accounting 200 midterm

Which of the following is the correct flow of manufacturing costs?

Raw materials, work in process, finished goods, cost of goods sold

Product costs

include the costs of purchasing or making/manufacturing a product. i.e., Direct materials, direct labor, and allocated manufacturing overhead (or allocated factory overhead or applied factory overhead)

Which of the following is an example of appraisal costs?

product testing cost

Generally, period costs are classified as either

selling expenses or administrative expenses.

In a production cost report, ________ includes the number of units completed and transferred out of a process and the number of units remaining in ending WIP. The weighted-average method is used.

total units accounted for

Cost of Materials Used $45,000 Direct Labor costs. $48,000 Factory Overhead $39,000 Work in Process, beg. $28,000 Work in Process, end. $18,000 What is Cost of Goods Manufactured?

$142,000

Gould Enterprises sells computer disks for $3.16 per disk. Unit variable cost is $0.06. The breakeven point in units is 3,600, and expected sales in units are 4,300. What is the margin of safety in dollars?

$2,212

The Assembly Department of ZigZag, Inc., manufacturer of computers, incurred $280,000 in direct material costs and $70,000 in conversion costs. The equivalent units of production for direct materials and conversion costs are 1,000 and 900, respectively. The cost per equivalent unit of production for direct materials is ________. (Round your answer to the nearest cent.)

$280.00

Costs that vary in total in direct proportion to changes in an activity level are called:

variable costs

Internal failure costs are costs incurred ________.

when the company corrects poor-quality goods or services before delivery to customers

Which of the following formulas is used to calculate the cost per equivalent unit of production (EUP) for direct materials? The weighted-average method is used.

Cost per EUP for direct materials = Total direct materials costs / Equivalent units of production for direct materials

Which of the following is considered a part of factory/manufacturing overhead cost?

Depreciation of factory buildings

Conversion Costs =

Direct Labor Costs + Manufacturing Overhead (or Factory Overhead)

Service Costs =

Direct Labor Costs + Overhead Costs

Prime Costs =

Direct Materials + Direct Labor Costs

Which of the following costs are referred to as conversion costs?

Direct labor cost and factory overhead cost

Operating Income =

Gross Profit - Operating Expenses

Operating Income =

Gross Profit - Operating Expenses such as (a) Selling Expenses and (b) General and Administrative Expenses

Manufacturing Overhead (or Factory Overhead) = indirect product costs associated with production =

Indirect Materials + Indirect Labor + Other Indirect Costs (or Factory Costs)

What is the primary criterion for the preparation of managerial accounting reports?

Meet the manager needs

Gross Profit

Net Sales - Service Costs

Which of the following is not associated with managerial accounting?

Prepared in accordance with GAAP

Total Costs =

Product Costs + Period Costs

Product Costs =

Variable Manufacturing Costs + Fixed Manufacturing Costs or total direct costs + total indirect costs

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

a soda manufacturer

Blue Ridge Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plant-wide factory overhead rate for allocating overhead to products. However, management is considering moving to a multiple department rate system for allocating overhead. The following table presents information about estimated overhead and direct labor hours. Painting Dept. Finishing Dept. Totals Overhead $248,000 72,000 $320,000 ======== Direct Labor Hours (dlh) 10,000 dlh 10,000 20,000 dlh ========== A 16 dlh 420 dlh ====== Product B 4 dlh 16 20 dlh ====== Determine the overhead from both production departments allocated to each unit of Product A if the company uses a multiple department rate system.

$425.60 per unit

Jetz, Inc. manufactures water bottles for children. Similar water bottles are available in the market for $8.00. Jetz desires a 24% net profit margin. Jetz's target cost is ________.

$6.08

Under process costing, the number of units to account for must always be ________ the number of units accounted for.

equal to

Which of the following is not a factory overhead allocation method?

factory costing

The Rocky Company reports the following data. Sales $800,000 Variable costs $300,000 Fixed costs $120,000 Rocky Company's operating leverage is:

1.3

The manufacturing cost of Prancer Industries for three months of the year are provided below: Total Cost. Production April. 60,700 1,200 Units May 80,920 1,800 Units June 100,300 2,400 Units

$33 per unit and $21,100 respectively.

Lakeside, Inc., using standard cost systems, estimated manufacturing overhead costs for the year at $371,000, based on 181,000 estimated direct labor hours. Actual direct labor hours for the year totaled 196,000. The manufacturing overhead account contains debit entries totaling $392,000. The Manufacturing Overhead for the year was ________. (Round any intermediate calculations to two decimal places, and your final answer to the nearest dollar.)

$9,800 overallocated

The Skagit Company manufactures Hooks and Nooks. The following shows the activities per product and total activity information: 3 Hooks - 4,000 units Nooks - 8,000 units Activity Pool Setups 12 Activity Base Inspections 32 Assembly (DLH) 13 Budgeted Amount $ 60,000 120,000 420,000 Setups 20,000 Inspections 24,000 Assembly (DLH) 28,000 13. Calculate the total factory overhead to be charged to Nooks.

. $488,000

Period costs

., (a) Selling expenses, and (b) general and administrative expenses, such as rent, office depreciation, office supplies and office utilities (Operating Expenses), and other Non-operating expenses such as income tax expense and interest expense

If fixed costs are $350,000, the unit selling price is $29, and the unit variable costs are $20, what is the break-even sales (units) if the variable costs are decreased by $4?

26,924 units

If sales are $425,000, variable costs are 62% of sales, and operating income is $50,000, what is the contribution margin ratio?

38%

The Refining Department of Ingber Sugar, Inc. had 56,000 tons of sugar to account for in December. Of the 56,000 tons, 40,000 tons were completed and transferred to the Boiling Department, and the remaining 16,000 tons were 60% complete. The materials required for production are added at the beginning of the process. Conversion costs are added equally throughout the refining process. Calculate the total equivalent units of production for conversion costs.

49,600 units

At the end of the year, Metro, Inc. has an unadjusted credit balance in the Manufacturing Overhead account of $820. Which of the following is the year-end adjusting entry needed to adjust the account?

A debit to Manufacturing Overhead of $820 and a credit to Cost of Goods Sold of $820

The cost of production of completed and finished goods during the period amounted to $450,000, and the finished products shipped to customers had total production costs of $357,000. From the following, select the entry to record the transfer of costs from work in process to finished goods.

Finished Goods 450,000 Work in Process 450,000

Which of the following statements is true regarding fixed and variable costs?

Fixed costs are constant in total, and variable costs are constant per unit.

Just-in-time costing systems use a combined account for Raw Materials Inventory and Work-in-Process Inventory known as the ________.

Raw and In-Process Inventory account

Which of the following triggers manufacturing under the just-in-time management system?

consumer demand

Nevada Manufacturing has two processing departments, Department I and Department II. The raw materials processed at Department I are sent to Department II for further processing. During June, direct materials worth $40,000 purchased on account were assigned to Department I. The journal entry to record the issue of direct materials to production is ________.

debit Work-in-Process Inventory—Department I, $40,000; credit Raw Materials Inventory, $40,000