Managerial Accounting Exam 1 (Chapters 1, 2, 3, and 5) – Flashcards
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Which of the following is not an objective of managerial accounting?
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To prepare external reports for investors, creditors, government agencies, and other outside users.
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Which of the following is an example of the management activity referred to as planning?
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Developing a strategy for disposing of hazardous waste
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Investigating production variances and adjusting the production process is an example of
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Controlling.
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The primary objective of managerial accounting is:
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To provide management with information useful for planning and control of operations.
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Managerial accounting
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Has no mandatory rules.
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Managerial accounting reports are prepared
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To meet the needs of decision makers within the firm.
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Financial accounting
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Has to adhere to GAAP policies, focuses on external users, and is concerned with the information about the firm as a whole.
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Which of the following would not be an example of a value-added activity?
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Storage of finished products
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The controller of an organization participates in
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Decision making, controlling, and planning
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The standards of ethical conduct for managerial accountants include
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Competence, confidentiality, integrity, and credibility.
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A fixed cost within the relevant range
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Does not change in total as output changes.
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Which of the following would be an example of a fixed cost?
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Depreciation on equipment
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Which of the following is an example of a discretionary fixed cost?
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Advertising costs
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A committed fixed cost
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Often involves a long-term contract.
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Variable costs within the relevant range
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Decrease in total as output decreases, stays constant on a per unit basis as output changes, and increase in total as output increases
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Which of the following would be a variable cost for a dentist's office?
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Cost of teeth cleaning material
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Total variable costs:
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Increases as output increases, decreases as output decreases, and equal a variable rate x amount of output
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A factor that causes or leads to a change in a cost or activity is a(n):
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Driver.
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Which of the following would probably be a variable cost at a college?
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Cost of registration forms
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Per-unit variable costs:
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Remain constant within the relevant range.
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Which of the following is an example of direct labor?
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Assembly line worker for televisions
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Overhead includes
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Indirect labor, indirect materials, and supplies
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Which of the following would be an example of a direct materials cost?
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Engine on an airplane
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Which of the following is not an example of a direct materials cost?
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Nail used to manufacture a desk
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An indirect cost
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Is hard to trace
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Non-manufacturing costs include
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Marketing and administration.
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Product costs
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Are costs that are included in the determining the value of the inventory, include direct materials, direct labor, and overhead, and are manufacturing costs
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Cost is:
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The amount of cash or cash equivalent sacrificed for goods and/or services that are expected to bring a current or future benefit to the organization.
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Product costs consist of
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Direct materials, direct labor, and overhead.
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Which of the following would not be a period cost?
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Direct materials
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Which of the following is not a characteristic of job-order costing?
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Unit cost is computed by dividing process costs of the period by the units produced in the period
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Firms in the ____ business are most likely to use a process-costing system.
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petroleum
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Which of the following is the assignment process used with normal costing?
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Actual direct material and direct labor costs are assigned to products, but overhead costs are assigned using predetermined rates.
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Morrow Company applies overhead based on direct labor hours. At the beginning of the year, Morrow estimates overhead to be $620,000, machine hours to be 180,000, and direct labor hours to be 40,000. During February, Morrow has 4,200 direct labor hours and 8,000 machine hours.
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$15.50 per direct labor hour
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At the beginning of the year, Kyla Inc. estimated that overhead would be $880,000 and direct labor hours would be 220,000. At the end of the year, actual overhead was $920,600 and there were actually 230,000 direct labor hours.
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$600 under-applied
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The unit cost of a job consists of the total costs of
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Labor worked on the job, materials used on the job, and applied overhead
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Manufacturing overhead
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Consists of all manufacturing costs other than direct materials and direct labor
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The document that lists the total cost for a single job is a
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Job-order cost sheet
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Which of the following is not on a time ticket?
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Cost of materials
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Which form asks for type, quantity, unit price of direct materials issued, and for the number of the job?
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Materials requisition form
