78 Test Bank for Managerial Accounting 4th Edition by Wild Multiple Choice Questions Period costs for a manufacturing company would flow directly to: 1.. Labor costs that are clearly a
Trang 178 Test Bank for Managerial Accounting 4th Edition
by Wild
Multiple Choice Questions
Period costs for a manufacturing company would flow directly to:
1 A, The current income statement.
2 B, Factory overhead.
3 C, The current balance sheet.
4 D, Job cost sheet.
5 E, The current manufacturing statement.
The following costs are included in a recent summary of data for acompany: advertising expense, $85,000; depreciation expense – factory building, $133,000; direct labor, $250,000; direct material used, $300,000; factory utilities, $105,000; and sales salaries expense, $150,000 Determine the dollar amount of conversion costs
Trang 2An opportunity cost is:
1 A An uncontrollable cost.
2 B A cost of potential benefit lost.
3 C A change in the cost of a component.
4 D A direct cost.
5 E A sunk cost.
Which of the following statements is true?
1 A The IMA’s Statement of Ethical Professional Practice requires
management accountants to be incompetent, maintain confidentiality, act with integrity, and communicate information in a fair and credible manner.
2 B The IMA’s Statement of Ethical Professional Practice requires
management accountants to be competent, maintain confidentiality,
eliminate all fraud, and communicate information in a fair and credible manner.
3 C The IMA’s Statement of Ethical Professional Practice requires
management accountants to be incompetent, maintain confidentiality, act with integrity, and miscommunicate information in a credible manner.
4 D The IMA’s Statement of Ethical Professional Practice requires
management accountants to be competent, maintain confidentiality, act with integrity, and communicate information in a fair and credible manner.
5 E The IMA’s Statement of Ethical Professional Practice requires
management accountants to perform certain checks for fraud, act with integrity, and communicate information in a fair and credible manner.
Which of the following costs would not be classified as factory overhead?
1 A Property taxes on maintenance machinery.
2 B Expired insurance on factory equipment.
3 C Wages of the factory janitor.
4 D Metal doorknobs used on wood cabinets produced.
5 E Small tools used in production.
Labor costs that are clearly associated with specific units or
batches of product because the labor is used to convert raw
materials into finished products called are:
Trang 3The three major cost components of a manufactured product are:
1 A Marketing, selling, and administrative costs.
2 B Indirect labor, indirect materials, and miscellaneous factory expenses.
3 C Direct materials, direct labor, and factory overhead.
4 D Differential costs, opportunity costs, and sunk costs.
5 E General, selling, and administrative costs.
The way of doing business whose goal is to eliminate waste whilesatisfying the customer and providing a positive return to the company is:
1 A Total quality management.
2 B Managerial accounting.
3 C Customer orientation.
4 D Continuous improvement.
5 E Lean business model.
Raw materials that physically become part of the product and can
be traced to specific units or batches of product are called:
1 A Raw materials sold
2 B Chargeable materials
3 C Goods in process
4 D Indirect materials
5 E Direct materials
Managerial accounting information:
1 A Is used mainly by external users.
2 B Involves gathering information about costs for planning and control decisions.
3 C Is generally the only accounting information available to managers.
4 D Can be used for control purposes but not for planning purposes.
Trang 45 E Has little to do with controlling costs.
Which of the following costs is not included in factory overhead?
1 A Payroll taxes on the wages of supervisory factory workers.
2 B Indirect labor.
3 C Depreciation of manufacturing equipment.
4 D Manufacturing supplies used.
5 E Direct materials.
Classifying costs by behavior involves:
1 A Identifying fixed cost and variable cost.
2 B Identifying cost of goods sold and operating costs.
3 C Identifying all costs.
4 D Identifying costs in a physical manner.
5 E Identifying both quantitative and qualitative cost factors.
3 C Is directly traceable to a cost object.
4 D Changes with changes in the volume of activity within the relevant range.
5 E Has already been incurred and cannot be avoided so it is irrelevant for decision making.
The salary paid to the supervisor of an assembly line would normally be classified as:
Trang 51 A The balance sheet
2 B The income statement
3 C The budgeting process
4 D Evaluation reports
5 E Determining product cost
The following costs are included in a recent summary of data for acompany: advertising expense, $85,000; depreciation expense – factory building, $133,000; direct labor, $250,000; direct material used, $300,000; factory utilities, $105,000; and sales salaries expense, $150,000 Determine the dollar amount of prime costs
Goods a company acquires to use in making products are called:
