acct. 2 final
In order to be useful to managers, management accounting reports should possess all of the following characteristics EXCEPT: provide objective measures of past operations and subjective estimates about future decisions be prepared in accordance with generally accepted accounting principles be provided at any time management needs information be prepared to report information for any unit of the business to support decision making
b
Managerial accounting is prepared according to GAAP. is prepared according to management needs. is prepared periodically only. is related to the entire business entity only.
b
Scooby Company has applied $567,988 of overhead into production on Jobs in the Work in Process account. Actual overhead at the end of the year is $575,000. What is the adjustment for over or underapplied overhead? $7012 Overapplied, increase Cost of Goods Sold $7012 Underapplied, increase Cost of Goods Sold $7012 Overapplied, decrease Cost of Goods Sold $7012 Underapplied, decrease Cost of Goods Sold
b
The contribution margin ratio is the same as profit the same as the profit-volume ratio the portion of equity contributed by the stockholders the same as the variable cost ratio
b
The systematic examination of the relationships among selling prices, volume of sales and production, costs, and profits is termed contribution margin analysis cost-volume-profit analysis gross profit analysis budgetary analysis
b
The three most common cost behavior classifications are variable costs, product costs, and sunk costs fixed costs, variable costs, and mixed costs variable costs, sunk costs, and opportunity costs variable costs, period costs, and differential costs
b
Which of the following are the two main types of cost accounting systems for manufacturing operations? Process cost and general accounting systems Job order cost and process cost systems Job order and general accounting systems Process cost and replacement cost systems
b
Which of the following costs is an example of a cost that remains the same in total as the number of units produced changes? direct labor salary of a factory supervisor direct materials units-of-production depreciation on factory equipment
b
Which of the following costs is an example of a cost that remains the same in total as the number of units produced changes? direct materials salary of a factory supervisor units-of-production depreciation on factory equipment direct labor
b
Which of the following is an example of direct labor cost for an airplane manufacturer? Cost of oil lubricants for factory machinery Cost of wages of assembly worker Salary of plant supervisor Cost of jet engines
b
If the fixed costs are $500,000, the unit selling price is $55, and the unit variable costs are $30, what is the break-even sales (units) if the fixed costs are increased by $80,000? 25,000 units 19,333 units 23,200 units 10,545 units
c
In cost-volume-profit analysis, all costs are classified into the following two categories: discretionary costs and sunk costs sunk costs and fixed costs variable costs and fixed costs mixed costs and variable costs
c
Select the proper journal entry to record the movement of 1,450 units of part number 116B to work in process when each unit of 116B has a value of $2.00. Jan 15 Raw Material Inventory 2,900Work in Process 2,900 Jan 15 Work in Process 2,900Factory Overhead 2,900 Jan 15 Work in Process 2,900Raw Material Inventory 2,900 Jan 15 Work in Process 2,900 Cash 2,900
c
The cost of a manufactured product generally consists of which of the following costs? Direct materials cost and factory overhead cost Direct labor cost and factory overhead cost Direct labor cost, direct materials cost, and factory overhead cost Direct materials cost and direct labor cost
c
The difference between the current sales revenue and the sales at the break-even point is called the operating leverage contribution margin margin of safety price factor
c
The relative distribution of sales among the various products sold by a business is the product portfolio business's basket of goods sales mix contribution margin mix
c
Understanding how costs behave is useful to management for all the following reasons except predicting profits as sales and production volumes change estimating costs predicting customer demand changing an existing product production
c
What term is used to refer to the cost of changing direct materials into a finished manufactured product? Factory overhead cost Period cost Conversion cost Direct labor cost
c
Which of the following activity bases would be the most appropriate for gasoline costs of a delivery service? number of packages picked up number of truck drivers total of miles driven how many trucks are in service
c
Which types of inventories does a manufacturing business report on the balance sheet? Finished goods inventory, Cost of Goods Sold, and work in process inventory Net Income, Direct materials inventory and work in process inventory Direct materials inventory, work in process inventory, and finished goods inventory Overallocated, Direct materials inventory and finished goods inventory
c
Compute conversion costs given the following data: Direct Materials, $452,700; Direct Labor, $186,300; Factory Overhead, $175,600; and Selling Expenses, $45,290. $639,000 $175,600 $816,600 $361,900
d
In cost-volume-profit analysis, all costs are classified into the following two categories: sunk costs and fixed costs mixed costs and variable costs discretionary costs and sunk costs variable costs and fixed costs
d
An example of a period cost is: advertising expense indirect materials depreciation on factory equipment property taxes on plant facilities
a
The recording of the application of factory overhead costs to jobs would include a credit to: Factory Overhead Wages Payable Work in Process Cost of Goods Sold
a
The relative distribution of sales among the various products sold by a business is the sales mix product portfolio contribution margin mix business's basket of goods
a
When factory overhead costs exceed amount applied, the factory overhead account will have a debit balance and be underapplied a credit balance and be underapplied a credit balance and be overapplied a debit balance and be overapplied
a
Which of the following is the correct formula to calculate the predetermined factory overhead rate? Estimated total factory overhead costs divided by estimated activity base. Actual total factory overhead costs divided by estimated activity base. Estimated total factory overhead costs divided by actual activity base. Actual total factory overhead costs divided by actual activity base.
