Managerial KCC - Test 1
what types of companies can benefit from managerial accounting
manufacturers retailers service providers
one key difference appears when comparing the income statements of a manufacturing company to a merchandising company, what is that difference?
manufacturing companies use cost of goods manufactured and merchandising companies use cost of goods purchased
indicate which of the following statements is not correct
manufacturing costs are assigned the same way in a job order and in a process cost system
work in process inventory is debited for all of the following except
manufacturing overhead incurred
equivalent units are computed for
materials and conversion costs
in a manufacturing company, the cost of factory labor consists of all of the following except
net earnings of factory workers
Companies assign manufacturing overhead to work in process on an estimated basis through the use of a(n)
predetermined overhead rate
Mandela manufacturing thinks that the best activity base for its manufacturing overhead is machine hours. the estimate of annual overhead costs is $540,000. the company used $1000 hours of processing for job A15 during the period and incurred actual overhead costs of $580,000. the budgeted machine hours for the year totaled 20,000. What amount of manufacturing overhead should be applied to job A15
predetermined overhead rate = 540000/20000 = 27 1000 x 27 = 27000
a process cost system would be used for all of the following except
printing of wedding invitations
product costs include each of the following except
selling and administrative expenses
which of the following items is not a characteristic of a process cost system?
the products produced are heterogeneous in nature
which one of the following is a characteristic that job-order cost systems and process cost have in common?
they both use perpetual inventory systems
which one of the following transactions causes the manufacturing overhead account to be debited in a job order cost accounting system
used indirect materials
what is the cost of goods manufactured for march? raw materials acquired for cash. $82500 cost of direct materials used in production. 81900 cost to ship products to customers. 1000 direct labor costs incurred. 41000 total manufacturing overhead incurred. 25000 raw materials inventory, beginning. 3600 raw materials inventory, ending. 3600 work in process inventory, beginning. 12000 work in process inventory, ending. 14200
work process inventory beginning + (direct materials used in production +direct labor costs incurred + manufacturing overhead incurred) - work in process inventory, ending 12000 + (81900+41000+25000) - 14200 = 145700
why do companies, using job order costing to estimate manufacturing overhead costs, allocate them to individual jobs and products
it enables the company to determine the approximate cost of each job as it gets completed
a company is more likely to use a job costing system if
it manufactures products with unique characteristics
which of the following statements is true about managerial accounting
it provides more detailed information than financial accounting does
in recent years, as production has become more automated, there has been a significant trend towards use of _____________ as the activity base in assigning overhead
machine hours
pharmco incurred the following costs while manufacturing its product: $120,000 materials used in production $60,000 factory depreciation $12,000 property tax on the administrative offices $95,000 labor costs of assembly-line workers $8,000 factory supplies used $13,000 advertising expense $20,000 property tax on factory $23,000 delivery expense $53,000 salaries on staff $17,000 sales commission the total product costs for Pharmco are:
12000 + 95000 + 60000 + 8000 + 20000 = 303000
Barry's BBQ incurred the following costs: $1400 for ribs 45 hours of labor to cook the ribs at $10 per hour $50 for sauces and seasonings $300 for advertising signs for the ribs $150 to clean the grill after cooking $100 administrative costs how much are the total product costs?
1400 + (45*10) + 50 + 150 = 2050
the mixing department's output during the period consists of 20,000 units completed and transferred out, and 5,000 units in ending work in process 60% complete as to conversion and material costs. Beginning inventory is 1000 units, 40% complete as to materials and conversion costs. Assuming the weighted average method, the equivalent units of production are
20,000 + (5000 * 60%) = 23000
Campbell's manufactures chicken noodle soup, in which every can is virtually identical. there is no need to calculate the cost of each can. Which of the following companies would most likely use process costing for the product listed that it produces?
Campbell's - chicken noodle soup
which of the following managerial accounting techniques attempts to allocate manufacturing overhead in a more meaningful fashion?
activity-based costing
a process cost system would be used by all of the following except
advertising company
Dartmouth company has two process departments, matching and assembly, that produce products. at what point can the company add manufacturing overhead costs to the products?
as the production takes place in each of the two process departments
ford company has two process departments, cutting and shaping, that produce products. at what point can direct materials be added to product costs?
at the point the materials are used in production during either the cutting or shaping departments
in computing equivalent units using the weighted-average method, ________ is not part of the equivalent units of production formula
beginning work in process
which one of the following occurs in a process cost system
costs are accumulated in a production cost report
manufacturing overhead includes all of the following except
direct materials
