Question 1

Finished goods inventory does not appear on a cost of goods manufactured schedule.

Accepted Answer

A) True 
 B)False

Question 2

Which one of the following is not a direct material?

Accepted Answer

A)  A tire used for a lawn mower 
B)  Plastic used in the covered case for a home PC 
C)  Steel used in the manufacturing of steel-radial tires 
D)  Lubricant for a ball-bearing joint for a large crane 
A)  A tire used for a lawn mower 
B)  Plastic used in the covered case for a home PC 
C)  Steel used in the manufacturing of steel-radial tires 
D)  Lubricant for a ball-bearing joint for a large crane

Question 3

A manufacturing process requires small amounts of glue. The glue used in the production process is classified as a(n)

Accepted Answer

A)  period cost. 
B)  indirect material. 
C)  direct material. 
D)  miscellaneous expense. 
A)  period cost. 
B)  indirect material. 
C)  direct material. 
D)  miscellaneous expense.

Question 4

Which of the following is not classified as direct labor?

Accepted Answer

A)  Bottlers of beer in a brewery 
B)  Copy machine operators at a copy shop 
C)  Wages of supervisors 
D)  Bakers in a bakery 
A)  Bottlers of beer in a brewery 
B)  Copy machine operators at a copy shop 
C)  Wages of supervisors 
D)  Bakers in a bakery

Question 5

Molina Company has beginning and ending work in process inventories of $130,000 and $145,000 respectively. If total manufacturing costs are $680,000, what is the total cost of goods manufactured?

Accepted Answer

A)  $810,000. 
B)  $825,000. 
C)  $665,000. 
D)  $695,000. 
A)  $810,000. 
B)  $825,000. 
C)  $665,000. 
D)  $695,000.

Question 6

Using $3,000,000 as the total manufacturing costs, compute the cost of goods manufactured using the following information. $\begin{array}{lll}
\text { Raw materials inventory, January } 1 & 20,000 \
\text { Raw materials inventory, December } 31 & 40,000 \
\text { Work in process, January } 1 & 18,000\
\text { Work in process, December } 31 & 12,000 \
\text { Finished goods, January } 1 & 40,000 \
\text { Finished goods, December } 31 & 32,000 \
\text { Raw materials purchases } & 1,700,000\
\text { Direct labor } & 760,000 \
\text { Factory utilities } & 150,000 \
\text { Indirect labor } & 50,000 \
\text { Factory depreciation } & 400,000 \
\text { Operating expenses } & 420,000
\end{array}$

Accepted Answer

A)  $3,014,000. 
B)  $2,994,000. 
C)  $3,006,000. 
D)  $3,008,000. 
A)  $3,014,000. 
B)  $2,994,000. 
C)  $3,006,000. 
D)  $3,008,000.

Question 7

Which one of the following characteristics would likely be associated with a just-in-time inventory method?

Accepted Answer

A)  Ending inventory of work in process that would allow several production runs 
B)  A backlog of inventory orders not yet shipped 
C)  Minimal finished goods inventory on hand 
D)  An understanding with customers that they may come to the showroom and select from inventory on hand 
A)  Ending inventory of work in process that would allow several production runs 
B)  A backlog of inventory orders not yet shipped 
C)  Minimal finished goods inventory on hand 
D)  An understanding with customers that they may come to the showroom and select from inventory on hand

Question 8

Both direct materials and indirect materials are

Accepted Answer

A)  raw materials. 
B)  manufacturing overhead. 
C)  merchandise inventory. 
D)  sold directly to customers by a manufacturing company. 
A)  raw materials. 
B)  manufacturing overhead. 
C)  merchandise inventory. 
D)  sold directly to customers by a manufacturing company.

Question 9

In an analogous sense, external user is to internal user as generally accepted accounting principles are to

Accepted Answer

A)  timely. 
B)  special-purpose. 
C)  relevance to decision. 
D)  SEC. 
A)  timely. 
B)  special-purpose. 
C)  relevance to decision. 
D)  SEC.

Question 10

In calculating gross profit for a manufacturing company, the cost of goods manufactured is deducted from net sales.

Accepted Answer

A) True 
 B)False

Question 11

Because of automation, which component of product cost is declining?

Accepted Answer

A)  Direct labor 
B)  Direct materials 
C)  Manufacturing overhead 
D)  Advertising 
A)  Direct labor 
B)  Direct materials 
C)  Manufacturing overhead 
D)  Advertising

Question 12

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

Accepted Answer

A)  Indirect labor 
B)  Direct materials 
C)  Insurance on factory building 
D)  Indirect materials 
A)  Indirect labor 
B)  Direct materials 
C)  Insurance on factory building 
D)  Indirect materials

Question 13

Manufacturing costs include

Accepted Answer

A)  direct materials and direct labor only. 
B)  direct materials and manufacturing overhead only. 
C)  direct labor and manufacturing overhead only. 
D)  direct materials, direct labor, and manufacturing overhead. 
A)  direct materials and direct labor only. 
B)  direct materials and manufacturing overhead only. 
C)  direct labor and manufacturing overhead only. 
D)  direct materials, direct labor, and manufacturing overhead.

Question 14

Penner Company reported total manufacturing costs of $450,000, manufacturing overhead totaling $78,000, and direct materials totaling $96,000. How much is direct labor cost?

