ACC 2020 EXAM

$180,936

At Hodgson​ Corporation, direct materials are added at the beginning of the process and conversions costs are uniformly applied. Other details​ include: 1. Beginning WIP direct materials $42,000 2. Beginning WIP conversion costs $28,250 3. Costs of materials added $391,100 4. Costs of conversion added $279,125 5. WIP beginning​ (50% for​ conversion) 19,200 units 6. Units started 129,500 units 7. Units completed and transferred out 106,700 units 8. WIP ending​ (60% for​ conversion) 42,000 units What is the total cost of units remaining in ending​ WIP?

$3,982

Calico Corporation produced 2,500 units in Job 903. The following data is provided for Job 903 for the​ year: 1. Direct materials used $3,200 2. Direct labor costs $782 3. Actual manufacturing overhead rate per direct labor hour $17.15 4. Predetermined manufacturing overhead rate per direct labor hour $19.20 5. Direct labor hours used in Job 903 34 6. Direct labor rate per hour $23 What is the total cost of Job​ 903?

Credibility

Communicating information fairly and objectively is an example of which ethical​ standard?

True

Controlling costs across the whole value chain often requires a trademinus−off between the individual elements of the value chain.

True

Cost distortion occurs when some products are overcosted while other products are undercosted by the cost allocation system.

Costs outweigh benefits by​ $3100.

Country Western Clothing Outfitters is considering investing in an inventory tracking system. It will have​ $10,500 in software costs and​ $8800 in employee training costs. Computer hardware also needs to be upgraded for the​ system; the hardware upgrades are expected to be​ $12,600. The expected benefits from the inventory tracking system should be​ $28,800. Do the benefits outweigh the costs or do the costs outweigh the​ benefits, and by how​ much?

False

A lean company typically strives to lengthen the manufacturing cycle time.

tires used in production of cars.

All of the following are considered fixed costs except

A.distribution. B.design. C.marketing. D.administration.

All of the following are part of a​ company's value chain except

ABC systems may only be used by service companies.

All of the following describe an ABC system except

True

Appraisal costs are incurred to detect poor−quality goods or services.

$135,100

At Hodgson​ Corporation, direct materials are added at the beginning of the process and conversions costs are uniformly applied. Other details​ include: 1. Beginning WIP direct materials $32,000 2. Beginning WIP conversion costs $20,250 3. Costs of materials added $384,100 4. Costs of conversion added $271,125 5. WIP beginning​ (50% for​ conversion) 26,200 units 6. Units started 124,500 units 7. Units completed and transferred out 111,700 units 8. WIP ending​ (60% for​ conversion) 39,000 units What are the total equivalent units for conversion​ costs?

$2.82

At Hodgson​ Corporation, direct materials are added at the beginning of the process and conversions costs are uniformly applied. Other details​ include: 1. Beginning WIP direct materials $37,000 2. Beginning WIP conversion costs $20,250 3. Costs of materials added $388,100 4. Costs of conversion added $271,125 5. WIP beginning​ (50% for​ conversion) 23,200 units 6. Units started 127,500 units 7. Units completed and transferred out 112,700 units 8. WIP ending​ (60% for​ conversion) 38,000 units What is the cost per equivalent unit for direct​ materials?

False

External failure costs occur when the company detects and corrects poor−quality goods or services before delivery to customers

True

For a manufacturing​ system, inventory flows from raw materials inventory to work in process inventory to finished goods inventory.

A. help make product mix decisions. B. get a more accurate price of products. C. cut costs. D. all of the above are correct.

Most companies adopt ABC in order to

True

One condition that favors using a departmental overhead​ rate, rather than plantwide overhead​ rates, is that different departments incur different amounts and types of manufacturing overhead.

Directing

Overseeing the dayminus−tominus−day operations of a company is an example of which of the following management​ functions?

$1350

Perfect Pigments has 2,700 gallons of paint in WIP​ Inventory, with 71​% of materials already added. The paint is 50​% through the process. Assuming all conversion costs are added evenly throughout the​ process, what are the equivalent units for conversion​ costs?

$240

Plowin' Supply plans to make 19,000 tractors at its plant. Fixed costs are $570,000 and variable costs are $210 per tractor. What is the average cost per​ tractor?

total est man overhead costs/ total est amt of teh allocation base.

Predetermined MOH Rate=

Raw Materials Inventory 90,000 Accounts Payable 90,000 (To record purchase of raw materials)

Purchase of Raw Materials Assume that Life Fitness ordered and received $90,000 of raw materials during December.

product−level

Research and development would most likely be classified as a​ ________ cost.

