question

Which of the following is an objective of managerial accounting?

answer

to provide information to business managers to assist them in controlling their business

question

Managerial accounting information for a company is primarily used by ________.

answer

its employees to plan and control operations

question

Which of the following is the primary objective of managerial accounting?

answer

providing information that managers need to make operational decisions

question

Managerial accounting includes the planning function. Which of the following items would be part of the planning function of a business's managerial accounting?

answer

creating detailed budgets

question

Which of the following is the primary focus of financial accounting?

answer

providing summarized information on operational results to investors and creditors

question

Management's accountability to its suppliers and vendors is to ________.

answer

make timely payments and comply with contract terms

question

________ is a philosophy of continuous improvement of products and processes.

answer

Total Quality Management (TQM)

question

What is Total Quality Management (TQM)?

answer

a philosophy of supplying customers with superior products and services

question

Which of the following is a philosophy designed to integrate all organizational areas in order to provide customers with superior products and services, while meeting organizational goals throughout the value chain?

answer

Total Quality Management (TQM)

question

Which of the following describes a system in which suppliers deliver materials at the time they are needed and finished units are completed when customer orders need to be filled?

answer

Just-in-Time (JIT) Management

question

An Enterprise Resource Planning system (ERP) ________.

answer

integrates all worldwide functions, departments, and data of a company into a single system

question

Which of the following is one of the key standards of ethical practice published by the Institute of Management Accountants (IMA)?

answer

confidentiality

question

Seria, Inc. has received a bulk order from an overseas client. As a result, the reported earnings of this year are expected to be significantly higher than the estimates of financial analysts. Joshua, an accountant at Seria, tells this to one of his friends. Which of the IMA standards has Joshua violated?

answer

confidentiality

question

You did not understand what the term accrual meant and failed to accrue the interest due at the end of the year on the company's bonds. Which of the IMA standards appears to have been violated here?

answer

competence

question

The income statement of a service company will most likely include ________.

answer

salaries expense

question

Which of the following is true of service companies?

answer

Service companies carry no inventories of products for sale.

question

Which of the following is most likely a service company?

answer

a law firm

question

One of the primary activities of Rex, Inc. is to purchase hats from Viva, Inc. in Texas and sell them to its customers in Washington for a profit. It is likely that Rex is a ________.

answer

merchandising company

question

Product costs are expensed ________.

answer

when the products are consumed or sold

question

Which of the following is a product cost for a manufacturing company?

answer

wages paid to factory janitor

question

Which of the following would be considered a product cost for a manufacturing business?

answer

property taxes on the factory

question

Which of the following would be considered a product cost for a manufacturing company?

answer

salary of the production manager

question

Which of the following would be considered a product cost for a manufacturing company?

answer

depreciation on manufacturing equipment

question

For decision-making purposes, ________ costs are often divided into prime costs and conversion costs.

answer

product costs

question

Which of the following is true of product costs?

answer

They are first recorded in an inventory account.

question

A company that uses labor, equipment, supplies, and facilities to convert raw materials into finished products is a ________.

answer

manufacturing company

question

The balance sheet of a ________ company will include Work-in-Process Inventory as a line item.

answer

manufacturing

question

Goods that have been started in the manufacturing process but are not yet complete are included in the ________.

answer

Work-in-Process Inventory account

question

Which of the following would appear as a line item on the income statements of both a merchandiser and a manufacturer?

answer

Cost of Goods Sold

question

Partial income statements of Company A and Company B are provided below: Company A Revenue $80,000 Expenses: Utilities Expense $5,000 Salaries Expense 15,000 Rent Expense 3,2000 Total Expenses 23,700 Operating Income $56,300 Company B Revenue $50,000

answer

Company A is a service company.

question

The Work-in-Process Inventory account includes the ________.

answer

goods that are partially completed

question

Which of the following formulas represents cost of goods sold for a merchandising business?

answer

Beginning Merchandise Inventory + Purchases and Freight In minus− Ending Merchandise Inventory = Cost of Goods Sold

question

Anything for which managers want a separate measurement of cost is called a ________.

answer

cost object

question

Period costs are the ________.

answer

costs that are incurred and expensed during the same accounting period

question

Which of the following is an example of a period cost for a manufacturing company?

