Exam 2: Building Blocks of Managerial Accounting

Rustic Living Furniture Company manufactures furniture at its central Kentucky factory. Some of its costs from the past year include: Direct labor costs for Rustic Living Furniture Company totaled

Period costs are

Country Furniture Company manufactures furniture at its Akron, Ohio, factory. Some of its costs from the past year include: Direct labor costs for Country Furniture Company totaled

On the line in front of each statement, enter the letter corresponding to the term that best fits that statement. You may use a letter more than once and some letters may not be used at all. ________ The total cost divided by the total volume. ________ The difference in cost between two alternative courses of action. ________ The combination of direct labor and manufacturing overhead costs. ________ The cost of producing one more unit. ________ Costs that can be traced to the cost object.

Which of the following describes the way in which total fixed costs behave?

Direct materials for a company were $500,700; manufacturing overhead was $250,500; and direct labor was $770,500. Prime costs would total

Toshiba Corporation makes computer chips. Toshiba Corporation would be classified as a

The costs associated with reengineering machinery and its location within the factory to increase efficiency would be considered which element of the value chain?

Controlling costs across the whole value chain often requires a trade-off between the individual elements of the value chain.

Rent on a factory building would be considered to be a ________ cost.

Costs that remain the same among alternatives are

Selected financial information for Brookeville Manufacturing is presented in the following table (000s omitted). What was cost of goods sold?

The financial statements of a merchandiser are more complex than those of a manufacturer.

To forecast total costs at a given level of production, management would use which of the following calculations?

A marginal cost is the cost of making one more unit of a product.

North Pacific Company used $65,000 of direct materials and incurred $43,000 of direct labor costs during the most recent year. Indirect labor amounted to $1,700 while indirect materials used totaled $1,800. Other operating costs pertaining to the factory included utilities of $4,300; maintenance of $6,800; supplies of $1,500; depreciation expense of $8,900; and property taxes of $2,400. There was no beginning or ending finished goods inventory, but work in process inventory began the year with a $6,400 balance and ended the year with a $7,800 balance. Required: Prepare a schedule of cost of goods manufactured for North Pacific Company for the year ended December 31.

The total cost of a cost object can only include the direct costs that are directly traced to that cost object.

How do fixed costs per unit behave?

If a company wants to determine a product's cost, it must assign both direct and indirect costs.

Joe's Bottling Company provided the following expense information for July: What is the total cost for the production category of the value chain?