1 A Cost of goods sold.
2 B Raw materials inventory.
3 C Finished goods inventory.
4 D Goods in process inventory.
5 E Conversion costs.
A direct cost is a cost that is:
1 A Identifiable as controllable.
2 B Recorded as part of manufacturing overhead.
3 C Fixed with respect to the volume of activity.
4 D Traceable to a cost object.
5 E Sunk with respect to a cost object.
Costs that are incurred as part of the manufacturing process but are not clearly associated with specific units of product or batches
of production, including all manufacturing costs other than direct material and direct labor costs, are called:
Trang 6The following are all examples of product costs:
1 A Direct material, direct labor and indirect labor.
2 B Direct labor, VP of sales salary, and insurance on the factory.
3 C Depreciation on the factory equipment, depreciation on the office building, and depreciation on the factory building.
4 D Factory insurance, interest expense, and property taxes on the factory.
5 E Office supplies, sales commissions, and maintenance costs on office copier.
An approach to managing inventories and production operations such that units of materials and products are obtained and
provided only as they are needed is called:
1 A Continuous improvement.
2 B Customer orientation.
3 C Just-in-time manufacturing.
4 D Theory of constraints.
5 E Total quality management.
The Malcolm Baldrige Award was established by:
1 A The United Nations.
2 B The U S Chamber of Commerce.
3 C The Malcolm Baldrige Foundation.
4 D The U S Congress.
5 E The SEC.
An attitude of constantly seeking ways to improve company operations, including customer service, product quality, product features, the production process, and employee interactions, is called:
Trang 71 A Continuous improvement.
2 B Customer orientation.
3 C Just-in-time.
4 D Theory of constraints.
5 E Total quality measurement.
Days’ sales in raw materials inventory is a measure of:
1 A How much raw materials are needed for the company to earn a profit.
2 B How long it takes the company to pay for raw materials
3 C How many times a company turns over its raw materials during a period.
4 D How long it takes raw materials to be used in production.
5 E The product costs a company has incurred during a period.
Flexibility of practice when applied to managerial accounting means that:
1 A The information must be presented in electronic format so that it is easily changed.
2 B Managers must be willing to accept the information as the accountants present it to them, rather than in the format they ask for.
3 C The managerial accountants need to be on call 24 hours a day.
4 D The design of a company's managerial accounting system largely
depends on the nature of the business and the arrangement of the internal operations of the company.
5 E Managers must be flexible with information provided in varying forms and using inconsistent measures.
Continuous improvement:
1 A Is a measure of profits.
2 B Is a measure of costs.
3 C Rejects the notion of "good enough."
4 D Is not applicable to most businesses.
5 E Is possible only in service businesses.
The cost of labor that is not clearly associated with specific units
or batches of product is called:
1 A Unspecified labor
Trang 82 B Direct labor
3 C Indirect labor
4 D Basic labor
5 E Joint labor
Which of the following is not a characteristic of all fraud?
1 A It is done to provide direct or indirect benefit to the employee.
2 B It violates the employee’s duties to his employer.
3 C It costs the employer money.
4 D It is secret.
5 E Can be intentional or unintentional.
A management concept that applies quality improvement to all aspects of business activities is called:
1 A Continuous operations.
2 B Customer orientation.
3 C Just-in-time.
4 D Managerial accounting.
5 E Total quality management.
Materials that are used in support of the production process but that do not become a part of the product and are not clearly identified with units or batches of product are called:
1 A Are expenditures necessary and integral to finished products.
2 B Are expenditures identified more with a time period rather than with finished products.
3 C Include selling and administrative expenses.
4 D Are only costs that vary with the volume of activity.
5 E Are only costs that do not vary with the volume of activity.
Trang 9A management concept that encourages all managers and
employees to be in tune with the wants and needs of customers, and which leads to flexible product designs and production
5 E Total quality management.
Which of the following statements regarding fraud is true?
1 A Fraud is a deliberate act.
2 B Fraud can be deliberate or unintentional.
3 C A company with a strong code of ethics can eliminate fraud.
4 D A company with strong internal controls can eliminate fraud.
5 E The most common type of fraud is financial statement fraud.
Which of the following is never included in direct materials costs?
1 A) Invoice costs of direct materials.
2 B) Outgoing delivery charges.
3 C) Materials storage costs.
4 D) Materials handling costs.
5 E) Insurance on stored material.
Managerial accounting is different from financial accounting in that:
1 A Managerial accounting is more focused on the organization as a whole and financial accounting is more focused on subdivisions of the organization.
