Chapter 15 ACCT 2102
Which of the following is part of factory overhead cost? a.sales commissions b.depreciation of sales-person's vehicle c.direct materials used d.depreciation of factory equipment and machines
D
Identify the following costs as a prime cost (P), conversion cost (C), or both (B) for a magazine publisher: a. paper used int he magazines
P
Classify each of the following costs as either a product cost or a period cost: a. Chief financial officer's salary
Period cost
Classify each of the following costs as either a product cost or a period cost: b. Sales commissions
Period cost
Classify each of the following costs as either a product cost or a period cost: f. Utility costs for office building
Period cost
Classify each of the following costs as either a product cost or a period cost: d. Depreciation on sewing machines
Product cost
Period costs are...
selling and administrative expenses
Accounting designed to meet the needs of decision-makers inside the business is a.financial accounting b.external accounting c.managerial accounting d.general accounting
C
Which of the following is a period cost? a.factory overhead b.direct materials c.direct labor d.sales salaries expense
D
Identify the following costs as direct materials, direct labor, or factory overhead for a magazine publisher: b. Wages of printing machine employees
Direct Labor
Classify each of the following costs as either a product cost or a period cost: j. Advertising expenses
Period cost
Classify each of the following costs as either a product cost or a period cost: c. Property taxes on factory building and equipment
Product cost
Classify each of the following costs as either a product cost or a period cost: e. Fabric used during production
Product cost
Classify each of the following costs as either a product cost or a period cost: q. Wages of sewing machine operators
Product cost
Long-term plans are called...
strategic plans
Identify the following costs as a prime cost (P), conversion cost (C), or both (B) for a magazine publisher: c. maintenance on printing machines
C
Identify the following costs as a prime cost (P), conversion cost (C), or both (B) for a magazine publisher: d. glue used to bind the magazines
C
The primary goal of managerial accounting is to provide information to a.investors b.external auditors c.managers d.creditors
C
Which of the following individuals are charged with the responsibility of directing the day-to-day operations of a business? a.investors b.shareholders c.managers d.customers
C
Which of the following is a prime cost? a.insurance on factory equipment b.property tax on factory building c.wood used in furniture production d.salaries of production supervisors
C
Which of the following is an example of a factory overhead cost? a.president's salary b.insurance premiums on salespersons' automobiles c.factory heating and lighting cost d.repair and maintenance cost on the administrative building Feedback Area
C
Classify each of the following costs as either a product cost or a period cost: i. Oil used to lubricate sewing machines
Product cost
a cost object is...
a responsibility center, product, or service to which cost is to be assigned.
Indicate whether each of the following costs of a motorcycle manufacturer would be classified as direct materials cost, direct labor cost, or factory overhead cost: d. Glass for windshield
direct materials cost
The management process by which management monitors operations by comparing actual and expected results is...
evaluation
Factory overhead costs are manufacturing cost that are...
neither direct materials nor direct labor
indirect costs are...
not directly related to the products or services of a project.
The process of developing short-term objectives and actions is often referred to as...
operational planning
Rent expense on a factory building would be treated as a a.direct materials cost b.period cost c.product cost d.none of these choices
C
Identify the following costs as direct materials, direct labor, or factory overhead for a magazine publisher: c. Maintenance on printing machines
Factory Overhead
Identify as strategic planning, evaluation, or control. a. Developing long-term objectives
Strategic Planning
Product costs are costs...
associated with the product
Factory overhead costs combined with direct labor costs are called...
conversion costs
A product, sales territory, department, or activity to which costs are traced is called a...
cost object
The implementation of automatic, robotic factory equipment normally *blanks* the direct labor component of product costs.
decreases
Indicate whether each of the following costs of a motorcycle manufacturer would be classified as direct materials cost, direct labor cost, or factory overhead cost: i. Wages of assembly line workers
direct labor cost
Indicate whether each of the following costs of a motorcycle manufacturer would be classified as direct materials cost, direct labor cost, or factory overhead cost: a. Motorcycle engine
direct materials cost
The plant manager's salary would be considered...
