers..

Accepted Answer

Manufacturers carry three types of inven

Question 12

A sunk cost has already been incurred and cannot be avoided or changed,so it is irrelevant to decision making.

Accepted Answer

A) True 
 B)False

Question 13

Newly completed units are combined with beginning finished goods inventory to make up total ending goods in process inventory.

Accepted Answer

A) True 
 B)False

Question 14

A manufacturing company has a beginning finished goods inventory of $14,600,raw material purchases of $18,000,cost of goods manufactured of $32,500,and an ending finished goods inventory of $17,800.The cost of goods sold for this company is:

Accepted Answer

A)  $21,200 
B)  $29,300 
C)  $32,500 
D)  $47,100 
E)  $27,600 
A)  $21,200 
B)  $29,300 
C)  $32,500 
D)  $47,100 
E)  $27,600

Question 15

Raw materials inventory turnover equals raw materials used divided by average raw materials inventory.

Accepted Answer

A) True 
 B)False

Question 16

Total manufacturing costs incurred during the year do not include:

Accepted Answer

A)  Direct materials used. 
B)  Factory supplies used. 
C)  Goods in process inventory, beginning balance. 
D)  Direct labor. 
E)  Depreciation of factory machinery. 
A)  Direct materials used. 
B)  Factory supplies used. 
C)  Goods in process inventory, beginning balance. 
D)  Direct labor. 
E)  Depreciation of factory machinery.

Question 17

Factory overhead includes selling and administrative expenses because they are indirect costs of a product.

Accepted Answer

A) True 
 B)False

Question 18

Match between columns
                        Premises:  An idea that rejects the notions of "good enough" and "acceptable" and challenges employees and managers to continually experiment with new and improved business practices.
 Goods a company acquires to use in making products.
 The ratio which computes how many times a company turns over its raw materials inventory in a period.
 A system that acquires inventory and produces only when needed.
 An approach that aids continuous improvement by augmenting financial measures with information on the drivers or indicators of future financial performance along the four dimensions of (1) financial; (2) customer; (3) internal business processes; (4) learning and growth.
 Expenditures directly associated with the manufacture of finished goods; includes direct materials and direct labor.
 An idea that means that employees understand the changing needs and wants of their customers and align their management and operating practices accordingly.
 Products in the process of being manufactured but not yet complete.
 A model whose goal is to eliminate waste while satisfying the customer and providing a positive return to the company.
 An activity that provides financial and nonfinancial information to an organization's managers and other internal decision makers.

Accepted Answer

The Answer of Managerial accounting and Continuous improvement and Raw is...

Question 19

A manufacturer's cost of goods manufactured is the sum of direct materials,direct labor,and factory overhead costs incurred in producing products.

Accepted Answer

A) True 
 B)False

Question 20

Expenditures necessary and integral to the manufacture of finished products are ________________ costs.

Accepted Answer

The answer of Expenditures necessary and integral to the manufacture...

Exam 14: Managerial Accounting Concepts and Principles

The way of doing business whose goal is to eliminate waste while satisfying the customer and providing a positive return to the company is:

If beginning and ending goods 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?

_____________________ inventory consists of goods a company acquires to use in making products.

The Goods in Process Inventory account is found only in the ledgers of merchandising companies.

Explain what is meant by the "lean business model" and why many businesses have adopted it.

The Lean Business Model should have no effect on cost in a modern manufacturing environment.

A fixed cost:

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

Describe the three types of inventories that are carried by manufacturers..

A sunk cost has already been incurred and cannot be avoided or changed,so it is irrelevant to decision making.

Newly completed units are combined with beginning finished goods inventory to make up total ending goods in process inventory.

A manufacturing company has a beginning finished goods inventory of $14,600,raw material purchases of $18,000,cost of goods manufactured of $32,500,and an ending finished goods inventory of $17,800.The cost of goods sold for this company is:

Raw materials inventory turnover equals raw materials used divided by average raw materials inventory.

Total manufacturing costs incurred during the year do not include:

Factory overhead includes selling and administrative expenses because they are indirect costs of a product.

A manufacturer's cost of goods manufactured is the sum of direct materials,direct labor,and factory overhead costs incurred in producing products.

Expenditures necessary and integral to the manufacture of finished products are ________________ costs.

Introducing Accounting in Business

Analyzing and Recording Transactions

Adjusting Accounts and Preparing Financial Statements

Accounting for Merchandising Operations

Inventories and Cost of Sales

Cash and Internal Controls

Accounts and Notes Receivable

Long-Term Assets

Current Liabilities

Long-Term Liabilities

Corporate Reporting and Analysis

Reporting Cash Flows

Analysis of Financial Statements

Job Order Costing and Analysis

Process Costing

Activity-Based Costing and Analysis

Cost-Volume-Profit Analysis

Variable Costing and Performance Reporting

Master Budgets and Performance Planning

Flexible Budgets and Standard Costs

Decentralization and Performance Measurement

Relevant Costing for Managerial Decisions

Capital Budgeting and Investment Analysis

Accounting With Special Journals

Time Value of Money

Investments and International Operations

Accounting for Partnerships

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