Exam 19: Managerial Accounting

Internal reports must be communicated

Management accountants would not

For each item listed below indicate in the space to the left whether the item would be considered a product cost or a period cost for a manufacturing company. Use the following code:

Managerial accounting internal reports are prepared more frequently than are classified financial statements.

Total period costs are deducted from total cost of work in process to calculate cost of goods manufactured.

On the costs of goods manufactured schedule depreciation on factory equipment

Benson Inc.'s accounting records reflect the following inventories: Dec. 31,2016 Dec. 31, 2017 Raw materials inventory \ 80,000 \ 64,000 Work in process inventory 104,000 116,000 Finished goods inventory 100,000 92,000 During 2017 Benson purchased $1450000 of raw materials incurred direct labor costs of $250000 and incurred manufacturing overhead totaling $160000. How much is total manufacturing costs incurred during 2017 for Benson?

Benson Inc.'s accounting records reflect the following inventories: Dec. 31,2016 Dec. 31, 2017 Raw materials inventory \ 80,000 \ 64,000 Work in process inventory 104,000 116,000 Finished goods inventory 100,000 92,000 During 2017 Benson purchased $1450000 of raw materials incurred direct labor costs of $250000 and incurred manufacturing overhead totaling $160000. How much raw materials were transferred to production during 2017 for Benson?

Identify whether each of the following is classified as a product cost or a period cost. ______________ 1. Direct labor ______________ 2. Direct materials ______________ 3. Factory utilities ______________ 4. Repairs to office equipment ______________ 5. Property taxes on factory building ______________ 6. Sales salaries

Managerial accounting does not encompass

Which one of the following does not appear on the balance sheet of a manufacturing company?

The management function of organizing and directing is mainly concerned with setting goals and objectives for the entity.

Managerial accounting applies to all forms of business organizations.

Given the following data for Mehring Company compute (A) total manufacturing costs and (B) cost of goods manufactured: Direct materials used \ 230,000 Beginning work in process \ 30,000 Direct labor 150,000 Ending work in process 15,000 Manufacturing overhead 255,000 Beginning finished goods 38,000 Operating expenses 263,000 Ending finished goods 23,000 A) \ 620,000 \ 650,000 B) \ 635,000 \ 620,000 C) \ 635,000 \ 650,000 D) \ 650,000 \ 665,000

Given the following data for Glennon Company compute (A) total manufacturing costs and (B) costs of goods manufactured: Direct materials used \ 270,000 Beginning work in process \ 40,000 Direct labor 200,000 Ending work in process 20,000 Manufacturing overhead 250,000 Beginning finished goods 50,000 Operating expenses 350,000 Ending finished goods 30,000 A) \ 700,000 \ 740,000 B) \7 20,000 \ 700,000 C) \ 720,000 \ 740,000 D) \ 740,000 \ 760,000

If the amount of "Cost of goods manufactured" during a period exceeds the amount of "Total manufacturing costs" for the period then

Million Dollar Mills is a textile manufacturing firm located in the southern United States. The company carefully prepares all financial statements in accordance with GAAP and gives a copy of all financial statements to each department. In addition the company keeps records on quality control safety and environmental pollution by the company. It then prepares "scorecards" for each department indicating their performance. Recently the financial impact of the second set of information was added and the information has been used in the evaluation of employees for merit pay and promotions. At the most recent employee meeting Tyler Hanes marketing manager expressed his discomfort with the system. He said there was no guarantee that the second set of information was fair since there were no generally accepted principles for this kind of information. He also said that it was kind of like keeping two sets of books-one following all legal requirements and the other one actually used by the company. Required: 1. Is it ethical to evaluate managers in the way described? Explain briefly. 2. Name at least two safeguards the company could build into its system to ensure the ethical treatment of employees.

The beginning work in process inventory appears on both the balance sheet and the cost of goods manufactured schedule of a manufacturing company.

Costas Company has beginning and ending raw materials inventories of $64000 and $80000 respectively. If direct materials used were $310000 what was the cost of raw materials purchased?

The ending work in process inventory is subtracted from the total cost of work in process to calculate ______________________.