Accounting 321 Final
For external reporting
costs are classified as either inventoriable or period costs
Unit cost data can most mislead decisions by
not computing unit costs at the same output level
The practice of developing reasonably challenging budgets tend to help:
motivate improved performance as employees work more intensely to avoid failure
An unfavorable variance indicates that
actual units sold are less than the budgeted units
Heavy Products, Inc. developed standard costs for direct material and direct labor. In 2017, AII estimated the following standard costs for one of their major products, the 10-gallon plastic container.
$115,000 unfavorable
North Street Corporation manufactures two models of motorized go-carts, a standard and a deluxe model. The following activity and cost information has been compiled:Number of Number of Number ofProduct Setups Components Direct Labor HoursStandard 17 6 710Deluxe 27 18 420Overhead costs $15,400 $22,560Assume a traditional costing system applies the $37,960 of overhead costs based on direct labor hours. What is the total amount of overhead cost assigned to the deluxe model? (Do not round interim calculations. Round the final answer to the nearest whole dollar.)
$14,109
Bell Company sells several products. Information of average revenue and costs is as follows:Selling price per unit $33.00Variable costs per unit:Direct material $6.00Direct manufacturing labor $1.50Manufacturing overhead $0.30Selling costs $2.25Annual fixed costs $113,000The company sells 10,000 units.The contribution margin per unit is
$22.95
How many units would have to be sold to yield a target operating income of $26,000, assuming variable costs are $27 per unit, total fixed costs are $2,000, and the unit selling price is $32?
5600
Assembly department of Zahra Technologies had 200 units as work in process at the beginning of the month. These units were 45% complete. It has 300 units which are 35% complete at the end of the month. During the month, it completed and transferred 500 units. Direct materials are added at the beginning of production. Conversion costs are allocated evenly throughout production. Zahra uses weighted-average process-costing method. Calculate the total equivalent units in ending inventory for assignment of conversion costs?
105 units
Sky High sells helicopters. During the current year, 130 helicopters were sold resulting in $840,000 of sales revenue, $260,000 of variable costs, and $350,000 of fixed costs. The number of helicopters that must be sold to achieve $320,000 of operating income is
151 units
Assembly department of Zahra Technologies had 100 units as work in process at the beginning of the month. These units were 45% complete. It has 200 units which are 20% complete at the end of the month. During the month, it completed and transferred 500 units. Direct materials are added at the beginning of production. Conversion costs are allocated evenly throughout production. Zahra uses weighted-average process-costing method. What is the total equivalent units in ending inventory for assignment of direct materials cost?
200 units
SaleCo sells 8,400 units resulting in $120,000 of sales revenue, $35,000 of variable costs, and $45,000 of fixed costs. The contribution margin percentage is ________. Group of answer choices
70.83%
Which of the following is true of cost accounting?
It is part of both management and financial accounting systems.
Place the five steps in the decision-making process in the correct order:
CAEBD
is a grouping of individual indirect cost items.
Cost Pool
A manufacturer utilizes three separate indirect cost pools. Which of the following is true?
Each indirect cost pool utilizes a separate cost-allocation rate
A major advantage of using the FIFO process-costing method is that: Group of answer choices
FIFO provides managers with info
Process costing would most likely be used to assign costs to products produced by which of these companies?
Flour
is used to record and accumulate all the costs assigned to a specific job.
Job-cost record
Which of the following differentiates job costing from process costing?
Process costing is used when each unit of output is identical, and job costing deals with unique products not produced in batches.
A company has three products possible products that it can produce in a machine intensive production process. Capacity is constrained by the number of hours the machines can run during a period and the products are so popular that all units produced will be sold. Here is additional information: CHART
Product B should be emphasized if the goal is to maximize contribution margin
Merchandising-sectors
Purchase and sell tangible products without changing their basic form
Which item is an indication of integrity under the Standards of Ethical Conduct?
Refrain from engaging in any conduct that would prejudice carrying out duties ethically.
Which of the following is an assumption of CVP analysis? Group of answer choices
Total costs can be divided into a fixed component and a component that is variable with respect to the level of output
Atlas Manufacturing produces a unique valve, and has the capacity to produce 50,000 valves annually. Currently Atlas produces 40,000 valves and is thinking about increasing production to 45,000 valves next year. What is the most likely behavior of total manufacturing costs and unit manufacturing costs given this change? Group of answer choices
Total manufacturing costs will increase and unit manufacturing costs will decrease.
Spoilage that is not inherent in a particular production process and would not arise under efficient operating conditions is referred to as
abnormal spoilage
Costs of normal spoilage are usually accounted for as
a component of the cost of good units manufactured
Job-costing is likely to be used by
advertising agencies
Sunk Costs
are irrelevant to economic decisions.
The margin of safety is the difference between
budgeted revenues and breakeven revenues
When spoiled goods have a disposal value, the net cost of the spoilage is computed by
deducting disposal value from the cost...
Total manufacturing costs are comprised of
direct materials costs, direct manufacturing labor costs, and manufacturing overhead costs
Which of the following is true if the production volume decreases?
fixed cost per unit increases
Management accounting
focuses on estimating future revenues, costs, and other measures to forecast activities and their results
Activity based costing system differs from traditional costing systems in the treatment of
indirect costs
The sales forecast should be primarily based on
input from sales managers and sales representatives
Which of the following is the costing system used for mass produced like or similar units of products?
process costing
A manufacturing plant produces two product lines: golf equipment and soccer equipment. An example of indirect cost for the soccer equipment line is the ________. Group of answer choices
property taxes paid on the land and building (plant)
The breakeven point is the activity level where
revenues equal the sum of variable and fixed costs
Which of the following is an example of scrap?
short lengths from woodworking that must be discarded
Which of the following is not a concern for management accountants in formulating a strategy?
strategizing compliance with GAAP (Generally Accepted Accounting Principles
The primary user of management accounting information is a(n)
the controller
A leather shoe manufacturer makes "duck" boots that consist of leather and rubber. Some of the books are defective and are sold in the factory store at deep discounts. Leather strips from the cutting process and rubber shavings are byproducts of the process. The leather strips have no use and are discarded while the rubber scraps are collected and periodically picked up by a recycling company at no cost to the shoe manufacturer. Which of the following classifications of these items would be accurate? Group of answer choices
the defective boots are spoilage and the leather and the rubber are scrap
ABC and traditional systems are quite similar in
the treatment of direct costs
Which of the following is true of budgets when they are administered thoughtfully?
they promote coordination within subunits of a company
Which of the following is true if the volume of sales increases (within a relevant range)? Group of answer choices
total variable costs increase
Which of the following describes rework?
units of production that. dont meet specifications but are repaired and then sold
Actual costing is a costing system that traces direct costs to a cost object by
using the actual direct cost rates times the actual quantities of the direct-cost inputs
Product-cost cross-subsidization means that:
when a company undercosts one of its products it will over cost at least one of its others
