Question 1

A fixed cost:

Accepted Answer

A)  Requires the future outlay of cash and is relevant for future decision making. 
B)  Does not change with changes in the volume of activity within the relevant range. 
C)  Is directly traceable to a cost object. 
D)  Changes with changes in the volume of activity within the relevant range. 
E)  Is irrelevant for managers' decision making. 
A)  Requires the future outlay of cash and is relevant for future decision making. 
B)  Does not change with changes in the volume of activity within the relevant range. 
C)  Is directly traceable to a cost object. 
D)  Changes with changes in the volume of activity within the relevant range. 
E)  Is irrelevant for managers' decision making.

Question 2

Control is the process of monitoring planning decisions and evaluating an organization's activities and employees.

Accepted Answer

A) True 
 B)False

Question 3

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

Accepted Answer

A) True 
 B)False

Question 4

Duncan Crafts manufactures specialty key chains for tourist attractions. On January 1, the firm had 300 souvenir attraction disks, costing $3 each, used in the production of key chains. During the year Duncan Crafts purchased 1,500 souvenir disks costing $3 each and produced 1,100 key chains. Compute the total cost of souvenir disk raw materials inventory at December 31.

Accepted Answer

The answer of Duncan Crafts manufactures specialty key chains for...

Question 5

For each of the characteristics below, identify whether it is a focus of financial accounting
or managerial accounting. Use the letter F to identify financial accounting and M to identify
managerial accounting.
_____ 1. Users are generally investors, creditors, analysts, and regulators.
_____ 2. Used to assist managers in making planning and control decisions.
_____ 3. Information is structured and controlled by GAAP.
_____ 4. Information is available quickly without the need to wait for an audit.
_____ 5. Information is mainly historical with some predictions.
_____ 6. Emphasis of the information is a company's projects, processes, and divisions.
_____ 7. Information is mostly monetary, but includes nonmonetary information.

Accepted Answer

1. F; 2. M

Question 6

Information for Underwood Industries is presented below. Compute the cost of goods manufactured.
 
$\begin{array}{|l|r|r|} 
\hline& \text { Beginning } & \text { Ending } \
\hline \text { Raw materials inventory } & \$ 26,800 & \$ 30,100 \
\hline \text { Work in process inventory } & 41,200 & 39,000 \\hline \text { Finished goods inventory } & 54,00 0& 53,500 \
\hline \text { Raw materials purchased } & 93,50 0 \\hline \text { Direct labor } & 61,000 \
\hline \text { Total factory overhead } & 117,300 \
\hline
\end{array}$

Accepted Answer

The answer of Information for Underwood Industries is presented below....

Question 7

An employee devises a payroll scheme that costs the employer $150. The employer discovers the fraud but decides not to confront the employee since the amount of the fraud is small. Discuss why this course of action is not advisable.

Accepted Answer

While this particular incident resulted

Question 8

Raw materials inventory should not include indirect materials.

Accepted Answer

A) True 
 B)False

Question 9

Asteroid Industries accumulated the following cost information for the year:

$\begin{array}{lr}
\text { Direct materials } & \$ 16,000 \
\text { Indirect materials } & 4,000 \
\text { Indirect labor } & 8,500 \
\text { Factory depreciation } & 12,800 \
\text { Direct labor } & 37,000
\end{array}$ 
Using the above information, total factory overhead costs equal:

Accepted Answer

A)  $78,300. 
B)  $25,300. 
C)  $12,800. 
D)  $16,800. 
E)  $53,000. 
A)  $78,300. 
B)  $25,300. 
C)  $12,800. 
D)  $16,800. 
E)  $53,000.

Question 10

Using the information below, compute the raw materials inventory turnover:

$\begin{array}{lr}
\text {Raw materials used }&\$85,500\
\text {Beginning raw materials inventory }&8,000\\text { Ending raw materials inventory}&9,000\
\end{array}$

Accepted Answer

A)  11.02. 
B)  382.02. 
C)  10.06. 
D)  9.94. 
E)  9.50. 
A)  11.02. 
B)  382.02. 
C)  10.06. 
D)  9.94. 
E)  9.50.

Question 11

Period costs are incurred by manufacturing finished goods.

Accepted Answer

A) True 
 B)False

Question 12

________ reveals how many times a company uses its raw materials inventory in production during a period.

Accepted Answer

Raw materi

Question 13

Wesson Company sold 10,000 units of its only product in the first half of the year. If sales increase by 12% in the second half of the year, which cost will increase?

Accepted Answer

A)  Depreciation on equipment. 
B)  Wages of administrative staff. 
C)  Office rent. 
D)  Direct materials. 
E)  Property insurance. 
A)  Depreciation on equipment. 
B)  Wages of administrative staff. 
C)  Office rent. 
D)  Direct materials. 
E)  Property insurance.

Question 14

Classifying costs by behavior with changes in volume of activity involves:

Accepted Answer

A)  Identifying fixed costs and variable cost. 
B)  Identifying cost of goods sold and operating costs. 
C)  Identifying costs as financial or managerial. 
D)  Identifying costs in a physical manner. 
E)  Identifying both quantitative and qualitative cost factors. 
A)  Identifying fixed costs and variable cost. 
B)  Identifying cost of goods sold and operating costs. 
C)  Identifying costs as financial or managerial. 
D)  Identifying costs in a physical manner. 
E)  Identifying both quantitative and qualitative cost factors.

Question 15

Which of the following is not part of the sales activity in the flow of manufacturing activities?

