Exam 1: Managerial Accounting Concepts and Principles

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

Raw materials that become part of a product and are identified with specific units or batches of a product are called direct materials.

Craigmont Company's direct materials costs are $3,000,000, its direct labor costs total $7,000,000, and its factory overhead costs total $5,000,000. Its prime costs total:

Total manufacturing costs incurred during the year do not include:

Period costs for a manufacturing company flow directly to:

Direct materials are not easily traced to a product.

________ inventory consists of products in the process of being manufactured but not yet complete.

What is managerial accounting and how is it used to aid decision makers?

Beginning finished goods inventory plus cost of goods manufactured equals cost of goods sold.

Total quality management (TQM) focuses on quality improvement to business activities.

The following costs are incurred by Gonzalez Manufacturing Co. Classify each cost item as either a period cost or a product cost. If the cost is a product cost, identify it as a prime and/or conversion cost. Place an x in the appropriate column for your answers. Period Cost Product Cost Prime Cost Conversion Cost Factory property taxes. Payroll taxes for assembly labor. Depreciation of factory equipment. Insurance on delivery vehicles Indirect materials used Wages of production workers. Production supervisor's salary Advertising Direct materials used. Sales salaries.