indirect to the product
Identify the following costs as a product cost or a period cost for a magazine publisher: b. paper used in the magazines
product cost
Identify the following costs as a product cost or a period cost for a magazine publisher: d. maintenance on printing machines
product cost
The balance sheet of a manufacturer would include an account for...
work in process inventory
Insurance expenses incurred on a factory building would be treated as a a.period cost b.product cost c.selling cost d.direct cost
A
The cost of wages paid to employees directly involved in the manufacturing process in converting materials into finished products is classified as a.direct labor cost b.direct materials cost c.factory overhead cost d.miscellaneous costs
A
Which of the following is most associated with financial accounting reports? a.prepared in accordance with GAAP b.can be prepared periodically, or as needed c.can have both objective and subjective information d.can be prepared for the entity or segment
A
Which of the following is most associated with managerial accounting? a.may rely on estimates and forecasts b.always reports on the entire entity c.must follow GAAP d.is prepared for users outside the organization
A
Jensen Company reports the following: Line Item DescriptionAmountDirect materials used$345,000Direct labor incurred250,000Factory overhead incurred400,000Operating expenses175,000 Jensen Company's period costs are a.$345,000 b.$175,000 c.$250,000 d.$400,000
B
Which of the following terms refers to the cost of changing direct materials into a finished manufactured product? a.direct labor cost b.conversion cost c.period cost d.factory overhead cost
B
he cost of wages paid to employees directly involved in the manufacturing process in converting materials into finished products is classified as a.factory overhead cost b.direct labor cost c.direct materials cost d.miscellaneous costs Feedback Area
B
Conversion costs are a.direct materials and indirect labor b.direct materials and direct labor c.factory overhead and direct labor d.direct materials and factory overhead
C
Product costs a.appear only on the balance sheet b.are expensed as costs are incurred for direct labor, direct materials, and factory overhead c.appear on both the income statement and balance sheet d.appear only on the income statement
C
The cost of a manufactured product generally consists of which of the following costs? a.direct labor cost and factory overhead cost only b.direct materials cost and factory overhead cost only c.direct labor cost, direct materials cost, and factory overhead cost d.direct materials cost and direct labor cost only
C
Which of the following is an example of direct labor? a.plant managers b.janitorial personnel c.machine operators d.maintenance personnel
C
Identify as strategic planning, evaluation, or control. c. Process by which managers monitor operations by comparing actual and expected results
Evaluation
A sacrifice made to obtain some benefit is a(n)...
cost
Indicate whether each of the following costs of a motorcycle manufacturer would be classified as direct materials cost, direct labor cost, or factory overhead cost: c. Brake pads
direct materials cost
Identify the following costs as a product cost or a period cost for a magazine publisher: a. sales salaries
period cost
Identify the following costs as a product cost or a period cost for a magazine publisher: c. depreciation expense - corporate headquarters
period cost
Advertising costs are usually viewed as...
