Question 1

How is conversion cost calculated?

Accepted Answer

A)  product costs plus period costs 
B)  direct materials cost plus prime costs 
C)  indirect labour cost plus opportunity costs 
D)  direct labour cost plus manufacturing overhead cost 
A)  product costs plus period costs 
B)  direct materials cost plus prime costs 
C)  indirect labour cost plus opportunity costs 
D)  direct labour cost plus manufacturing overhead cost

Question 2

Reducing the cost required to achieve a given benefit means that a company is becoming less efficient.

Accepted Answer

A) True 
 B)False

Question 3

Econo Company
In July, Econo Company purchased materials costing $21,000 and incurred direct labour cost of $18,000. Manufacturing overhead totalled $32,000 for the month. Information on inventories was as follows: $\begin{array}{lrr}&\text { July } 1& \text { July } 31\
\text { Materials } & \$ 6,200 & \$ 7,100 \
\text { Work-in-process } & \$ 700 & \$ 1,200 \
\text { Finished goods } & \$ 3,300 & \$ 2,700
\end{array}$
-Refer to Quest Company. What was the total period cost?

Accepted Answer

A)  $24,000 
B)  $46,000 
C)  $190,000 
D)  $250,000 
A)  $24,000 
B)  $46,000 
C)  $190,000 
D)  $250,000

Question 4

Match each of the following terms with their correct description from the items listed below.
-Number of units sold multiplied by sales price per unit

Accepted Answer

A) Gross Margin 
B) Selling Expenses 
C) Sales Revenue 
D) Cost of Goods Sold 
E) Operating Income 
A) Gross Margin 
B) Selling Expenses 
C) Sales Revenue 
D) Cost of Goods Sold 
E) Operating Income

Question 5

Rizzuto Company supplied the following information for the month of January.
Cost of goods sold percentage 62%
Selling expense percentage 6%
Administrative expense 13%
Required: Reconstruct Rizzuto's Income Statement for January assuming that the total sales revenue for the month equalled $500,000.

Accepted Answer

Rizzuto Company
Income Statement
For the

Question 6

In terms of managerial accounting, what is the best definition of cost?

Accepted Answer

A)  the equivalent of the cost of goods sold 
B)  the asset incurred to produce future benefits 
C)  a dollar measure of the cash used to achieve a given benefit 
D)  the amount sacrificed for goods expected to bring future benefit to the organization 
A)  the equivalent of the cost of goods sold 
B)  the asset incurred to produce future benefits 
C)  a dollar measure of the cash used to achieve a given benefit 
D)  the amount sacrificed for goods expected to bring future benefit to the organization

Question 7

Becker Corporation
Information from the records of Becker Corporation for December is as follows: $\begin{array}{lr}
\text { Sales } & \$ 1,230,000 \
\text { Selling and administrative expenses } & 210,000 \
\text { Direct materials used } & 300,000 \
\text { Direct labour } & 350,000 \
\text { Manufacturing overhead } & 455,000
\end{array}$

$\text { Inventories }$
$\begin{array}{lrr}
 & \text { Dec. } 1 & \text { Dec. } 31 \
\text { Direct materials }& \$ 36,000 & \$ 42,000 \
\text { Work-in-process } & 75,000 & 84,000 \
\text { Finished goods } & 69,000 & 57,000
\end{array}$
-Refer to Big Blue Bubble Company. What was the prime cost per unit?

Accepted Answer

A)  $11 
B)  $25 
C)  $30 
D)  $34 
A)  $11 
B)  $25 
C)  $30 
D)  $34

Question 8

Assigning costs tells the accountant who spent the money.

Accepted Answer

A) True 
 B)False

Question 9

Refer to TechCom Inc. What were the total product costs last month?

Accepted Answer

A)  $1,250,000 
B)  $1,300,000 
C)  $1,750,000 
D)  $2,000,000 
A)  $1,250,000 
B)  $1,300,000 
C)  $1,750,000 
D)  $2,000,000

Question 10

What three categories separate the expenses on a manufacturer's income statement?

Accepted Answer

A)  variable, fixed, and direct 
B)  production, period, and indirect 
C)  production, selling, and administrative 
D)  materials, work-in-process, and finished goods 
A)  variable, fixed, and direct 
B)  production, period, and indirect 
C)  production, selling, and administrative 
D)  materials, work-in-process, and finished goods

Question 11

Match each of the following terms with their correct description from the items listed below.
-Sales - cost of goods sold

Accepted Answer

A) Gross Margin 
B) Selling Expenses 
C) Sales Revenue 
D) Cost of Goods Sold 
E) Operating Income 
A) Gross Margin 
B) Selling Expenses 
C) Sales Revenue 
D) Cost of Goods Sold 
E) Operating Income

Question 12

Refer to ComPrint Co. What was the amount of cost of goods sold for the year?

Accepted Answer

A)  $97,500 
B)  $102,000 
C)  $106,500 
D)  $128,500 
A)  $97,500 
B)  $102,000 
C)  $106,500 
D)  $128,500

Question 13

Expired costs are called assets.

Accepted Answer

A) True 
 B)False

Question 14

Match each of the following terms with their correct description from the items listed below.
-Direct materials + direct labour + manufacturing overhead

Accepted Answer

A) Work-in-Process Inventory 
B) Finished Goods Inventory 
C) Cost of Goods Sold 
D) Cost of Goods Manufactured 
E) Total Manufacturing Costs 
A) Work-in-Process Inventory 
B) Finished Goods Inventory 
C) Cost of Goods Sold 
D) Cost of Goods Manufactured 
E) Total Manufacturing Costs

Question 15

Explain the difference between an inventoriable cost and a non-inventoriable cost.

