Accounting Final: MC

A company's ending inventory of finished goods has a total cost of $10,000 and consists of 500 units. If the OH applied to these goods is $4,000, and the predetermined OH rate os %80 of DL costs, how much DMC was incurred in producing these 500 units?

$1,000

A company earned net income of $1,000,000 this year. The avg number of outstanding shares during the year was 200,000 common shares and 100,000 preferred shares. A preferred cash dividend was declared for $100,000. Compute company's basic earnings per share (EPS).

$4.50

A company's predetermined oh rate is 150% of its direct labor costs. How much OH is applied to a job that requires total direct labor costs of $30,000?

$45,000

Ten Steps of the Accounting Cycle

1. Analyze business transactions 2. Journalize business transactions 3. Post to general ledger 4. Prepare unadjusted trial balance 5. Adjust and post accounts 6. Prepare adjusted trial balance 7. Prepare financial statements 8. Close accounts 9. Prepare post-closing trial balance 10. Reverse

A company uses DL costs to apply OH. Its production costs for the period are: DM = $45,000 DL = $35,000 OH Applied = $38,500 What is the predetermined OH rate?

110%

A company had net cash flows from operations of $341,000, net income of $286,000 and average total assets of $1,850,000. The cash flow on total assets ratio equals:

18.4%

Spears Co. had net sales of $35,400 M. Its avg total assets for the period were $14,700M. Spears' total asset turnover is?

2.41

A company had $7,000,000 in net income for the year. Its net sales were $15,200,000 for the same period. Calculate its profit margin.

46.1%

At the end of the current year, Leer company reported total liabilities of $300,000 and total equity of $100,000. The company's debt ratio on the last year-end was:

75.0%

A company had net sales of $600,000, total sales of $750,000, and an avg accounts receivable of $75,000. Its AR turnover is?

8.00

Speedy has net income of $18,955, and assets at the beginning of the year of $200,000. Assets at the end of the year total $246,000. Compute its return on assets.

8.5%

Cost pool

A group of costs that have the same activity driver

Standard cost card

A record that accumulates standard cost info

A cost accounting system is best defined as:

A set of procedures that record manufacturing costs

Activity

A task that causes cost to be incurred

Incurred but unpaid expenses that are recorded during the adjusting process with a debit to an expense and a credit to a liability are:

Accrued expenses

If management wants the most accurate product cost, which cost method should be used?

Activity-based costing

The adjusted trial balance contains info pertaining to:

All general ledger accounts

Cost object

Anything to which costs will be assigned

Which of the following accounting principles prescribes that a company record its expenses incurred to generate the revenue reported? A. Going concern assumption B. Expense recognition (matching) principle C. Measurement (cost) principle D. Business entity assumption

B. Expense recognition (matching) principle

Which of the following would usually NOT be used in computing plantwide OH rates? A. DL hours B. Number of quality inspections C. DL dollars D. Machine hrs

B. Number of quality inspectors

The conceptual framework of GAAP includes all all of the following broad areas to guide standard setting except: A. Objectives B. Qualitative methods C. Uniformity D. Elements

C. Uniformity

A listing of accounts with identification numbers assigned to each account is called a:

Chart of accounts

Controllable costs

Costs that a manager has the ability to affect.

Debit or Credit? Accounts payable

Credit

Debit or Credit? Common stock

Credit

Debit or Credit? Interest payable

Credit

Debit or Credit? Unearned revenue

Credit

Debit or Credit? Accounts receivable

Debit

Debit or Credit? Dividends

Debit

Debit or Credit? Equipment

Debit

Debit or Credit? Land

Debit

Debit or Credit? Note receivable

Debit

Debit or Credit? Prepaid insurance

Debit

Debit or Credit? Prepaid rent

Debit

Debit or Credit? Supplies inventory

Debit

Analyze impact: The company pays cash toward an account payable

Decreases an asset and decreases a liability

Analyze impact: The company paid cash dividends to shareholders

Decreases an asset and decreases equity

The 3 major cost components of manufacturing a product are ______________.

Direct materials, direct labor, and factory overhead

The broad principle that requires expenses to be reported in the same period as the related revenues that were earned as a result of expenses is the:

Expense recognition (matching) principle

Costs are incurred as part of the manufacturing process, but are not clearly traceable to the specific unit of product or batches of product, are called:

Factory OH costs

The rule that requires financial statements to reflect the assumption that the business will continue operating instead of being closed or sold, unless evidence shows that it will not continue, is the:

Going-concern principle

Analyze impact: The company workers earn wages this period but are not paid until next period

Increases a liability and decreases equity

Analyze impact: The company purchases supplies for cash

Increases an asset and decreases an asset

Analyze impact: The company purchases equipment on credit

Increases an asset and increases a liability

Analyze impact: The owner invests cash in the business in exchange for its common stock

Increases an asset and increases equity

The debt-to-equity ratio...

Is a means of assessing the risk of a company's financing structure.

The current ratio:

Is used to help assess a company's ability to pay its debts in the near future.

The record of all accounts and their balances used by a business is called a:

Ledger

Match the building blocks of financial statement analysis to the ratio is best relates: Accounts Receivable Turnover

Liquidity and efficiency

Match the building blocks of financial statement analysis to the ratio is best relates: Days' sales in inventory

Liquidity and efficiency

Match the building blocks of financial statement analysis to the ratio is best relates: Dividend yield

Market prospects

The accounting principle that requires accounting info to be based on actual cost and requires assets and services to be recorded initially at the cash or cash-equivalent amount given in exchange is the:

Measurement (cost) principle

Standard cost

Preset cost for delivering a product or service under normal conditions

A job is best defined as:

Production activities for a customized product

Job order production is best defined as:

Production of products in response to customer orders

Match the building blocks of financial statement analysis to the ratio is best relates: Return on total assets

Profitabiility

Match the building blocks of financial statement analysis to the ratio is best relates: Book value per common share

Profitability

Match the building blocks of financial statement analysis to the ratio is best relates: Gross margin ratio

Profitability

The primary objective of financial accounting is to:

Provide accounting info that serves external users

Practical standard

Qty of inout required under normie conditions

Ideal standard

Quantity of input required if a production process is 100% efficient.

Match the building blocks of financial statement analysis to the ratio is best relates: Debt Equity Ratio

Solvency

Match the building blocks of financial statement analysis to the ratio is best relates: Times Interest Earned

Solvency

A direct cost is one that is :

Traceable to the cost object

Indirect expenses

costs incurred for the joint benefit of more than one department

Uncontrollable costs

costs not within the manager's control or influence

Direct expenses

costs that can be readily traced to a department

Management by exception

managing by focusing on large differences from standard costs

Activity driver

measurement associated with an activity