Question 1

The Sharpe Company reports the following information for 2015:  Determine period costs for 2015.

Accepted Answer

A)  $24,500 
B)  $30,300 
C)  $29,200 
D)  $35,000 
A)  $24,500 
B)  $30,300 
C)  $29,200 
D)  $35,000

Question 2

Differentiate between financial and managerial accounting, addressing such issues as what reports are generated, when, and for whom.

Accepted Answer

The answer of Differentiate between financial and managerial accounting, addressing...

Question 3

Managerial accountants would most likely prepare all of the following reports except:

Accepted Answer

A)  A performance report identifying amounts of scrap. 
B)  A control report comparing direct material usage over time. 
C)  A sales report targeting monthly sales and potential bonuses. 
D)  An annual report for external regulators such as the SEC. 
A)  A performance report identifying amounts of scrap. 
B)  A control report comparing direct material usage over time. 
C)  A sales report targeting monthly sales and potential bonuses. 
D)  An annual report for external regulators such as the SEC.

Question 4

Factory overhead includes:

Accepted Answer

A)  factory rent and direct labor 
B)  direct materials and direct labor 
C)  indirect materials and direct materials 
D)  indirect labor and indirect materials 
A)  factory rent and direct labor 
B)  direct materials and direct labor 
C)  indirect materials and direct materials 
D)  indirect labor and indirect materials

Question 5

All of the following would probably be considered a direct material except:

Accepted Answer

A)  steel 
B)  fabric 
C)  glue 
D)  lumber 
A)  steel 
B)  fabric 
C)  glue 
D)  lumber

Question 6

Which of the following is not a characteristic of useful managerial accounting reports?

Accepted Answer

A)  Accuracy 
B)  GAAP 
C)  historical and estimated data 
D)  reports prepared as needed 
A)  Accuracy 
B)  GAAP 
C)  historical and estimated data 
D)  reports prepared as needed

Question 7

Indirect labor and indirect materials are classified as:

Accepted Answer

A)  factory overhead and product costs 
B)  factory overhead and period costs 
C)  operating costs and period costs 
D)  operating costs and product costs 
A)  factory overhead and product costs 
B)  factory overhead and period costs 
C)  operating costs and period costs 
D)  operating costs and product costs

Question 8

Finished goods inventory is reported on the:

Accepted Answer

A)  income statement as a period cost 
B)  balance sheet as a long-term asset 
C)  balance sheet as a current asset 
D)  income statement as revenue 
A)  income statement as a period cost 
B)  balance sheet as a long-term asset 
C)  balance sheet as a current asset 
D)  income statement as revenue

Question 9

At the beginning of 2011, the Gilbert Company's work in process inventory account had a balance of $30,000. During 2011, $68,000 of direct materials were used in production, and $66,000 of direct labor costs were incurred. Factory overhead in 2011 amounted to $90,000. Cost of goods manufactured is $230,000 in 2011. The balance in work in process inventory on December 31, 2011, is:

Accepted Answer

A)  $24,000 
B)  $44,000 
C)  $66,000 
D)  $36,000 
A)  $24,000 
B)  $44,000 
C)  $66,000 
D)  $36,000

Question 10

Conversion costs consist of product costs and period costs.

Accepted Answer

A) True 
 B)False

Question 11

Managerial accounting uses only past data in reports to aid management in the decision making process.

Accepted Answer

A) True 
 B)False

Question 12

Indirect costs incurred in a manufacturing environment that cannot be traced directly to a product are treated as:

Accepted Answer

A)  period costs and expensed when incurred 
B)  product costs and expensed when the goods are sold 
C)  product costs and expenses when incurred 
D)  period costs and expensed when the goods are sold 
A)  period costs and expensed when incurred 
B)  product costs and expensed when the goods are sold 
C)  product costs and expenses when incurred 
D)  period costs and expensed when the goods are sold

Question 13

What is the primary criterion for the preparation of managerial accounting reports?

Accepted Answer

A)  Relevance of the reports 
B)  Meet the manager needs 
C)  Timing of the reports 
D)  Cost of the reports 
A)  Relevance of the reports 
B)  Meet the manager needs 
C)  Timing of the reports 
D)  Cost of the reports

Question 14

The Zoe Corporation has the following information for the month of March. Prepare a (a) schedule of cost of goods manufactured, (b) an income statement for the month ended March 31, and (c) prepare only the inventory section of the balance sheet.

Accepted Answer

The answer of The Zoe Corporation has the following information...

Question 15

If the cost of materials is not a significant portion of the total product cost, the materials may be classified as part of factory overhead cost.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following items would not be classified as part of factory overhead?

Accepted Answer

A)  Direct labor used 
B)  Amortization of manufacturing patents 
C)  Production supervisors' salaries 
D)  Factory supplies used 
A)  Direct labor used 
B)  Amortization of manufacturing patents 
C)  Production supervisors' salaries 
D)  Factory supplies used

Question 17

Managers use managerial information to evaluate performance of a company's operation.

Accepted Answer

A) True 
 B)False

Question 18

Direct labor costs are included in the conversion costs of a product.

Accepted Answer

A) True 
 B)False

Question 19

The controller's staff often consists of several management accountants. All of the following would most likely be on the controller's staff EXCEPT:

Accepted Answer

A)  general accountants 
B)  budgets and budget analysts 
C)  investments and shareholder relations managers 
D)  cost accountants 
A)  general accountants 
B)  budgets and budget analysts 
C)  investments and shareholder relations managers 
D)  cost accountants

Question 20

Cost of oil used to lubricate factory machinery and equipment is an example of a direct materials cost.

Accepted Answer

A) True 
 B)False

Exam 16: Managerial Accounting Concepts and Principles

The Sharpe Company reports the following information for 2015: Determine period costs for 2015.

Differentiate between financial and managerial accounting, addressing such issues as what reports are generated, when, and for whom.

Managerial accountants would most likely prepare all of the following reports except:

Factory overhead includes:

All of the following would probably be considered a direct material except:

Which of the following is not a characteristic of useful managerial accounting reports?

Indirect labor and indirect materials are classified as:

Finished goods inventory is reported on the:

Conversion costs consist of product costs and period costs.

Managerial accounting uses only past data in reports to aid management in the decision making process.

Indirect costs incurred in a manufacturing environment that cannot be traced directly to a product are treated as:

What is the primary criterion for the preparation of managerial accounting reports?

The Zoe Corporation has the following information for the month of March. Prepare a (a) schedule of cost of goods manufactured, (b) an income statement for the month ended March 31, and (c) prepare only the inventory section of the balance sheet.

If the cost of materials is not a significant portion of the total product cost, the materials may be classified as part of factory overhead cost.

Which of the following items would not be classified as part of factory overhead?

Managers use managerial information to evaluate performance of a company's operation.

Direct labor costs are included in the conversion costs of a product.

The controller's staff often consists of several management accountants. All of the following would most likely be on the controller's staff EXCEPT:

Cost of oil used to lubricate factory machinery and equipment is an example of a direct materials cost.

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Sarbanes-Oxley, Internal Control, and Cash

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

Job Order Costing

Process Cost Systems

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing for Management Analysis

Budgeting

Performance Evaluation Using Variances From Standard Costs

Performance Evaluation for Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

Cost Management for Just-In-Time Environments

Filters