Accounting CH 15

Which of the following is not a manufacturing cost category? A. Cost of goods sold B. Direct materials C. Direct labor D. Manufacturing overhead

A. Cost of goods sold

Which of the following is not a management function? A. Constraining B. Planning C. Controlling D. Directing

A. Constraining

What is work in process inventory generally described as? A. Costs applicable to units that have been started in production but are only partially completed B. Costs associated with the end stage of manufacturing that are almost always complete and ready for customers C. Costs strictly associated with direct labor D. Beginning stage production costs associated with labor costs dealing with bringing in raw materials from the shipping docks

A. Costs applicable to units that have been started in production but are only partially completed

Which one of the following represents a period cost? A. The VP of Sales' salary and benefits B. Overhead allocated to the manufacturing operations C. Labor costs associated with quality control D. Fringe benefits associated with factory workers

A. The VP of Sales' salary and benefits

If the total manufacturing costs are greater than the cost of goods manufactured, which of the following is correct? A. Work in Process Inventory has increased. B. Finished Goods Inventory has increased. C. Work in Process Inventory has decreased. D. Finished Goods Inventory has decreased.

A. Work in Process Inventory has increased.

The principal difference between a merchandising and a manufacturing income statement is the A. cost of goods sold section. B. extraordinary item section. C. operating expense section. D. revenue section.

A. cost of goods sold section.

Which one of the following would not be classified as manufacturing overhead? A. Indirect labor B. Direct materials C. Insurance on factory building D. Indirect materials

B. Direct materials

Managerial accounting does not encompass A. calculating product cost. B. calculating earnings per share. C. determining cost behavior. D. profit planning.

B. calculating earnings per share.

Internal reports are generally A. aggregated. B. detailed. C. regulated. D. unreliable.

B. detailed.

Management accountants would not A. assist in budget planning. B. prepare reports primarily for external users. C. determine cost behavior. D. be concerned with the impact of cost and volume on profits.

B. prepare reports primarily for external users.

If the cost of goods manufactured is less than the cost of goods sold, which of the following is correct? A. Finished Goods Inventory has increased. B. Work in Process Inventory has increased. C. Finished Goods Inventory has decreased. D. Work in Process Inventory has decreased.

C. Finished Goods Inventory has decreased.

Which one of the following is not a cost element in manufacturing a product? A. Manufacturing overhead B. Direct materials C. Office salaries D. Direct labor

C. Office salaries

A manager that is establishing objectives is performing which management function? A. Controlling B. Directing C. Planning D. Constraining

C. Planning

Which of the following is not classified as direct labor? A. Bottlers of beer in a brewery B. Copy machine operators at a copy shop C. Wages of supervisors D. Bakers in a bakery

C. Wages of supervisors

Cost of goods sold A. only appears on merchandising companies' income statements. B. only appears on manufacturing companies' income statements. C. appears on both manufacturing and merchandising companies' income statements. D. is calculated exactly the same for merchandising and manufacturing companies.

C. appears on both manufacturing and merchandising companies' income statements.

A manufacturing company reports cost of goods manufactured as a(n) A. current asset on the balance sheet. B. administrative expense on the income statement. C. component in the calculation of cost of goods sold on the income statement. D. component of the raw materials inventory on the balance sheet.

C. component in the calculation of cost of goods sold on the income statement.

Product costs are also called A. direct costs. B. overhead costs. C. inventoriable costs. D. capitalizable costs.

C. inventoriable costs.

The product cost that is most difficult to associate with a product is A. direct materials. B. direct labor. C. manufacturing overhead. D. advertising.

C. manufacturing overhead.

Both direct materials and indirect materials are A. raw materials. B. manufacturing overhead. C. merchandise inventory. D. sold directly to customers by a manufacturing company.

C. merchandise inventory.

For the work of factory employees to be considered as direct labor, the work must be conveniently and A. materially associated with raw materials conversion. B. periodically associated with raw materials conversion. C. physically associated with raw materials conversion. D. promptly associated with raw materials conversion.

C. physically associated with raw materials conversion.

Which one of the following is not a direct material? A. A tire used for a lawn mower B. Plastic used in the covered case for a home PC C. Steel used in the manufacturing of steel-radial tires D. Lubricant for a ball-bearing joint for a large crane

D. Lubricant for a ball-bearing joint for a large crane

Managerial accounting applies to each of the following types of businesses except A. service firms. B. merchandising firms. C. manufacturing firms. D. Managerial accounting applies to all types of firms.

D. Managerial accounting applies to all types of firms.

Many companies now focus on reducing defects in finished products with the goal of zero defects. This is called A. Activity-based costing. B. Balanced scorecard. C. Value chain. D. Total quality management.

D. Total quality management.

The subtotal, "Cost of goods manufactured" appears on A. a merchandising company's income statement. B. a manufacturing company's income statement. C. both a manufacturing and a merchandising company's income statement. D. neither a merchandising nor a manufacturing company's income statement.

D. a manufacturing company's income statement.

Managerial accounting is applicable to A. service entities. B. manufacturing entities. C. not-for-profit entities. D. all of these.

D. all of these.

The work of factory employees that can be physically and directly associated with converting raw materials into finished goods is A. manufacturing overhead. B. indirect materials. C. indirect labor. D. direct labor.

D. direct labor.

Manufacturing costs include A. direct materials and direct labor only. B. direct materials and manufacturing overhead only. C. direct labor and manufacturing overhead only. D. direct materials, direct labor, and manufacturing overhead.

D. direct materials, direct labor, and manufacturing overhead.

Manufacturing costs include A. direct materials and direct labor only. B. direct materials and manufacturing overhead only. C. direct labor and manufacturing overhead only. D. direct materials, direct labor, and manufacturing overhead.

D. direct materials, direct labor, and manufacturing overhead.

The managerial function of controlling A. is performed only by the controller of a company. B. is only applicable when the company sustains a loss. C. is concerned mainly with operating a manufacturing segment. D. includes performance evaluation by management.

D. includes performance evaluation by management.