Accepted Answer

A)  Cannot be determined from the information provided. 
B)  $624,000 
C)  $354,000 
D)  $276,000 
A)  Cannot be determined from the information provided. 
B)  $624,000 
C)  $354,000 
D)  $276,000

Question 15

On the costs of goods manufactured schedule, the item raw materials inventory (ending) appears as a(n)

Accepted Answer

A)  addition to raw materials purchases. 
B)  addition to raw materials available for use. 
C)  subtraction from raw materials available for use. 
D)  subtraction from raw materials purchases. 
A)  addition to raw materials purchases. 
B)  addition to raw materials available for use. 
C)  subtraction from raw materials available for use. 
D)  subtraction from raw materials purchases.

Question 16

Period costs are not inventoriable costs.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following statements about internal reports is not true?

Accepted Answer

A)  The content of internal reports may extend beyond the double-entry accounting system. 
B)  Internal reports may show all amounts at market values. 
C)  Internal reports may discuss prospective events. 
D)  Most internal reports are summarized rather than detailed. 
A)  The content of internal reports may extend beyond the double-entry accounting system. 
B)  Internal reports may show all amounts at market values. 
C)  Internal reports may discuss prospective events. 
D)  Most internal reports are summarized rather than detailed.

Question 18

Both direct labor cost and indirect labor cost are product costs.

Accepted Answer

A) True 
 B)False

Question 19

A manufacturing company calculates cost of goods sold as follows:

Accepted Answer

A)  Beginning FG inventory + cost of goods purchased - ending FG inventory. 
B)  Ending FG inventory - cost of goods manufactured + beginning FG inventory. 
C)  Beginning FG inventory - cost of goods manufactured - ending FG inventory. 
D)  Beginning FG inventory + cost of goods manufactured - ending FG inventory. 
A)  Beginning FG inventory + cost of goods purchased - ending FG inventory. 
B)  Ending FG inventory - cost of goods manufactured + beginning FG inventory. 
C)  Beginning FG inventory - cost of goods manufactured - ending FG inventory. 
D)  Beginning FG inventory + cost of goods manufactured - ending FG inventory.

Question 20

The wages of a timekeeper in the factory would be classified as

Accepted Answer

A)  a period cost. 
B)  direct labor. 
C)  indirect labor. 
D)  compliance costs. 
A)  a period cost. 
B)  direct labor. 
C)  indirect labor. 
D)  compliance costs.

Finished goods inventory does not appear on a cost of goods manufactured schedule.

Which one of the following is not a direct material?

A manufacturing process requires small amounts of glue. The glue used in the production process is classified as a(n)

Which of the following is not classified as direct labor?

Molina Company has beginning and ending work in process inventories of $130,000 and $145,000 respectively. If total manufacturing costs are $680,000, what is the total cost of goods manufactured?

Which one of the following characteristics would likely be associated with a just-in-time inventory method?

Both direct materials and indirect materials are

In an analogous sense, external user is to internal user as generally accepted accounting principles are to

In calculating gross profit for a manufacturing company, the cost of goods manufactured is deducted from net sales.

Because of automation, which component of product cost is declining?

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

Manufacturing costs include

Penner Company reported total manufacturing costs of $450,000, manufacturing overhead totaling $78,000, and direct materials totaling $96,000. How much is direct labor cost?

On the costs of goods manufactured schedule, the item raw materials inventory (ending) appears as a(n)

Period costs are not inventoriable costs.

Which of the following statements about internal reports is not true?

Both direct labor cost and indirect labor cost are product costs.

A manufacturing company calculates cost of goods sold as follows:

The wages of a timekeeper in the factory would be classified as

Job Order Costing

Process Costing

Activity-Based Costing

Cost-Volume-Profit

Cost-Volume-Profit Analysis: Additional Issues

Incremental Analysis

Pricing

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Statement of Cash Flows

Financial Statement Analysis

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Exam 1: Managerial Accounting

Finished goods inventory does not appear on a cost of goods manufactured schedule.

Which one of the following is not a direct material?

A manufacturing process requires small amounts of glue. The glue used in the production process is classified as a(n)

Which of the following is not classified as direct labor?

Molina Company has beginning and ending work in process inventories of $130,000 and $145,000 respectively. If total manufacturing costs are $680,000, what is the total cost of goods manufactured?

Which one of the following characteristics would likely be associated with a just-in-time inventory method?

Both direct materials and indirect materials are

In an analogous sense, external user is to internal user as generally accepted accounting principles are to

In calculating gross profit for a manufacturing company, the cost of goods manufactured is deducted from net sales.

Because of automation, which component of product cost is declining?

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

Manufacturing costs include

Penner Company reported total manufacturing costs of $450,000, manufacturing overhead totaling $78,000, and direct materials totaling $96,000. How much is direct labor cost?

On the costs of goods manufactured schedule, the item raw materials inventory (ending) appears as a(n)

Period costs are not inventoriable costs.

Which of the following statements about internal reports is not true?

Both direct labor cost and indirect labor cost are product costs.

A manufacturing company calculates cost of goods sold as follows:

The wages of a timekeeper in the factory would be classified as

Job Order Costing

Process Costing

Activity-Based Costing

Cost-Volume-Profit

Cost-Volume-Profit Analysis: Additional Issues

Incremental Analysis

Pricing

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Statement of Cash Flows

Financial Statement Analysis

Filters