a
With the aid of computer software, managers can vary assumptions regarding selling prices, costs, and volume, and can immediately see the effects of each change on the break-even point and profit. This is called "what if" or sensitivity analysis vary the data analysis computer aided analysis data gathering
a
A cost that has characteristics of both a variable cost and a fixed cost is called a variable/fixed cost mixed cost sunk cost discretionary cost
b
For the manufacturing business, inventory which is in the process of being manufactured is referred to as: supplies inventory work in process inventory finished goods inventory direct materials inventory
b
If fixed costs are $1,200,000, the unit selling price is $240, and the unit variable costs are $110, what is the amount of sales required to realize an operating income of $200,000? 9,231 units 10,769 units 5,833 units 12,000 units
b
If fixed costs are $250,000, the unit selling price is $125, and the unit variable costs are $73, what is the break-even sales (units)? 3,425 units 4,808 units 2,000 units 2,381 units
b
If the fixed costs are $1,200,000, the unit selling price is $240, and the unit variable costs are $110, what is the amount of sales required to realize an operating income of $200,000? 5,833 units 10,769 units 12,000 units 9,231 units
b
If the fixed costs are $400,000 and the unit contribution margin is $20, what amount of units must be sold in order to have zero profit? 25,000 units 20,000 units 400,000 units 10,000 units
b
The proper journal entry to record the purchase of $25,000 of raw materials on account is: Jan 2 Raw Material Inventory 25,000Accounts Receivable 25,000 Jan 2 Raw Material Inventory 25,000Accounts Payable 25,000 Jan 2 Inventory 25,000Accounts Receivable 25,000 Jan 2 Inventory 25,000Cash 25,000
B
Materials must have which two qualities in order to be classified as direct materials? They must be classified as both prime costs and conversion costs. They must be introduced into the process in both work-in-process inventories and finished goods inventories. They must be an integral part of the finished product, but can be an insignificant portion of the total product cost. They must be an integral part of the finished product and be a significant portion of the total product cost.
d
The following budget data are available for Oldest Company: Estimated direct labor hours12,000Estimated direct dollars $90,000Estimated factory overhead costs$179,000 If factory overhead is to be applied based on direct labor hours, the predetermined overhead rate is $2.57 $.51 $.067 $14.92
d
What ratio indicates the percentage of each sales dollar that is available to cover fixed costs and to provide a profit? margin of safety ratio costs and expenses ratio profit ratio contribution margin ratio
d
What ratio indicates the percentage of each sales dollar that is available to cover fixed costs and to provide a profit? profit ratio margin of safety ratio costs and expenses ratio contribution margin ratio
d
Williams Company reports production costs for 2012 as follows: Direct materials used$375,000Direct labor incurred 250,000Factory overhead incurred 400,000Operating expenses 145,000 Williams Company's period costs for 2012 amount to: $375,000 $250,000 $400,000 $145,000
d
