Ch 1 Managerial Accounting Concepts and Principles Test Prep – Flashcards

__________ is the philosophy of continually improving employees, business processes, and products. Improvement process Continuous process improvement Quality process None of these choices are correct.

The direct labor costs related to factory workers and manufacturing costs related to machine, rent, depreciation costs are added to: Work in process account Finished goods account Cost of goods sold account All of these choices are correct.

When the completed goods are moved out of the factory, they go to _______ Raw materials account Finished goods account Work in process account Cost of goods sold account

In the cost of goods sold model, the costs flow from the raw materials storeroom to ________ into __________ and into _________. Work-in-process inventory, finished goods inventory, cost of goods sold. Work-in-process inventory, cost of goods sold, sales. Work-in-process inventory, cost of goods sold, finished goods inventory. Cost of goods sold, finished goods inventory, work-in-process.

When the product is sold, the accumulated costs in the ________ are moved to cost of goods sold. Raw materials account Work in process account Finished goods account Sales account

All of the following are considered phases of the management process except planning. directing. controlling. executing.

The process by which managers run day-to-day operations is called planning. directing. executing. None of these choices are correct.

__________ are identified with and can be traced to a cost object. Direct costs Product costs Indirect costs None of these choices are correct.

__________ cannot be identified with or traced to a cost object. Direct costs Product costs Indirect costs None of these choices are correct.

__________ consist of selling and administrative costs. Direct costs Indirect costs Period costs None of these choices are correct.

Inventory that consists of the costs of the direct and indirect materials that have not yet entered the manufacturing process is known as work in process inventory. materials inventory. finished goods inventory. None of these choices are correct.

Inventory that consists of the direct materials, direct labor, and factory overhead costs for products that have entered the manufacturing process but are not yet completed is known as materials inventory. finished goods inventory. work in process inventory. None of these choices are correct.

The total cost of making products that are available for sale during the period is called cost of goods sold. inventory cost expense. cost of goods manufactured. None of these choices are correct.

Which of the following are ways managerial accounting provides information and reports for managers to use in operating the business? Managerial accounting provides the cost of manufacturing a product, which can be used to determine its selling price. Managerial accounting allows for comparing the costs of manufacturing products over time and can be used to monitor and control the cost of direct materials, direct labor, and factory overhead. Performance reports allow management to identify any large amounts of scrap materials or employee downtime. All of these choices are correct.

Managerial accounting provides performance reports to internal users. Which of the following is considered an advantage of performance reports? Performance reports allow management to identify any large amounts of scrap materials or employee downtime. A report could analyze the potential efficiencies and dollar savings of purchasing computerized equipment to speed up the production process. A report could analyze how many units need to be sold to cover operating costs and expenses and used to set monthly selling targets and bonuses for sales personnel. All of these choices are correct.

Which of the following is not one of the five phases in the management process? a. improving b. decision making c. planning d. analyzing

Managerial accounting information uses a. estimated data only. b. financial statements only. c. historical data only. d. historical and estimated data.

Which of the following is one of the five phases in the management process? a. reconciling b. decision making c. budgeting d. analyzing

Which of the following would be classified as a factory overhead cost by a baking company? a. depreciation of office equipment b. strawberries c. freight in d. depreciation of factory equipment

Which of the following would be classified as an indirect cost by a baking company? a. flour b. salaries of bakers c. frosting d. salaries of production supervisors

Which of the following positions would have salaries or wages that are classified as a direct labor cost by a baking company? a. factory supervisor b. salesman c. president of the company d. baker

Margot's Deli Company has the following information for July. Cost of materials placed in production $30,000 Direct labor 25,000 Factory overhead 14,000 Work in process inventory, July 1 2,900 Work in process inventory, July 31 3,500 What is the cost of goods manufactured? a. $71,900 b. $68,400 c. $69,000 d. $75,400

Ralph's Cafe Company has the following information for June. Cost of materials placed in production $45,000 Direct labor 20,000 Factory overhead 14,000 Work in process inventory, June 1 2,900 Work in process inventory, June 30 3,500 What is the costs of goods manufactured? a. $81,900 b. $79,000 c. $78,400 d. $75,500

Ralph's Cafe Company has the following information for June. Cost of materials placed in production $45,000 Direct labor 20,000 Factory overhead 14,000 Work in process inventory, June 1 2,900 Work in process inventory, June 30 3,500 Finished goods inventory, June 1 $5,000 Finished goods inventory, June 30 $4,700 What is the cost of goods sold? a. $78,700 b. $78,400 c. $79,000 d. $83,400

Which of the following would probably not be determined using managerial accounting reports? a. the amount of employee downtime b. earnings per share c. the efficiency of purchasing new equipment to speed up the production process d. the manufacturing cost of each item produced

A company will use managerial reports to a. reduce direct labor costs. b. All of these choices are correct. c. determine spoilage. d. determine product selling prices.

A company will use managerial reports to a. determine actual product costs. b. All of these choices are correct. c. estimate product costs. d. consider computerized manufacturing processes.

The cost of materials used in production is determined using all of the following except a. materials inventory b. All of these choices are correct. c. materials purchased. d. direct labor