period costs
A partial list of the costs for Wisconsin and Minnesota Railroad, a short hauler of freight, follows. Classify each cost as either indirect or direct. For purposes of classifying each cost, use the train as the cost object. e. Diesel fuel costs
Direct
A partial list of the costs for Wisconsin and Minnesota Railroad, a short hauler of freight, follows. Classify each cost as either indirect or direct. For purposes of classifying each cost, use the train as the cost object. g. Insurance costs
Indirect
Which of the following is a conversion cost? a.plant janitor's wages b.machine operator wages c.direct labor wages d.assembly line wages
A
Which of the following accounts will be found on the income statement? a.Work in Process b.Cost of Goods Sold c.Inventory d.Finished Goods
B
Which of the following are basic functions of the management process? a.supervising and directing b.strategic planning and control c.decision making and supervising d.organizing and directing
B
Which of the following must be true in order for materials to be classified as direct materials? a.They must be introduced into the process in both work-in-process inventories and finished goods inventories. b.They must be an integral part of the finished product and a significant portion of the total product cost. c.They must be an integral part of the finished product but can be an insignificant portion of the total product cost. d.They must be classified as both prime costs and conversion costs. Feedback Area
B
Which of the following terms is used to describe the process of developing the organization's long-term objectives? a.measurement b.strategic planning c.evaluation d.control
B
A partial list of the costs for Wisconsin and Minnesota Railroad, a short hauler of freight, follows. Classify each cost as either indirect or direct. For purposes of classifying each cost, use the train as the cost object. a. Costs of accident cleanup
Indirect
A partial list of the costs for Wisconsin and Minnesota Railroad, a short hauler of freight, follows. Classify each cost as either indirect or direct. For purposes of classifying each cost, use the train as the cost object. c. Cost of track and bed (ballast) replacement
Indirect
A partial list of the costs for Wisconsin and Minnesota Railroad, a short hauler of freight, follows. Classify each cost as either indirect or direct. For purposes of classifying each cost, use the train as the cost object. d. Depreciation of terminal facilities
Indirect
A partial list of the costs for Wisconsin and Minnesota Railroad, a short hauler of freight, follows. Classify each cost as either indirect or direct. For purposes of classifying each cost, use the train as the cost object. f. Information technology support staff salaries
Indirect
A partial list of the costs for Wisconsin and Minnesota Railroad, a short hauler of freight, follows. Classify each cost as either indirect or direct. For purposes of classifying each cost, use the train as the cost object. h. Maintenance costs of right of way, bridges, and buildings
Indirect
A partial list of the costs for Wisconsin and Minnesota Railroad, a short hauler of freight, follows. Classify each cost as either indirect or direct. For purposes of classifying each cost, use the train as the cost object. i. Safety training costs
Indirect
A partial list of the costs for Wisconsin and Minnesota Railroad, a short hauler of freight, follows. Classify each cost as either indirect or direct. For purposes of classifying each cost, use the train as the cost object. j. Salaries of dispatching and communications personnel
Indirect
A partial list of the costs for Wisconsin and Minnesota Railroad, a short hauler of freight, follows. Classify each cost as either indirect or direct. For purposes of classifying each cost, use the train as the cost object. k. Wages of switch and classification yard personnel
Indirect
Classify each of the following costs as either a product cost or a period cost: l. Repairs and maintenance costs for sewing machines
Product cost
Classify each of the following costs as either a product cost or a period cost: m. Salaries of production quality control supervisors
Product cost
Classify each of the following costs as either a product cost or a period cost: p. Factory janitorial supplies
Product cost
Examples of factory overhead
Production supervisor salaries Quality assurance salaries Materials management salaries Factory rent Factory utilities Factory building insurance Fringe benefits Depreciation Equipment setup costs Equipment maintenance Factory supplies Factory small tools charged to expense Insurance on production facilities and equipment Property taxes on production facilities
Indicate whether each of the following costs of a motorcycle manufacturer would be classified as direct materials cost, direct labor cost, or factory overhead cost: e. Tires
direct materials cost
Indicate whether each of the following costs of a motorcycle manufacturer would be classified as direct materials cost, direct labor cost, or factory overhead cost: g. Motorcycle seat
direct materials cost
Indicate whether each of the following costs of a motorcycle manufacturer would be classified as direct materials cost, direct labor cost, or factory overhead cost: b. Depreciation of robotic assembly line equipment
factory overhead cost
Indicate whether each of the following costs of a motorcycle manufacturer would be classified as direct materials cost, direct labor cost, or factory overhead cost: f. Salary of quality control inspector
factory overhead cost
Indicate whether each of the following costs of a motorcycle manufacturer would be classified as direct materials cost, direct labor cost, or factory overhead cost: h. Safety helmets and masks for assembly line workers
factory overhead cost
Direct materials costs combined with direct labor costs are called...
prime costs
The salaries of factory supervisors are normally considered a...
product cost
Raw materials costs are usually viewed as...
