Chapter 1 Test

Ending Balance of Finished Goods Inventory

Balance Sheet

Ending Balance of Materials Inventory

Balance Sheet

The following information is taken from the financial records of Gunner Manufacturing: ​ Cost of materials used $45,000 Direct labor costs 48,000 Factory overhead 39,000 Work in process, beg. 18,000 Work in process, end. 28,000 ​ What is cost of goods manufactured?

$122,000

Jensen Company reports the following: ​ Direct materials used$345,000Direct labor incurred 250,000Factory overhead incurred 400,000Operating expenses 175,000 ​ ​ Jensen Company's period costs are

$175,000

The following information is available from the current period financial statements: Net income$185,000Depreciation expense28,000Increase in accounts receivable16,000Decrease in accounts payable21,000Decrease in inventory10,000 The net cash flow from operating activities using the indirect method is

$186,000

Ending Balance of Work in Process Inventory

Balance Sheet

The following information is available from the current period financial statements: Net income $157,000 Depreciation expense 28,000 Decrease in accounts receivable 16,000 Increase in accounts payable 21,000 Increase in inventory 10,000 The net cash flow from operating activities using the indirect method is

$212,000

A company used $35,000 of direct materials, incurred $73,000 in direct labor cost, and had $114,000 in factory overhead costs during the period. If beginning and ending work in process inventories were $28,000 and $32,000, respectively, the cost of goods manufactured was

$218,000

Compute conversion costs given the following data: Direct Materials, $347,500; Direct Labor, $196,300; Factory Overhead, $45,290; and Selling Expenses, $187,900.

$241,590

The Darwin Company reports the following information: Sales$76,500Direct materials used 7,300Depreciation on factory equipment 4,700Indirect labor 5,900Direct labor 10,500Factory rent 4,200Factory utilities 1,200Sales salaries expense 15,600Office salaries expense 8,900Indirect materials 1,200 ​ Product costs are

$35,000

Compute conversion costs given the following data: Direct Materials, $347,500; Direct Labor, $196,300; Factory Overhead, $187,900; and Selling Expenses, $45,290.

$384,200

Given the following data: ​ Beginning raw materials inventory $30,000 Materials purchased 65,000 Ending raw materials inventory 40,000 ​ What is the amount of raw materials used?

$55,000

Given the following data: ​ Beginning raw materials inventory $40,000 Materials purchased 65,000 Ending raw materials inventory 30,000 ​What is the amount of raw materials used?

$75,000

Jensen Company reports the following: ​ Direct materials used$345,000Direct labor incurred 250,000Factory overhead incurred 400,000Operating expenses 175,000 ​ ​ Jensen Company's product costs are

$995,000

Wages of assemblers

Direct Labor

Lawn mower engine

Direct Materials

Wheels

Direct Materials

Depreciation of factory equipment

Factory Overhead

Depreciation of worker's tools

Factory Overhead

Grease for wheel axles

Factory Overhead

Oil lubricant for factory machinery

Factory Overhead

If a company had a net income on the income statement, it must have a net increase in cash on the statement of cash flows for the same time period.

False

If a company had a net loss on the income statement, it must have a net decrease in cash on the statement of cash flows for the same time period.

False

Issued Bonds Payable

Financing, Add

Issued Common Stock

Financing, Add

Paid cash dividends

Financing, Subtract

Purchased Treasury Stock

Financing, Subtract

Redeemed long term bonds

Financing, Subtract

Cost of Goods Sold

Income Statement

Sales

Income Statement

Sold Building

Investing, Add

Sold Equipment

Investing, Add

Purchase of long term investments

Investing, Subtract

Purchased Equipment

Investing, Subtract

Purchased a building

Investing, Subtract

Purchased long term investments

Investing, Subtract

Decrease in Prepaid Insurance

Operating, Add

Decrease in merchandise inventory

Operating, Add

Increase in Salaries Payable

Operating, Add

Net Income

Operating, Add

Increase in Accounts Receivable

Operating, Subtract

Which of the following would not appear in the cash flows from investing activities section of the statement of cash flows?

d. Cash paid to retire bonds, $2,000

Which of the following positions would have a salary or wage that is classified as a factory overhead cost by a baking company?

d. Factory supervisor

Which of the following would indicate a cash inflow to appear in the financing activities section of the statement of cash flows?

d. Increase in common stock account

The following information is available from the land account: Opening balance$270,000Sold for $200,000 cash170,000credit entryPurchased for $100,000 cash and $20,000 note payable120,000debit entryEnding balance220,000 Items in the investing activities section of the statement of cash flows should include

a. cash paid for purchase of land, $(100,000).