Accepted Answer

A)  Beginning Finished Goods Inventory. 
B)  Cost of Goods Manufactured. 
C)  Total Finished Goods available for sale. 
D)  Ending Work in Process Inventory. 
E)  Cost of Goods Sold. 
A)  Beginning Finished Goods Inventory. 
B)  Cost of Goods Manufactured. 
C)  Total Finished Goods available for sale. 
D)  Ending Work in Process Inventory. 
E)  Cost of Goods Sold.

Question 16

Which of the following is an indirect cost of manufacturing scooters?

Accepted Answer

A)  Scooter assembly wages. 
B)  Wheels. 
C)  Supervisor salary. 
D)  Brakes 
E)  Assembly worker employee benefits. 
A)  Scooter assembly wages. 
B)  Wheels. 
C)  Supervisor salary. 
D)  Brakes 
E)  Assembly worker employee benefits.

Question 17

Managerial accounting is an activity that helps managers determine costs of products and services, plan future activities, and compare actual to planned results.

Accepted Answer

A) True 
 B)False

Question 18

A management concept based on an understanding of the changing wants and needs of customers, and which leads to flexible product designs and production processes, is called:

Accepted Answer

A)  Continuous improvement. 
B)  Customer orientation. 
C)  Just-in-time. 
D)  Theory of constraints. 
E)  Total quality management. 
A)  Continuous improvement. 
B)  Customer orientation. 
C)  Just-in-time. 
D)  Theory of constraints. 
E)  Total quality management.

Question 19

Indirect labor refers to the cost of workers who assist or supervise manufacturing, but they are not clearly identified with specific product units.

Accepted Answer

A) True 
 B)False

Question 20

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.

Accepted Answer

A) True 
 B)False

A fixed cost:

Control is the process of monitoring planning decisions and evaluating an organization's activities and employees.

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

An employee devises a payroll scheme that costs the employer $150. The employer discovers the fraud but decides not to confront the employee since the amount of the fraud is small. Discuss why this course of action is not advisable.

Raw materials inventory should not include indirect materials.

Asteroid Industries accumulated the following cost information for the year: Direct materials \ 16,000 Indirect materials 4,000 Indirect labor 8,500 Factory depreciation 12,800 Direct labor 37,000 Using the above information, total factory overhead costs equal:

Using the information below, compute the raw materials inventory turnover: Raw materials used \8 5,500 Beginning raw materials inventory 8,000 Ending raw materials inventory 9,000

Period costs are incurred by manufacturing finished goods.

________ reveals how many times a company uses its raw materials inventory in production during a period.

Wesson Company sold 10,000 units of its only product in the first half of the year. If sales increase by 12% in the second half of the year, which cost will increase?

Classifying costs by behavior with changes in volume of activity involves:

Which of the following is not part of the sales activity in the flow of manufacturing activities?

Which of the following is an indirect cost of manufacturing scooters?

Managerial accounting is an activity that helps managers determine costs of products and services, plan future activities, and compare actual to planned results.

A management concept based on an understanding of the changing wants and needs of customers, and which leads to flexible product designs and production processes, is called:

Indirect labor refers to the cost of workers who assist or supervise manufacturing, but they are not clearly identified with specific product units.

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.

Job Order Costing and Analysis

Process Costing and Analysis

Activity-Based Costing and Analysis

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing and Analysis

Master Budgets and Performance Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Relevant Costing for Managerial Decisions

Capital Budgeting and Investment Analysis

Reporting Cash Flows

Analysis of Financial Statements

Time Value of Money

Lean Principles and Accounting

Accounting for Business Transactions

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Exam 1: Managerial Accounting Concepts and Principles

A fixed cost:

Control is the process of monitoring planning decisions and evaluating an organization's activities and employees.

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

An employee devises a payroll scheme that costs the employer $150. The employer discovers the fraud but decides not to confront the employee since the amount of the fraud is small. Discuss why this course of action is not advisable.

Raw materials inventory should not include indirect materials.

Asteroid Industries accumulated the following cost information for the year: Direct materials \ 16,000 Indirect materials 4,000 Indirect labor 8,500 Factory depreciation 12,800 Direct labor 37,000 Using the above information, total factory overhead costs equal:

Using the information below, compute the raw materials inventory turnover: Raw materials used \8 5,500 Beginning raw materials inventory 8,000 Ending raw materials inventory 9,000

Period costs are incurred by manufacturing finished goods.

________ reveals how many times a company uses its raw materials inventory in production during a period.

Wesson Company sold 10,000 units of its only product in the first half of the year. If sales increase by 12% in the second half of the year, which cost will increase?

Classifying costs by behavior with changes in volume of activity involves:

Which of the following is not part of the sales activity in the flow of manufacturing activities?

Which of the following is an indirect cost of manufacturing scooters?

Managerial accounting is an activity that helps managers determine costs of products and services, plan future activities, and compare actual to planned results.

A management concept based on an understanding of the changing wants and needs of customers, and which leads to flexible product designs and production processes, is called:

Indirect labor refers to the cost of workers who assist or supervise manufacturing, but they are not clearly identified with specific product units.

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.

Job Order Costing and Analysis

Process Costing and Analysis

Activity-Based Costing and Analysis

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing and Analysis

Master Budgets and Performance Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Relevant Costing for Managerial Decisions

Capital Budgeting and Investment Analysis

Reporting Cash Flows

Analysis of Financial Statements

Time Value of Money

Lean Principles and Accounting

Accounting for Business Transactions

Filters