answer

advertising expense

question

For a manufacturing company, which of the following is a period cost?

answer

office rent

question

Which of the following would be considered a period cost for a manufacturing company?

answer

sales salaries

question

Which of the following is a part of manufacturing overhead?

answer

factory insurance

question

Which of the following is an example of direct labor cost in a factory?

answer

wages of assembly line personnel

question

Kyanite Corporation, a manufacturer, reports costs for the year as follows: Direct Materials Used $ 535 comma 000$535,000 Wages to Line Workers 385 comma 000385,000 Office Rent 12 comma 50012,500 Indirect Materials Used 755 comma 000755,000 How much is the total period costs for Kyanite?

answer

$12,500

question

The following information was obtained from Fizz, Inc. How much were Fizz's period costs?

answer

$654,650

question

Daryl Corporation reports costs for the year as follows:How much is the total product costs for the year?

answer

$1,760,000

question

The following information was obtained from MCB Manufacturing, Inc. Calculate MCB Manufacturing's total product costs.

answer

$140,720

question

Which of the following would be considered a direct labor cost for a manufacturing company?

answer

wages of the assembly line staff

question

Which of the following would be included as indirect manufacturing costs for a manufacturing company?

answer

wages of the factory manager

question

Which of the following would be included as manufacturing overhead for a manufacturing company?

answer

indirect materials cost

question

Which of the following is a prime cost and a conversion cost?

answer

direct labor

question

Which of the following represents the combined sum of direct labor and manufacturing overhead?

answer

conversion costs

question

Which of the following represents the combined sum of direct materials and direct labor?

answer

prime costs

question

Which of the following will be classified as a conversion cost?

answer

depreciation on factory equipment

question

Which of the following would be classified as a prime cost?

answer

cost of direct materials used

question

Viva, Inc. has provided the following information for the year:How much is the cost of goods sold?

answer

$1,279,000

question

Goods that are produced by a manufacturing company and are ready to sell are recorded in the _______ account.

answer

Finished Goods Inventory

question

Barricades Corporation provided the following information for the year. What was the amount of direct materials used in production during the year?

answer

$387,000

question

KRD Supplies Corporation provided the following information for the year. What was the amount of the manufacturing overhead costs?

answer

$313,000

question

Amoeba Manufacturing, Inc. provided the following information for the year: What is the ending balance in the Raw Materials Inventory account?

answer

$24,640

question

Evanston Manufacturing, Inc. reported the following information for the year. What was the unit product cost? (Round your answer to the nearest cent.)

answer

$1.77

question

Star Health, Inc. is a fitness center in Oklahoma City. In October, the company earned $ 557 comma 000$557,000 in revenues and incurred the following operating costs from 400400 customers:

answer

$104.13

question

Five Seasons is a merchandiser of packed foods. The company provides the following information for the year: How much was the unit cost per item of product sold? (Round your answer to the nearest cent.)

answer

$3.15

question

Which of the following would use a process costing system rather than a job order costing system?

answer

a paint manufacturer

question

Which of the following businesses is most likely to use a process costing system?

answer

a candy manufacturer

question

The entry to record the purchase of direct materials on account would include a ________.

answer

debit to the Raw Materials Inventory account

question

Which of the following accounts would be debited in the journal entry to record the issuance of direct materials?

answer

Work-in-Process Inventory

question

Manufacturing Overhead is a temporary account used to ________ indirect production costs during the accounting period.

answer

accumulate

question

The journal entry to issue indirect materials to production should include a debit to the ________.

answer

Manufacturing Overhead account

question

Uniq Works purchased raw materials amounting to $ 129 comma 000$129,000 on account and $ 19 comma 000$19,000 for cash. The materials will be used to manufacture upholstery for furniture manufacturers on a contract basis. Which of the following journal entries correctly records this transaction?

answer

Raw Materials Inventory 148 comma 000148,000 Cash 19 comma 00019,000 Accounts Payable 129 comma 000129,000

question

The accounts of Delphinia Dreams, Inc. showed the following balances at the beginning of October:During the month, direct materials amounting to $ 20 comma 000$20,000 and indirect materials amounting to $ 5 comma 000$5,000 were issued to production. What is the ending balance in the Workminus−inminus−Process Inventory account following these two transactions?