All of the following are considered manufacturing costs except

a. selling and administrative expenses.

Managerial decisions include all of the following except

a. setting of capital stock prices.

Ralph's Cafe has the following information for June. Cost of materials placed in production$45,000Direct labor20,000Factory overhead14,000Work in process inventory, June 12,900Work in process inventory, June 303,500Finished goods inventory, June 15,000Finished goods inventory, June 304,700 What is the cost of goods sold?

d. $78,700

The following selected data are from a recent statement of cash flows: Net cash flow from operating activities$35,000Net cash flow used for investing activities(20,000)Net cash flow from financing activities60,000Beginning cash balance45,000

a. $120,000

The net income reported on the income statement for the current year was $275,000. Depreciation recorded on fixed assets and amortization of patents for the year were $30,000 and $4,000, respectively. Balances of current asset and current liability accounts at the end and at the beginning of the year are as follows: EndBeginningCash$50,000$60,000Accounts receivable102,000108,000Inventory88,00093,000Prepaid expenses8,5006,500Accounts payable (merchandise creditors)95,00089,000 What is the net cash flow from operating activities reported on the statement of cash flows prepared by the indirect method?

a. $324,000

Which of the following is not an example of a service industry?

a. Aerospace

Which of the following positions would have a salary or wage that is classified as a direct labor cost by a baking company?

a. Baker

Which of the following is not a cash flow element that would be found on the statement of cash flows?

a. Free cash flow

Which of the following would be classified as an indirect cost by a baking company?

a. Salaries of production supervisors

Managerial accounting information uses

b. historical and estimated data.

A company will use managerial reports to do all of the following except

b. report information to government agencies.

Super Sleep Hotel has 2,000 guests who stayed for two nights and rented 150 rooms. How many guest nights did the hotel have during this period?

b. 4,000

Which of the following cash flow elements should be presented first on the statement of cash flows?

b. Cash flows from operating activities

Which of the following would appear in the cash flows from investing activities section of the statement of cash flows?

b. Cash paid for equipment

Which of the following would not be considered a conversion cost by a baking company?

b. Flour

Which of the following would indicate a cash outflow to appear in the financing activities section of the statement of cash flows?

b. Increase in treasury stock account

Which of the following would be shown on a statement of cash flows under the financing activities section?

b. The issuance of bonds

Which of the following is not an example of a service provided within a service industry?

b. Transportation—building diesel engines for locomotives

Cash dividends paid would be shown on the statement of cash flows under __________ activities.

b. financing

Ralph's Cafe has the following information for June: Cost of materials placed in production$45,000Direct labor20,000Factory overhead14,000Work in process inventory, June 12,900Work in process inventory, June 303,500 What is the cost of goods manufactured?

c. $78,400

Which of the following should be subtracted from net income in calculating net cash flow from operating activities using the indirect method?

c. A gain on a sale of a building

Dividends declared during the year were $54,000. The dividends payable account decreased by $8,000. Which of the following will appear in the financing activities section of the statement of cash flows?

c. Cash paid for dividends, $(62,000)

The managerial process that monitors operations and compares actual results to expected results is the __________ phase.

c. controlling

Margot's Deli has the following information for July:Cost of materials placed in production$30,000Direct labor25,000Factory overhead14,000Work in process inventory, July 12,900Work in process inventory, July 313,500What is the cost of goods manufactured?

d. $68,400

Which of the following is an example of direct material cost for a cell phone manufacturer?

cost of phone components

Which of the following is an example of direct labor cost for a cell phone manufacturer?

cost of wages of assembly worker

Which of the following should be added to net income in calculating net cash flow from operating activities using the indirect method?

d. A decrease in inventory