Exam 14: Managerial Accounting Concepts and Principles

Use the following information to compute the cost of goods manufactured: Beginning finished goods inventory \ 65,000 Beginning goods in process inventory 81,000 Beginning raw materials 73,000 Depreciation on factory equipment 7,000 Direct labor 25,000 Ending finished goods inventory 67,000 Ending goods in process inventory 79,000 Ending raw materials 60,000 Factory repairs and maintenance 12,000 Raw material purchases 50,000

The following costs are included in a recent summary of data for a company: advertising expense $85,000; depreciation expense - factory building $133,000; direct labor $250,000; direct material used $300,000; factory utilities $105,000; and sales salaries expense $150,000. Determine the dollar amount of conversion costs.

The Institute of Management Accountants has developed a code of ethics which requires management accountants to behave in certain ways. Which of the following behaviors is not required?

The manufacturing statement must be prepared monthly as it is a required general-purpose financial statement.

Assume Kernel Season receives and produces an order for 1,750 cases of popcorn seasoning and that the following times were measured during production of this order: Process time 4.2 days Inspection time 2.8 days Move time 3.5 days Wait time 10.5 days (a) Compute the company's manufacturing cycle time. (b) Compute the company's manufacturing cycle efficiency. (c) Interpret these results. What can the company do to improve these measures?

For a manufacturer, the cost of goods sold can be computed by adding the beginning finished goods inventory to ________________________ and then subtracting the ending finished goods inventory.

Whether a cost is controllable or not controllable by an employee depends on the employee's level of responsibility.

Prime costs consist of direct labor and factory overhead.

Bourne Crafts manufactures specialty key chains for tourist attractions. On December 31, 2009, the firm had 200 souvenir attraction disks used in the production of the chains that cost $3 each; and 600 completed key chains that cost $6 each. During year 2010 Bourne Crafts purchased 1,500 souvenir disks costing $3 each and produced 1,100 key chains. Required: Determine the total cost of raw materials inventory at December 31, 2010.

An approach to managing inventories and production operations such that units of materials and products are obtained and provided only as they are needed is called:

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

Cycle time equals process time plus inspection time plus move time plus wait time.

An attitude of constantly seeking ways to improve company operations, including customer service, product quality, product features, the production process, and employee interactions, is called:

Managerial accounting information can be forwarded to the managers of a company quickly since external auditors do not have to review it, and estimates and projections are acceptable.

Materials that are used in support of the production process but that do not become a part of the product and are not clearly identified with units or batches of product are called:

The following information relates to the manufacturing operations of the IMH Publishing Corporation for the year: Beginning Ending Raw materials inventory \ 57,000 \ 60,000 Finished goods 68,000 60,000 The raw materials used in manufacturing during the year totaled $118,000. Raw materials purchased during the year amount to:

The beginning and ending finished goods inventories of the Prize Ring manufacturing company were $75,000 and $73,000 respectively. If cost of goods sold equaled $66,000, what is the amount of cost of goods manufactured for this period?

The series of activities that add value to a company's products or services is called a value chain.

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

The following information for Baldwin Company, as of December 31, is provided. Administrative salaries \ 24,000 Depreciation of factory equipment 18,750 Depreciation of delivery vehicles 6,000 Direct labor 51,000 Factory supplies used 9,000 Finished goods inventory, January 1 42,750 Finished goods inventory, December 31 52,000 Factory insurance 11,625 Interest expense 10,000 Factory utilities 10,500 Factory maintenance 5,625 Raw materials inventory, January 1 7,000 Raw materials inventory, December 31 3,500 Raw material purchases 94,000 Rent on factory equipment 18,750 Repairs of factory equipment 8,600 Sales commissions 28,150 Goods in process inventory, January 1 4,000 Goods in process inventory, December 31 2,500 A. Calculate the direct material used during the period. B. Calculate the total manufacturing costs incurred during the period. C. Calculate the Cost of Goods Manufactured during the period. D. Calculate the Cost of Goods Sold during the period.