answer

$60,000

question

On June 1, Dalton Productions had beginning balances as shown in the Tminus−accounts belowDuring June, the following transactions took place: June 2: Issued $ 2 comma 900$2,900 of direct materials and $ 400$400 of indirect materials to production. What was the balance in the Manufacturing Overhead account following this transaction?

answer

$41,400

question

The journal entry to record indirect labor costs incurred involves a debit to the ________.

answer

Manufacturing Overhead account

question

Which of the following will be categorized as a manufacturing overhead cost?

answer

depreciation on factory plant and equipment

question

Which of the following will be debited to the Manufacturing Overhead account of a watch manufacturer?

answer

factory electricity costs

question

Which of the following describes the allocation base for allocating manufacturing overhead costs?

answer

the primary cost driver of indirect manufacturing costs

question

When a job order costing system is used, actual manufacturing overhead costs are debited to ________.

answer

the Manufacturing Overhead account

question

Which of the following correctly describes the term cost driver?

answer

the primary factor that causes a cost to be incurred

question

The predetermined overhead allocation rate is the rate used to ________.

answer

allocate estimated manufacturing overhead costs to jobs

question

The predetermined overhead allocation rate is calculated by dividing ________.

answer

the estimated overhead costs by total estimated quantity of the overhead allocation base

question

The predetermined overhead allocation rate for a given production year is calculated ________.

answer

before the accounting period begins

question

Aaron, Inc. estimates direct labor costs and manufacturing overhead costs for the coming year to be $ 770 comma 000$770,000 and $ 530 comma 000$530,000, respectively. Aaron allocates overhead costs based on machine hours. The estimated total labor hours and machine hours for the coming year are 16 comma 00016,000 hours and 9 comma 0009,000 hours, respectively. What is the predetermined overhead allocation rate? (Round your answer to the nearest cent.)

answer

$58.89 per machine hour

question

Zephyros Corporation had estimated manufacturing overhead costs for the coming year to be $ 301 comma 000$301,000. The total estimated direct labor hours and machine hours for the coming year are 7 comma 0007,000 and 12 comma 00012,000, respectively. Manufacturing overhead costs are allocated based on direct labor hours. What is the predetermined overhead allocation rate? (Round your answer to the nearest cent.)

answer

$43.00 per direct labor hour

question

The Equinox Fabrication Plant suffered a fire incident in August, and most of the records for the year were destroyed. The following accounting data for the year were recovered:

answer

$33.66

question

Archangel Manufacturing calculated a predetermined overhead allocation rate at the beginning of the year based on a percentage of direct labor costs. The production details for the year are given below:

answer

40%

question

Sybil, Inc. uses a predetermined overhead allocation rate to allocate manufacturing overhead costs to jobs. The company recently completed Job 300X. This job used 1111 machine hours and 33 direct labor hours. The predetermined overhead allocation rate is calculated to be $ 41$41 per machine hour. What is the amount of manufacturing overhead allocated to Job 300X using machine hours as the allocation base?

answer

$559

question

Caltran, Inc. completed manufacturing Job 445. It included $ 320$320 of direct materials cost, $ 1 comma 240$1,240 of direct labor cost, and $ 540$540 of allocated manufacturing overhead. Which of the following is the correct journal entry needed to record the completed job?

answer

Finished Goods Inventory 2 comma 1002,100 Workminus−inminus−Process Inventory 2 comma 1002,100

question

On June 30, Caroline, Inc. finished Job 750 with total job costs of $ 4 comma 700$4,700 and transferred the costs to Finished Goods Inventory. On July 6, Caroline completed the sale of the goods from Job 750 to a customer for $ 6 comma 000$6,000 cash. Which of the following is the correct entry needed to record the revenue earned?

answer

debit Cash $ 6 comma 000$6,000 and credit Sales Revenue $ 6 comma 000$6,000

question

On June 30, Coral, Inc. finished Job 750 with total job costs of $ 4 comma 200$4,200, and transferred the costs to Finished Goods Inventory. On July 6, it completed the sale of the goods to a customer for $ 5 comma 900$5,900 cash. Which of the following is the correct journal entry to record the cost of goods sold?