Accepted Answer

An inventoriable cost is a cost of manuf

Question 16

Match each of the following terms with their correct description from the items listed below.
-Gross margin - selling and administrative expenses

Accepted Answer

A) Income Statement 
B) Cost of Goods Manufactured 
C) Work-in-Process Inventory 
D) Gross Margin 
E) Operating Income 
A) Income Statement 
B) Cost of Goods Manufactured 
C) Work-in-Process Inventory 
D) Gross Margin 
E) Operating Income

Question 17

n June, Olympic Company purchased materials costing $38,000, and incurred direct labour costs of $42,000. Manufacturing overhead totalled $27,000 for the month. Information on inventories was as follows.
June 1 June 30
Materials $3,000 $2,700
Work-in-process 1,000 1,275
Finished goods 2,500 1,775
Required:
A. Calculate the cost of direct materials used during June.
B. Calculate the total manufacturing cost for June.
C. Calculate the cost of goods manufactured for June.
D. Calculate cost of goods sold for June.

Accepted Answer

A. Materials, 6/1 $ 3,000
Purchases 38,0

Question 18

Gross margin equals revenue minus cost of goods manufactured.

Accepted Answer

A) True 
 B)False

Question 19

Match each of the following terms with their correct description from the items listed below.
-The cost of units finished but NOT sold at the end of the current period

Accepted Answer

A) Work-in-Process Inventory 
B) Finished Goods Inventory 
C) Cost of Goods Sold 
D) Cost of Goods Manufactured 
E) Total Manufacturing Costs 
A) Work-in-Process Inventory 
B) Finished Goods Inventory 
C) Cost of Goods Sold 
D) Cost of Goods Manufactured 
E) Total Manufacturing Costs

Question 20

See the following separate cases.
Case #1 Case #2
Purchase of materials $ 5,000 C
Materials inventory (beginning balance) A 220
Materials inventory (ending balance) 1,000 350
Direct labour 7,000 4,250
Factory supervision 1,500 1,100
Factory supplies 1,250 900
Total manufacturing costs 14,500 D
Work-in-process inventory (beginning balance) 1,200 1,230
Work-in-process inventory (ending balance) B 650
Cost of goods manufactured 14,600 10,200
Required: Solve for the missing amounts (A, B, C, and D).

Accepted Answer

Case #1 Case #2
Purchases of materials $

How is conversion cost calculated?

Reducing the cost required to achieve a given benefit means that a company is becoming less efficient.

Match each of the following terms with their correct description from the items listed below. -Number of units sold multiplied by sales price per unit

Rizzuto Company supplied the following information for the month of January. Cost of goods sold percentage 62% Selling expense percentage 6% Administrative expense 13% Required: Reconstruct Rizzuto's Income Statement for January assuming that the total sales revenue for the month equalled $500,000.

In terms of managerial accounting, what is the best definition of cost?

Assigning costs tells the accountant who spent the money.

Refer to TechCom Inc. What were the total product costs last month?

What three categories separate the expenses on a manufacturer's income statement?

Match each of the following terms with their correct description from the items listed below. -Sales - cost of goods sold

Refer to ComPrint Co. What was the amount of cost of goods sold for the year?

Expired costs are called assets.

Match each of the following terms with their correct description from the items listed below. -Direct materials + direct labour + manufacturing overhead

Explain the difference between an inventoriable cost and a non-inventoriable cost.

Match each of the following terms with their correct description from the items listed below. -Gross margin - selling and administrative expenses

Gross margin equals revenue minus cost of goods manufactured.

Match each of the following terms with their correct description from the items listed below. -The cost of units finished but NOT sold at the end of the current period

Introduction to Managerial Accounting

Cost Behaviour

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing, and Inventory Management

Budgeting, Production, Cash, and Master Budget

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Filters

Exam 2: Basic Managerial Accounting Concepts

How is conversion cost calculated?

Reducing the cost required to achieve a given benefit means that a company is becoming less efficient.

Match each of the following terms with their correct description from the items listed below. -Number of units sold multiplied by sales price per unit

Rizzuto Company supplied the following information for the month of January. Cost of goods sold percentage 62% Selling expense percentage 6% Administrative expense 13% Required: Reconstruct Rizzuto's Income Statement for January assuming that the total sales revenue for the month equalled $500,000.

In terms of managerial accounting, what is the best definition of cost?

Assigning costs tells the accountant who spent the money.

Refer to TechCom Inc. What were the total product costs last month?

What three categories separate the expenses on a manufacturer's income statement?

Match each of the following terms with their correct description from the items listed below. -Sales - cost of goods sold

Refer to ComPrint Co. What was the amount of cost of goods sold for the year?

Expired costs are called assets.

Match each of the following terms with their correct description from the items listed below. -Direct materials + direct labour + manufacturing overhead

Explain the difference between an inventoriable cost and a non-inventoriable cost.

Match each of the following terms with their correct description from the items listed below. -Gross margin - selling and administrative expenses

Gross margin equals revenue minus cost of goods manufactured.

Match each of the following terms with their correct description from the items listed below. -The cost of units finished but NOT sold at the end of the current period

Introduction to Managerial Accounting

Cost Behaviour

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing, and Inventory Management

Budgeting, Production, Cash, and Master Budget

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Performance Evaluation and Decentralization

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

Filters