​$35,420

Squire Corporation charged Job 110 with​ $14,000 of direct materials and​ $12,600 of direct labor. Allocation for manufacturing overhead is​ 70% of direct labor costs. What is the total cost of Job​ 110?

$2720

Start the Day Right has 3,400 gallons of orange juice in WIP​ Inventory, with 80​% of materials already added. What are equivalent units in ending WIP Inventory for materials if the orange juice is 5959​% through the​ process?

DOWNTIME defects, overproduction, waiting, not using people, transportation, inventory, movement, excess processing.

The Eight Wastes of Traditional Operations

Design

The costs associated with reengineering machinery and its location within the factory to increase efficiency would be considered which element of the value​ chain?

True

The end goal of process costing and job costing at a manufacturing company is the​ same: to find the cost of producing one unit of product.

identify the primary activities and estimate a total cost pool for each.

The first step in developing an ABC system is

True

The main driver of indirect costs for service firms is usually labor hours.

Planning

The management accountant at Technology Innovators determined​ $500,000 is the​ organization's earning goal to accommodate the organizational plan during the first quarter during a new year. The accountant realizes that to achieve the new earning​ goal, the operations manager needs to increase the price of technology parts charged to a consumer to​ $250.00 per unit. The manager is scheduling a new staff meeting to determine if they need to increase the marketing efforts at the​ firm, or if they need to design a new part that uses materials that are less expensive to produce.

True

The overhead allocation base should be the cost driver of manufacturing overhead costs.

False

The total cost of a cost object can only include the direct costs that are directly traced to that cost object.

False

There will be little benefit to using an activityminus−based costing system when products are vastly different from each other and consume different amounts of resources.

​Profit, people, planet

The​ "triple bottom​ line" focuses on what three factors that influence a​ firm's ability to survive and thrive in the long​ run?

follow their​ company's established policies for reporting unethical behavior.

To resolve ethical​ dilemmas, the IMA suggests that management accountants should first

Department Overhead Rate

Total alloc department overhead cost / Cost est amt of depart allocation base (estimated)

True

Two main benefits of ABC are​ (1) more accurate product cost information and​ (2) more detailed information on the costs of activities and the drivers of those costs.

Work in Process Inventory 112,000 Raw Materials Inventory 112,000 (To record the use of direct materials on jobs)

Use of Direct Materials Assume that Life Fitness used $112,000 of direct raw materials during December.

Manufacturing Overhead 2,000 Raw Materials Inventory 2,000 (To record the use of indirect materials in the factory)

Use of Indirect Materials Assume that Life Fitness used $2,000 of indirect raw materials during December.

(allocate can't trace directly in)

We can trace our direct material and direct labor cost to the job

Confidentiality

What ethical standard is being violated when you tell a friend that the company you work for is going to report lower than expected earnings next​ week?

Controlling

When management uses feedback to take corrective action on the​ budgets, which of the following management responsibilities are being​ fulfilled?

CMA

Which of the following certifications is issued by the​ IMA?

Warranty claims

Which of the following is an example of a cost item that should be classified as an external failure​ cost?

Pepsi

Which of the following is an example of an industry that would use a process costing—rather than a job costing—​system?

Wages of a machine operator

Which of the following is an example of direct​ labor?

Wages of factory maintenance personnel

Which of the following is an example of manufacturing overhead expense in a​ factory?

Determining the balance in raw materials inventory

Which of the following is not a way in which management can use job cost​ information?

Cost of the automobile engines

Which of the following is not an example of an indirect cost incurred in manufacturing​ automobiles?

Customer orders drive the production process.

Which of the following is true about lean​ thinking?

Current shareholders

Which of the following persons or groups would be least likely to receive detailed managerial accounting​ reports?

Financial accounting provides sufficient information for managers to effectively plan and control operations.

Which of the following statements is false about financial​ accounting?

Managerial accounting information emphasizes relevance.

Which of the following statements is true regarding managerial accounting​ information?

A. Storing inventory is very expensive. B. Inventory could​ spoil, get broken or​ stolen, or become obsolete. C. It ties up cash that could be used for​ other, more useful purposes. D. All of the above are reasons large amounts of inventory are considered wasteful.

Why are large amounts of inventory considered​ wasteful?

True

With increased​ competition, managers need more accurate estimates of product costs in order to set prices and to identify the most profitable products.