2 B Managerial accounting never includes nonmonetary information.
3 C Managerial accounting includes many projections and estimates
whereas financial accounting has a minimum of predictions.
4 D Managerial accounting is used extensively by investors, whereas
financial accounting is used only by creditors.
5 E Managerial accounting is mainly used to set stock prices.
Trang 10Costs that are first assigned to inventory are called:
materials inventory based on this data
1 A A lower number of days’ sales in raw materials inventory.
2 B A higher number of days’ sales in raw materials inventory.
3 C That days’ sales in inventory be higher than the days in the accounting period.
4 D That days’ sales in inventory be greater than the operating cycle
5 E That days’ sales in inventory be equal to the days in the accounting period
Another title for goods in process inventory is:
1 A Indirect materials inventory.
2 B Work in process inventory.
3 C Conversion costs.
4 D Direct materials inventory.
5 E Raw materials inventory.
Trang 11The Institute of Management Accountants has developed a code
of ethics that requires management accountants to behave in certain ways Which of the following behaviors is not required?
1 A Finished goods inventory.
2 B Goods in process inventory.
3 C Raw materials inventory.
4 D Cost of goods sold.
3 C Cost of goods sold.
4 D Goods in process inventory.
5 E Finished goods inventory.
78 Free Test Bank for Managerial Accounting 4th
Edition by Wild Multiple Choice Questions - Page 2
Use the following data to determine the cost of goods
manufactured: Beginning finished goods inventory $10,800;
Direct labor 30,600; Beginning goods in process inventory 7,200; General and administrative expenses 13,500; Direct materials used 40,500; Ending goods in process inventory 9,000; Indirect
Trang 12labor 6,300; Ending finished goods inventory 9,500; Indirect
materials 13,500; Depreciation – factory equipment 7,500
1 A Indirect labor costs
2 B Indirect material costs
The following information relates to the manufacturing operations
of the IMH Publishing Corporation for the year: Raw materials inventory: $ 57,000 (Beginning); $60,000 (Ending) Finished
goods: 68,000 (Beginning); 60,000 (Ending) The raw materials
Trang 13used in manufacturing during the year totaled $118,000 Raw materials purchased during the year amount to:
1 A, Ending finished goods inventory.
2 B, Total manufacturing costs.
3 C, Ending goods in process inventory.
4 D, Cost of goods manufactured.
5 E, Cost of goods sold.
Which of the following accounts would appear on a manufacturingstatement?
1 A Raw materials, factory insurance expired, indirect labor.
2 B Raw materials, goods in process, finished goods.
3 C Factory buildings, delivery equipment, and depreciation on factory equipment.
4 D Direct labor, indirect labor, sales salaries.
5 E Direct labor, factory repairs and maintenance, wages payable.
Trang 14A financial report that summarizes the amounts and types of
costs that were incurred in the manufacturing process during the period is a:
Trang 151 A Raw materials processed.
2 B Factory supplies used.
3 C Cost of goods manufactured.
4 D Total finished goods.
5 E Cost of goods sold.
The beginning and ending finished goods inventories of the Prize Ring manufacturing company were $75,000 and $73,000
respectively If cost of goods sold equaled $66,000, what is the amount of cost of goods manufactured for this period?
1 A $2,000
2 B $64,000
3 C $68,000
4 D $82,000
Trang 16Use the following information to compute the cost of goods
manufactured: Beginning raw materials $ 5,500; Ending raw
materials 4,000; Direct labor 12,250; Raw material purchases 7,400; Depreciation on factory equipment 6,500; Factory repairs and maintenance 3,300; Beginning finished goods inventory
10,200; Ending finished goods inventory 8,900; Beginning goods
in process inventory 5,700; Ending goods in process inventory 6,300
Trang 17Use the following data to determine the cost of goods
manufactured Beginning finished goods inventory $ 6,200; Directlabor 15,100; Beginning goods in process inventory 1,500;
General and administrative expenses 20,000; Direct materials used 20,500; Ending goods in process inventory 4,000; Indirect labor 7,300; Ending finished goods inventory 5,000; Indirect
materials 3,400; Depreciation – factory equipment 2,000
The beginning and ending finished goods inventories of a
company were $91,000 and $94,000 respectively If cost of goodssold equaled $800,000, what is the amount of cost of goods
manufactured for this period?
A manufacturing company has a beginning finished goods
inventory of $14,600, raw material purchases of $18,000, cost of goods manufactured of $32,500, and an ending finished goods inventory of $17,800 The cost of goods sold for this company is: