Question 1

A maintenance department would be an example of a:

Accepted Answer

A) cost center. 
B) direct expense. 
C) profit center. 
D) None of these answers is correct. 
A) cost center. 
B) direct expense. 
C) profit center. 
D) None of these answers is correct.

Question 2

Which allocation base is best used to allocate building depreciation?

Accepted Answer

A) Square feet of space used 
B) Number of employees 
C) Hours used 
D) Building depreciation can be separately traced to each department. 
A) Square feet of space used 
B) Number of employees 
C) Hours used 
D) Building depreciation can be separately traced to each department.

Question 3

Paint for the restaurant dining room.________

Accepted Answer

The answer of Paint for the restaurant dining room.________...

Question 4

If an expense is traceable to a department,it would be considered a(n):

Accepted Answer

A) direct expense. 
B) indirect expense. 
C) profit center issue. 
D) cost center issue. 
A) direct expense. 
B) indirect expense. 
C) profit center issue. 
D) cost center issue.

Question 5

A human resource department would be a cost center.

Accepted Answer

A) True 
 B)False

Question 6

To calculate gross profit,subtract operating expenses from net sales.

Accepted Answer

A) True 
 B)False

Question 7

A building's depreciation would be considered an indirect expense.

Accepted Answer

A) True 
 B)False

Question 8

If there is a total of 50,000 square feet of floor space,and the hardware department utilizes 20,000 square feet,what percent of the total square footage is in hardware?

Accepted Answer

A) 20% 
B) 25% 
C) 40% 
D) 80% 
A) 20% 
B) 25% 
C) 40% 
D) 80%

Question 9

Supporters of the contribution margin approach believe that:

Accepted Answer

A) indirect expenses should be departmentalized. 
B) indirect expenses should not be used for evaluating departmental performance. 
C) indirect expenses are proportionally charged to each department. 
D) direct expenses should not be used in evaluating departmental performance. 
A) indirect expenses should be departmentalized. 
B) indirect expenses should not be used for evaluating departmental performance. 
C) indirect expenses are proportionally charged to each department. 
D) direct expenses should not be used in evaluating departmental performance.

Question 10

The difference between a department's gross profit and its operating expenses is known as the:

Accepted Answer

A) departmental operating margin. 
B) departmental operating cost. 
C) departmental operating income. 
D) departmental gross profit. 
A) departmental operating margin. 
B) departmental operating cost. 
C) departmental operating income. 
D) departmental gross profit.

Question 11

Trends in the industry,such as advancements in technology,should not be a consideration in determining whether or not a department is eliminated.

Accepted Answer

A) True 
 B)False

Question 12

The accountant must always consider operating expenses,such as rent and advertising,when determining gross profit for a department.

Accepted Answer

A) True 
 B)False

Question 13

When a company tracks gross profit by department,the sales journal has separate columns for Accounts Receivable for each department.

Accepted Answer

A) True 
 B)False

Question 14

A direct expense should be traceable to a respective department.

Accepted Answer

A) True 
 B)False

Question 15

If the gross sales for the computer department are $4,000 and the book department gross sales are $16,000,what is the allocation for advertising expense of $1,000 to these departments,based on gross sales?

Accepted Answer

A) Computer department $200;book department $800 
B) Computer department $500;book department $500 
C) Computer department $800;book department $200 
D) Computer department $250;book department $750 
A) Computer department $200;book department $800 
B) Computer department $500;book department $500 
C) Computer department $800;book department $200 
D) Computer department $250;book department $750

Question 16

The photography department in a department store experienced the following revenue and expenses during October:
$$\begin{array} { | l | r | } 
\hline \text { Sales } & \$ 6,500 \
\hline \text { Cost of Goods Sold } & 2,000 \
\hline \text { Direct Operating Expenses } & 200 \
\hline \text { Indirect Operating Expenses } & 800 \
\hline
\end{array}$$
The photography departmental net income is:

Accepted Answer

A) $6,500. 
B) $3,700. 
C) $3,500. 
D) $2,200. 
A) $6,500. 
B) $3,700. 
C) $3,500. 
D) $2,200.

Question 17

Electricity for the stove in a restaurant.________

Accepted Answer

The answer of Electricity for the stove in a restaurant.________...

Question 18

Below is a list of departments; you are to identify each as either [1] a profit center or [2] a cost center.
-The repair center of a car dealership.________

Accepted Answer

The answer of Below is a list of departments; you...

Question 19

If the cosmetic department in the store measures 20,000 square feet and the total building cost is $60,000 for a 40,000 square foot building,the cost that would be allocated to the cosmetic department would be:

Accepted Answer

A) $30,000. 
B) $10,000. 
C) $22,500. 
D) $7,500. 
A) $30,000. 
B) $10,000. 
C) $22,500. 
D) $7,500.

Question 20

Why would it be advisable for a company to keep separate accounting records for various departments?

Accepted Answer

Management needs to measure the efficien

Exam 24: Departmental Accounting

A maintenance department would be an example of a:

Which allocation base is best used to allocate building depreciation?

Paint for the restaurant dining room.________

If an expense is traceable to a department,it would be considered a(n):

A human resource department would be a cost center.

To calculate gross profit,subtract operating expenses from net sales.

A building's depreciation would be considered an indirect expense.

If there is a total of 50,000 square feet of floor space,and the hardware department utilizes 20,000 square feet,what percent of the total square footage is in hardware?

Supporters of the contribution margin approach believe that:

The difference between a department's gross profit and its operating expenses is known as the:

Trends in the industry,such as advancements in technology,should not be a consideration in determining whether or not a department is eliminated.

The accountant must always consider operating expenses,such as rent and advertising,when determining gross profit for a department.

When a company tracks gross profit by department,the sales journal has separate columns for Accounts Receivable for each department.

A direct expense should be traceable to a respective department.

If the gross sales for the computer department are $4,000 and the book department gross sales are $16,000,what is the allocation for advertising expense of $1,000 to these departments,based on gross sales?

The photography department in a department store experienced the following revenue and expenses during October: Sales \ 6,500 Cost of Goods Sold 2,000 Direct Operating Expenses 200 Indirect Operating Expenses 800 The photography departmental net income is:

Electricity for the stove in a restaurant.________

Below is a list of departments; you are to identify each as either [1] a profit center or [2] a cost center. -The repair center of a car dealership.________

If the cosmetic department in the store measures 20,000 square feet and the total building cost is $60,000 for a 40,000 square foot building,the cost that would be allocated to the cosmetic department would be:

Why would it be advisable for a company to keep separate accounting records for various departments?

Accounting Concepts and Procedures

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Calculating Pay and Payroll Taxes: the Beginning of the Payroll Process

Paying,recording,and Reporting Payroll and Payroll Taxes:

Sales and Cash Receipts

Purchases and Cash Payments

Preparing a Worksheet for a Merchandise Company

Completion of the Accounting Cycle for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

Accounting for Property,plant,equipment,and Intangible Assets

Partnership

Corporations: Organizations and Stock

Corporations: Stock Values,dividends,treasury Stocks,

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Manufacturing Accounting

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