Overallocation

actual MOH < allocated MOH

Underallocation

actual MOH > allocated MOH

enterprise resource planning (ERP)

Integrate all of a company's worldwide functions, departments, and data

batchminus−level

Machine set−up would most likely be classified as a​ ________ cost.

A.analyzing data. B.communicating results. C.providing decision support. D.All of the above.

Managerial accountants may be responsible for

$148,700

At Hodgson​ Corporation, direct materials are added at the beginning of the process and conversions costs are uniformly applied. Other details​ include: 1. WIP beginning​ (50% for​ conversion) 19,200 units 2. Units started 129,500 units 3. Units completed and transferred out 115,700 units 4. WIP ending​ (60% for​ conversion) 33,000 units 5. Beginning WIP direct materials ​$32,000 6. Beginning WIP conversion costs $20,250 7. Costs of materials added $384,100 8. Costs of conversion added $271,125 What are the total equivalent units for direct​ materials?

$544,355

At Hodgson​ Corporation, direct materials are added at the beginning of the process and conversions costs are uniformly applied. Other details​ include: Beginning WIP direct materials $ 37 comma 000$37,000 Beginning WIP conversion costs $ 24 comma 250$24,250 Costs of materials added $ 389 comma 100$389,100 Costs of conversion added $ 279 comma 125$279,125 WIP beginning​ (50% for​ conversion) 27 comma 20027,200 units Units started 122 comma 500122,500 units Units completed and transferred out 105 comma 700105,700 units WIP ending​ (60% for​ conversion) 44 comma 00044,000 units What is the total cost of units completed and transferred​ out?

$3.27

At Hodgson​ Corporation, direct materials are added at the beginning of the process and conversions costs are uniformly applied. Other details​ include: Beginning WIP direct materials ​$32,000 Beginning WIP conversion costs $ 40 comma 000$40,000 Costs of materials added ​$384,100 Costs of conversion added $ 389 comma 100$389,100 WIP beginning​ (50% for​ conversion) 24 comma 20024,200 units Units started 122 comma 500122,500 units Units completed and transferred out 107 comma 700107,700 units WIP ending​ (60% for​ conversion) 39 comma 00039,000 units What is the cost per equivalent unit for conversion​ costs?

job cost record

A​ ________ is used to accumulate the costs of a job.

$224,000.

Harper Inc. has fixed costs of $780,000 when it produces 350,000 units. Its total variable costs are $140,000. When Harper Inc. produces 560,000 ​units, its total variable costs will be

They increase as production decreases.

How do fixed costs per unit​ behave?

They remain the same throughout production levels within the relevant range.

How do variable costs per unit​ behave?

increase.

If a company were to decrease its prevention costs by eliminating employee​ training, the​ company's external failure costs would most likely

decrease

If a company were to increase its appraisal costs by inspecting more units as the units are​ completed, the​ company's external failure costs would most likely

​1. indirect 2. direct 3. indirect

If the Ford Focus is the cost​ object, classify each of the following costs as indirect or​ direct, respectively: 1. property taxes for the manufacturing​ plant 2. engines for the​ cars 3. janitor wages for the factory.

sustainability.

In recent​ years, there has been an increasing awareness and growing interest in​ ________ and social responsibility by both consumers and corporations.

Work in process inventory

In the basic flow of inventory through a manufacturing​ system, which of the following occurs second in the job costing​ system?

Integrity

Inflating your expenses for a companyminus−sponsored conference that discredits the profession is a violation of what ethical​ standard?

False

Inspection of incoming raw materials and production loss caused by downtime are examples of prevention costs.

$235,300

​George's Chemicals allocates overhead based on machine hours. Selected data for the most recent year follow. 1. Estimated manufacturing overhead cost $235,300 2. Actual manufacturing overhead cost $244,200 3. Estimated machine hours 20,700 4. Actual machine hours 23,100 The estimates were made as of the beginning of the​ year, while the actual results were for the entire year. The amount of manufacturing overhead allocated for the year based on machine hours would have been​ _____

$11.78

​George's Chemicals allocates overhead based on machine hours. Selected data for the most recent year follow. 1. Estimated manufacturing overhead cost $235,500 2. Actual manufacturing overhead cost $244,400 3. Estimated machine hours 20,000 4. Actual machine hours 23,500 The estimates were made as of the beginning of the​ year, while the actual results were for the entire year. The predetermined manufacturing overhead rate per machine hour is closest to