answer

debit Cost of Goods Sold $ 4 comma 200$4,200 and credit Finished Goods Inventory $ 4 comma 200$4,200

question

On January 1, Feldstein Manufacturing had a beginning balance in Workminus−inminus−Process Inventory of $ 80 comma 800$80,800 and a beginning balance in Finished Goods Inventory of $ 20 comma 000$20,000. During the year, Feldstein incurred manufacturing costs of $ 352 comma 500$352,500.

answer

$81,000 debit balance

question

At the end of the year, Beta, Inc. has an unadjusted debit balance in the Manufacturing Overhead account of $ 3 comma 990$3,990. The adjusting journal entry needed to adjust the balance to zero will include a ________.

answer

debit to Cost of Goods Sold $ 3 comma 990$3,990 and credit to Manufacturing Overhead $ 3 comma 990$3,990

question

At the end of the year, Metro, Inc. has an unadjusted credit balance in the Manufacturing Overhead account of $ 910$910. Which of the following is the yearminus−end adjusting entry needed to adjust the account?

answer

A debit to Manufacturing Overhead of $ 910$910 and a credit to Cost of Goods Sold of $ 910$910

question

On January 1 Primary Manufacturing had a beginning balance in Workminus−inminus−Process Inventory of $ 81 comma 100$81,100 and a beginning balance in Finished Goods Inventory of $ 20 comma 000$20,000. During the year, Primary incurred manufacturing costs of $ 350 comma 000$350,000.

answer

$321,000 debit balance

question

On January 1, Frederic Manufacturing had a beginning balance in Workminus−inminus−Process Inventory of $ 161 comma 000$161,000 and a beginning balance in Finished Goods Inventory of $ 24 comma 000$24,000. During the year, Frederic incurred manufacturing costs of $ 203 comma 000$203,000.

answer

$300,000 debit balance

question

Highland, Inc., an engineering firm, uses a job order costing system to accumulate clientminus−related costs. The predetermined overhead allocation rate is 6060% of staff labor cost. The work by engineers is charged to jobs at a rate of $ 30$30 per staff labor hour. A recent job for a client used 6060 staff labor hours. How much was the total job cost?

answer

$2,880

question

Bass Accounting Services expects its accountants to work a total of 24 comma 00024,000 direct labor hours per year. The company's estimated total indirect costs are $ 288 comma 000$288,000. The company uses direct labor hours as the allocation base for indirect costs. What is the indirect cost allocation rate? (Round your answer to the nearest cent.)

answer

$12.00 per hour

question

Bacon Financial Advisors provides accounting and finance assistance to customers in the retail business. Bacon has four professionals on staff and an office with six clerical staff. Total compensation, including benefits, for the professional staff runs about $ 571 comma 000$571,000 per year, and normal billable hours are 8 comma 3008,300 hours per year. The professional staff keep detailed time sheets organized by client number. The total office and administrative costs for the year are $ 754 comma 000$754,000. What is the direct labor rate for the professional staff? (Round your answer to the nearest cent.)

answer

$68.80 per hour

question

Seal Financial Advisors provides accounting and finance assistance to customers in the retail business. Seal has four professionals on staff and an office with six clerical staff. Total compensation, including benefits, for the professional staff runs about $ 573 comma 000$573,000 per year, and normal billable hours are 8 comma 2008,200 hours per year. The professional staff keep detailed time sheets organized by client number. The total office and administrative costs for the year are $ 756 comma 000$756,000. Seal allocates office and administrative costs to clients monthly, using a predetermined overhead allocation rate based on billable hours. What is the predetermined overhead allocation rate that Seal will use for office and administrative costs? (Round your answer to the nearest cent.)

answer

$92.20 per hour

question

Fogelin Promotional Services uses a job order system for costing and billing promotional services for dance and ballet performances. Fogelin has four public relations specialists and office staff. At the beginning of the year, Fogelin estimated the total cost of salaries and benefits for the public relations specialists at $ 403 comma 800$403,800 and a total of 7 comma 1007,100 billable hours for the year. The office and administrative costs were estimated at $ 673 comma 000$673,000. What direct labor rate would Fogelin use for the cost of its specialists? (Round your answer to the nearest cent.)

answer

$56.87

Accounting chapters 18 & 19 – Flashcards

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