Exam 15: Managerial Accounting and Cost Concepts

The Chief Financial Officer (CFO)of your company has asked you to help her develop a cost control report to be distributed within the company.She wants your input concerning what she should think about before developing such a report.Discuss the significant points,in detail,the CFO should consider before the cost control report is prepared. In addition to identifying the Why,Who,What,and When of the report,students should address the specific points that need to be considered under each topic. Why: What is the purpose of the report? Is the intent to report on total costs or is the report going to be concerned with specific costs? Are the costs being considered for the entire company or for specific segments of the company?

Management accounting is a subordinate activity to financial accounting.

The income statement for a manufacturing company usually contains a detailed computation of the

Give two examples of each stage in the management process.

Product unit cost is made up of direct materials and indirect materials only.

Which of the following accounts contain only one type of product cost?

Both direct and indirect labor costs can be directly traced to finished products.

Total manufacturing costs and the change in the Work in Process Inventory are used to compute the cost of goods sold.

When there is an ethical conflict,the management accountant should resign if the immediate supervisor is involved in the conflict.

Which of the following is not a product cost?

Yamishi Production had the following inventories for the first quarter of 2014: Purchases of materials during the quarter were $427,800.Total direct labor costs were incurred in the amount of $1,482,000.Actual overhead costs were incurred as follows: operating supplies used,$17,100;janitorial and maintenance,$87,300;employee benefits,$26,400;utilities,$162,000;depreciation of factory,$43,200;property taxes,$24,000;factory insurance,$29,000.Net sales for the quarter were $3,562,200.Selling and administrative expenses were $508,000.Income taxes should be computed at 40 percent. Prepare a statement of cost of goods manufactured for the first quarter of 2014.

Managerial accounting reports should be prepared when they are needed,without regard to calendar dates or regularity of issue.

Financial accounting reports are prepared on a periodic basis.

Total variable costs remain constant within a defined time period or range of activity.

Materials and supplies that cannot be traced conveniently to specific products are called

Which of the following is not one of the key questions to be addressed when preparing an accounting report?

Fixed costs remain constant within a defined range of activity or time period.

Manufacturing costs incurred in an accounting period cannot be included in the cost of goods sold for the subsequent accounting period.

Period costs flow through three types of inventory accounts before becoming part of the cost of goods sold amount.

The Finished Goods Inventory and the Cost of Goods Sold for a manufacturing company for the year 2014 are as follows: May 1 Finished Goods Inventory,$470,500;May 31 Finished Goods Inventory,$125,000;Cost of Goods Sold for the year,$1,110,000.The cost of goods manufactured for the month was