Exam 19: Managerial Accounting

Which of the following are period costs?

When the physical association of raw materials with the finished product is too small to trace in terms of cost they are usually classified as indirect materials.

Dolan Company's accounting records reflect the following inventories: Dec. 31, 2017 Dec. 31, 2016 Raw materials inventory \ 310,000 \ 260,000 Work in process inventory 300,000 160,000 Finished goods inventory 190,000 150,000 During 2017 $800000 of raw materials were purchased direct labor costs amounted to $670000 and manufacturing overhead incurred was $640000. Dolan Company's total manufacturing costs incurred in 2017 amounted to

Assuming the cost of direct materials used is $1800000 compute the total manufacturing costs using the information below. Raw materials inventory, January 1 \ 30,000 Raw materials inventory, December 31 60,000 Work in process, January 1 27,000 Work in process, December 31 18,000 Finished goods, January 1 60,000 Finished goods, December 31 48,000 Raw materials purchases 1,800,000 Direct labor 890,000 Factory utilities 225,000 Indirect labor 75,000 Factory depreciation 500,000 Operating expenses 630,000

Which one of the following is not a direct material?

A manager that is establishing objectives is performing which management function?

The principal difference between a merchandising and a manufacturing income statement is the

Which of the following is not a manufacturing cost category?

Many companies have significantly lowered inventory levels and costs using just-in-time inventory methods.

Presented below is a list of costs and expenses incurred in the factory by Nu-Way Corporation a manufacturer of recreational vehicles. ____ 1. Property taxes on the factory land ____ 2. Nails and glue used in production ____ 3. Cabinet maker's wages ____ 4. Factory supervisors' salaries ____ 5. Metal used in manufacturing ____ 6. Depreciation on factory machines ____ 7. Factory utilities ____ 8. Carpeting for the recreational vehicles ____ 9. Property taxes on the factory building ____ 10. Insurance on factory equipment Instructions Classify the above items into the following categories: DM - Direct Materials DL - Direct Labor MO - Manufacturing Overhead

Which one of the following is not considered as material costs?

Volumetrica a producer of audio equipment for large computer systems is reviewing its policies as part of a biannual self-examination of the company. As part of this process all managers have been asked to carefully examine costs and determine as closely as possible which costs are direct and which are indirect. Linda Bedard and Sam Hilton managers of different manufacturing departments in the same building have been working together. They found the following four costs that could be economically traced to the products but have historically been a part of overhead: $\bullet$ Cost of setting up the machinery for a different production run. $\bullet$ Cost of minor assembly components such as knobs and switches. $\bullet$ Cost of packaging which is quite different for each model. $\bullet$ Cost of inspecting and testing each model. None of the costs is significant by itself but together these four costs make up between 10 and 15% of the total cost of the product. Linda favors "leaving well enough alone" as she puts it and leaving these costs in overhead. She is afraid that her volunteering to trace these costs will result in her having to trace many more costs in the future. Sam on the other hand prefers to have the product cost as accurate as possible. He points out that these costs are already known and the process would require little extra work. Required: You have been called on in your function as accounting manager to resolve the dispute. Write a memo to Linda and Sam supporting one or the other position. Be sure to adequately defend your position but be brief.

The ______________ function is concerned with setting goals and objectives for the entity.

The managerial function of controlling

What is work in process inventory generally described as?

Determine whether each of the following costs should be classified as direct materials (DM) direct labor (DL) or manufacturing overhead (MO).

Exercising good judgment in performing the managerial functions and choosing among alternative courses of action is called ______________.

Which one of the following would not be classified as manufacturing overhead?

Indicate whether each of the following costs of a pencil manufacturer would be classified as direct materials (DM) direct labor (DL) or manufacturing overhead (MO). a. ____ Depreciation of pencil painting machinery b. ____ Lead inserted into pencils c. ____ Factory utilities d. ____ Wages of assembly line worker e. ____ Salary of supervisor f. ____ Factory machinery maintenance g. ____ Wood h. ____ Eraser compound

The total cost of a finished product does not generally contain equal amounts of materials labor and overhead costs.