Exam 1: Managerial Accounting Concepts and Principles

A lean business model aims to eliminate waste while satisfying the customer and providing a positive return to the company.

Current information for the Stellar Corporation follows: Beginning work in process inventory \ 17,900 Ending work in process inventory 19,300 Direct materials used 147,000 Direct labor used 85,000 Total factory overhead 63,100 Stellar Corporation's cost of goods manufactured for the year is:

There are many differences between financial and managerial accounting. Identify and explain at least three of these differences.

Under a just-in-time manufacturing system, large quantities of inventory are accumulated throughout the factory to be certain that components are available each time that they are needed.

A ________ system means that a company acquires or produces inventory only when needed.

The main difference between the cost of goods sold of a manufacturer and a merchandiser is that the merchandiser includes cost of goods manufactured rather than cost of goods purchased.

Which of the following costs is not included in factory overhead?

Labor costs that are clearly associated with specific units of product because the labor is used to convert raw materials into finished products are called:

Use the cost information below for Ruiz, Inc. to determine cost of goods manufactured for the year:

Which of the following items is not a management concept that was created to improve company performance?

An internal control system consists of the policies and procedures managers use to do all of the following except:

Total variable costs change in proportion to changes in the volume of activity.

Cost concepts such as variable, fixed, mixed, direct, and indirect apply only to manufacturers and not to service companies.

A schedule of cost of goods manufactured is also known as a:

Using the information below, calculate the cost of goods manufactured for the period: Beginning Raw Materials Inventory \ 25,000 Ending Raw Materials Inventory 30,000 Beginning Work in Process Inventory 55,000 Ending Work in Process Inventory 64,000 Beginning Finished Goods Inventory 80,000 Ending Finished Goods Inventory 67,000 Cost of Goods Sold for the period 540,000 Sales Revenues for the period 1,254,000 Operating Expenses for the period 232,000

Managerial accounting provides financial and nonfinancial information to an organization's managers and other internal decision makers.

Product costs can be classified as one of three types: direct materials, direct labor, or factory overhead.

Walter Co. and Sandburg Industries report the following information at December 31: WALTER SANDBURG Accounts Receivable \ 41,000 \ 68,000 Cash 6,000 7,000 Finished Goods Inventory 25,000 Work in Process Inventory 40,000 Merchandise Inventory 48,000 Prepaid Expenses 1,000 2,000 Raw Materials Inventory 21,000 Required: (a) Which company is a manufacturer? Explain. (b) Prepare the current assets section of the balance sheet for the manufacturer.

Costs that are capitalized as inventory when they are incurred are called:

Control is the process of setting goals and determining ways to achieve them.