Accounting 211 Final Samuel Bass

Which of the following budgets allows for adjustments in activity levels

Flexible budget

the point where the sales line and the total costs line intersect on the cost-volume profit chart represents the

Break-even point

A series of equal cash flows at fixed intervals is termed a(n)

annuity

Which of the following is most associated with financial accounting reports

prepared in accordance with GAAP

Test 5

prevention cost=104,000

which of the following is an example of value-added time?

processing time

Which of the following are the three common types of responsibility centers?

cost, profit, investment

The systematic examination of the relationship among selling prices, volume of sales and production, costs, and profits is termed

cost-value profit

Which of the following statements is true of operating leverage

it is used to measure the impact of changes in sales on operating income.

A widely used activity base for developing factory overhead rates in highly automated settings is

machine hours

Accountants prefer the variable costing method over the absorption costing method for evaluating the performance of a company because

By using the absorption costing method, income could appear to be higher by producing more inventory.

the cost of a manufactured product generally consists of which of the following costs?

DL, DM, FOH

the amount of increase or decrease in cost that is expected from a particular course of action as compared with an alternative is

Differential cost

Which of the following are actual factory overhead allocation methods?

Single plantwide rate, multiple production department rates, and activity-based costing methods

Which of the following statements best describes the relationship among the costs of quality?

Spending more on prevention and appraisal costs will reduce the total overall costs of quality.

Standard costs are divided into which of the following components?

Standard price and standard quantity

Which of the following would most likely use job order costing?

Swimming pool installer

managers use managerial accounting information for which of the following purposes?

all of these choices.

Which of the following are two methods of analyzing capital investment proposals that both ignore present value?

average rate of return and cash payback

a point in the manufacturing process where the demand for the company's product exceeds the ability to produce the product is called

both a production bottle neck and a constraint

Which of the following is a plan that shows the expected cash receipts (inflows) and payments (outflows) during the budget period, including receipts from loans needed to maintain a minimum cash balance and repayments such of such loans?

cash budget

The amount of income under absorption costing will be more than the amount of income under variable costing when units manufactured

exceed units sold

Forde Co. has an operating leverage of 4. Sales are expected to increase by 12% next year. Operating income is

expected to increase 48%

Which of the following is a disadvantage of the average rate of return method?

fails to consider the time value of money

A plant manager's salary is a(n)

indirect cost

Which of the following would be classified as a variable cost for a T-shirt manufacturer

ink used for screen printing

Period cost include

operating costs that are shown on the income statement in the period in which they are incurred

Managerial accounting reports are

prepared according to management needs

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

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

in job order costing, when goods that have been ordered are received, the receiving department personnel count the goods, inspect the goods, and complete a

receiving report

most operating decisions of management focus on narrow range of activity called the ________ of production

relevant range

The relative distribution of sales among the various products sold by a business is the

sales mix

A cost that has been incurred in the past, cannot be recouped, and is irrelevant to future decisions is termed a

sunk cost

Contribution margin is

the excess of sales revenue over variable cost

In job order costing, on which of the following would labor costs be initially recorded?

time tickets

The present value index is computed using which of the following formulas?

total present value of Net cash Flows/ amount to be invested

A disadvantage of static budget is that they

do not allow for possible changes in activity levels.

Which of the following is an advantage of the cash payback method?

easy to use

The amount of income under absorption costing will equal the amount of income under variable costing when units manufactured

equal units sold

which of the following terms is used to describe the process by which managers monitor operations and compare actual expected results?

evaluation

Variances from standard costs are included in reports to?

management

which of the following is an advantage of decentralized operations?

managers closest to operations make decisions

Which of the following is an integrated set of operating and financial budgets for a period of time?

master budget

the source document for the data for debiting work in process for direct materials is a

materials requisition

Which of the following are commonly used approaches to setting transfer prices?

negotiated, price, market

Which of the following are present value methods of analyzing capital investment proposals?

net present value and internal rate of return

Which of the following terms is commonly used to describe the concept whereby the cost of manufactured products is composed of direct materials cost, direct labor cost, and variable factory overhead cost?

variable costing

Which of the following budgets is directly associated with the production budget?

All these choices

If a business had sales of $4,000,000 and a margin of safety of 25%, the break-even point was

$3,000,000

value added costs

177,000

if sales are $400,000, variable costs are 80% of sales, and operating income is $40,000, the operating leverage is

2.0

external failure costs

31,000

internal failure costs

33,000

non- value added costs

64,000

Which of the following terms is commonly used to describe the concept whereby the cost of manufactured products is composed of direct materials cost, direct labor cost, and all factory overhead costs

Absorption costing

In which of the following is operating income impacted by changes in inventory level?

Absorption costing only

Standard costs are used in companies for a variety of reasons. Which of the following is a benefit of using standard costs?

All of these choices

test 5

activity cost=241,000

Actions that transform a traditional manufacturing environment to a lean environment include which of the following

all of these choices

Which of the following is reason for a direct materials quantity variance?

all of these choices

Which of the following is related to long lead times?

all of these choices

how are the objectives of lean manufacturing achieved?

all of these choices

Which of the following underlying problems may be hidden by high raw materials, work in process, and finished goods inventory levels?

all of these choices.

Which of the following managerial decisions relies on accurate product costing?

All of these.

Which of the following conditions normally would indicate that standard costs should be revised?

All these choices

on the income statement of a manufacturing company, which of the following replaces purchases in the "Cost of goods sold" section of a retail company?

Cost of goods manufactured

A favorable cost variance occurs when

standard costs are more than actual costs

Which of the following terms is used to describe the process of developing the organization's long-term objectives?

strategic planning

Which of the following statements is true of the profit-volume chart?

The profit line intersects the horizontal zero operating profit line at the break-even point

Standard direct materials costs are determined by multiplying the standard price by the standard quantity

True

In order to be a useful managers, managerial accounting reports should posses which of the following characteristics

all these choice

Principal components of master budget include

all these choices

Understanding how costs behave is useful to management for

all these choices

appraisal costs=

appraisal costs=73,000

accounting for lean operations requires fewer transactions because

combined materials and conversion costs are transferred to finished goods

Businesses that are separated into two or more manageable units in which mangers have authority and responsibility for operations are said to be

decentralized

The lean philosophy attempts to reduce setup times, which will

decrease within-batch wait time

as production increases, the fixed cost per unit

decreases

the amount of increase or decrease in revenue that is expected from a particular course of action as compared with an alternative is

differential revenue

Which of the following would most likely use process costing?

Lawn fertilizer manufacturer

Standards that represent levels of operation that can be attained with reasonable effort are called_________ standards

Normal

Estimated cash receipts include planned increases in cash from which of the following?

Notes and accounts receivable collections

Which of the following is an example of a mixed cost?

Rental costs of $10,000 per month plus $0.30 per machine hour of use

A company sells goods for ($150,000) that cost ($54,000) to manufacture. Which of the following statements is true?

The company will decrease finished goods by ($54,000)