product costs
Which of the following costs are conversion costs? a.direct labor cost and factory overhead cost b.direct materials cost and direct labor cost c.direct materials cost and factory overhead cost d.factory overhead cost Feedback Area
A
A plant manager's salary is a(n) a.direct cost b.indirect cost c.direct cost and an indirect cost d.period cost Feedback Area
B
Conversion costs are a.direct materials and direct labor b.factory overhead and direct labor c.direct materials and indirect labor d.direct materials and factory overhead
B
Identify the following costs as a prime cost (P), conversion cost (C), or both (B) for a magazine publisher: b. wages of printing machines employees
B
Rent expense on a factory building would be treated as a a.period cost b.product cost c.direct materials cost d.none of these choices
B
The cost of a manufactured product generally consists of which of the following costs? a.direct materials cost and direct labor cost only b.direct labor cost, direct materials cost, and factory overhead cost c.direct materials cost and factory overhead cost only d.direct labor cost and factory overhead cost only
B
Identify as strategic planning, evaluation, or control. b. The process by which management takes actions to encourage specific behaviors or outcomes
Control
Direct costs are...
Costs directly connected to the development and production of a specific product
Costs other than direct materials cost and direct labor cost incurred in the manufacturing process are classified as a.product costs b.miscellaneous expense c.period cost d.factory overhead cost
D
In order to be useful to managers, managerial accounting reports should possess which of the following characteristics? a.be prepared to report information for any unit of the business to support decision making b.provide objective measures of past operations and subjective estimates about future decisions c.be provided at any time management needs information d.all of these choices
D
Managers use managerial accounting information for which of the following purposes? a.to support strategic planning decisions b.to analyze the performance of a company's operations c.to determine the cost of manufacturing a product d.all of these choices
D
Identify the following costs as direct materials, direct labor, or factory overhead for a magazine publisher: d. Glue used to bind the magazines
Factory Overhead
Classify each of the following costs as either a product cost or a period cost: h. Depreciation on office equipment
Period cost
Classify each of the following costs as either a product cost or a period cost: k. Research and development costs
Period cost
Classify each of the following costs as either a product cost or a period cost: n. Salaries of distribution center personnel
Period cost
Classify each of the following costs as either a product cost or a period cost: o. Travel costs of media relations employees
Period cost
Classify each of the following costs as either a product cost or a period cost: g. Factory supervisors' salaries
Product cost
Which of the following is a characteristic of useful managerial accounting reports? a.historical and estimated data b.prepared as needed c.accurate d.all of these choices
D
Which of the following is an example of direct materials cost for an automobile manufacturer? a.salary of production supervisor b.cost of assembly worker wages c.cost of oil lubricants for factory machinery d.cost of interior upholstery
D
Which of the following terms is used to describe the process of developing the organization's long-term objectives? a.measurement b.evaluation c.control d.strategic planning
D
Which of the following would be least likely to be considered a managerial accounting report? a.report to analyze potential efficiencies and savings for the purchase of new production equipment b.statement of cost of goods manufactured c.schedule of total manufacturing costs incurred d.statement of stockholders' equity
D
A partial list of the costs for Wisconsin and Minnesota Railroad, a short hauler of freight, follows. Classify each cost as either indirect or direct. For purposes of classifying each cost, use the train as the cost object. b. Cost to lease (rent) locomotives and railroad cars
Direct
A partial list of the costs for Wisconsin and Minnesota Railroad, a short hauler of freight, follows. Classify each cost as either indirect or direct. For purposes of classifying each cost, use the train as the cost object. l. Wages of train engineers
Direct
Identify the following costs as direct materials, direct labor, or factory overhead for a magazine publisher: a. Paper used in the magazines
Direct Materials
What are the items properly classified as part of? + Consultant fees for a study of production line efficiency + Depreciation on mechanical robots used on the assembly line + Machine lubricant used to maintain the assembly line at the Louisville, Kentucky, assembly plant + Plant manager's salary at Buffalo, New York, stamping plant, which manufactures auto and truck subassemblies
Factory Overhead