Question 1

Manufacturing companies use a predetermined overhead rate; such rates are not used by service companies.

Accepted Answer

A) True 
 B)False

Question 2

The cost of indirect labor will initially be charged to:

Accepted Answer

A)  Cost of Goods Sold. 
B)  Finished Goods Inventory. 
C)  Manufacturing Overhead. 
D)  Wages Expense. 
A)  Cost of Goods Sold. 
B)  Finished Goods Inventory. 
C)  Manufacturing Overhead. 
D)  Wages Expense.

Question 3

Carolina Company placed $26,500 of raw materials into production.The recognition of this event will:

Accepted Answer

A)  decrease net income. 
B)  not affect total assets. 
C)  increase revenue. 
D)  decrease cash flow from investing activities. 
A)  decrease net income. 
B)  not affect total assets. 
C)  increase revenue. 
D)  decrease cash flow from investing activities.

Question 4

Which of the following statement(s)is/are correct? I.A predetermined overhead rate is used to assign estimated overhead costs to work in process inventory.
II)The predetermined overhead rate is calculated by dividing estimated overhead cost by the estimated volume or level of activity.
III)The most common means of allocating overhead costs is to calculate a predetermined overhead rate at the end of the period.

Accepted Answer

A)  I 
B)  I and III 
C)  II 
D)  I and II 
A)  I 
B)  I and III 
C)  II 
D)  I and II

Question 5

Paying for factory utilities used during the current month is a(n):

Accepted Answer

A)  asset exchange transaction. 
B)  asset use transaction. 
C)  asset source transaction. 
D)  claims exchange transaction. 
A)  asset exchange transaction. 
B)  asset use transaction. 
C)  asset source transaction. 
D)  claims exchange transaction.

Question 6

During February,Benke Manufacturing Company paid $18,000 in property taxes on one of its factory buildings.This overhead cost should be allocated to units completed during the month it was paid.

Accepted Answer

A) True 
 B)False

Question 7

Orlando Company placed $142 of raw materials into production.How would this transaction affect the company's financial statements?

Accepted Answer

A)  $$\begin{array} { | l | l | l | l | l | l | l | l | l|l|l|} 
\hline (142 )& + &142 & = & \mathrm { NA } &+& \mathrm { NA } & \mathrm { NA }&-& \mathrm { NA } &=& \mathrm { NA } \ 
\hline
\end{array}$$. 
B)  $$\begin{array} {| l| l | l | l | l | l | l | l | l |l|l|l| } 
\hline 142 &+&( 142)&= & \mathrm { NA } &+& \mathrm { NA } & \mathrm { NA } & - & \mathrm { NA } &=& \mathrm { NA }\
\hline
\end{array}$$ 
C)  $$\begin{array} {| l| l | l | l | l | l | l | l | l |l|l|l| } 
\hline 142 &+&\mathrm { NA }&= & \mathrm { NA } &+&(142) & \mathrm { NA } & - & 142 &=& (142) \
\hline
\end{array}$$ 
D)  $$\begin{array} {| l| l | l | l | l | l | l | l | l |l|l|l| } 
\hline 142 &+&( 142)&= & \mathrm { NA } &+& \mathrm { NA } & \mathrm { NA } & - & \mathrm { NA } &=& \mathrm { NA }\
\hline
\end{array}$$ . 
A)  $$\begin{array} { | l | l | l | l | l | l | l | l | l|l|l|} 
\hline (142 )& + &142 & = & \mathrm { NA } &+& \mathrm { NA } & \mathrm { NA }&-& \mathrm { NA } &=& \mathrm { NA } \ 
\hline
\end{array}$$. 
B)  $$\begin{array} {| l| l | l | l | l | l | l | l | l |l|l|l| } 
\hline 142 &+&( 142)&= & \mathrm { NA } &+& \mathrm { NA } & \mathrm { NA } & - & \mathrm { NA } &=& \mathrm { NA }\
\hline
\end{array}$$ 
C)  $$\begin{array} {| l| l | l | l | l | l | l | l | l |l|l|l| } 
\hline 142 &+&\mathrm { NA }&= & \mathrm { NA } &+&(142) & \mathrm { NA } & - & 142 &=& (142) \
\hline
\end{array}$$ 
D)  $$\begin{array} {| l| l | l | l | l | l | l | l | l |l|l|l| } 
\hline 142 &+&( 142)&= & \mathrm { NA } &+& \mathrm { NA } & \mathrm { NA } & - & \mathrm { NA } &=& \mathrm { NA }\
\hline
\end{array}$$ .

Question 8

Product cost flows are cyclical in that the set of transactions that records the acquisition of raw materials,the conversion of raw materials to finished goods,and the sale of finished goods and related collection of cash occur over and over again.

Accepted Answer

A) True 
 B)False

Question 9

The credit to the Finished Goods Inventory account represents the cost of goods manufactured.

Accepted Answer

A) True 
 B)False

Manufacturing companies use a predetermined overhead rate; such rates are not used by service companies.

The cost of indirect labor will initially be charged to:

Carolina Company placed $26,500 of raw materials into production.The recognition of this event will:

Paying for factory utilities used during the current month is a(n):

During February,Benke Manufacturing Company paid $18,000 in property taxes on one of its factory buildings.This overhead cost should be allocated to units completed during the month it was paid.

Orlando Company placed $142 of raw materials into production.How would this transaction affect the company's financial statements?

Product cost flows are cyclical in that the set of transactions that records the acquisition of raw materials,the conversion of raw materials to finished goods,and the sale of finished goods and related collection of cash occur over and over again.

The credit to the Finished Goods Inventory account represents the cost of goods manufactured.

Management Accounting and Corporate Governance

Cost Behavior, operating Leverage, and Profitability Analysis

Analysis of Cost, volume, and Pricing to Increase Profitability

Cost Accumulation,tracing,and Allocation

Cost Management in an Automated Business Environment: ABC, ABM, and TQM

Relevant Information for Special Decisions

Planning for Profit and Cost Control

Performance Evaluation

Responsibility Accounting

Planning for Capital Investments

Job-Order, process, and Hybrid Costing Systems

Financial Statement Analysis

Statement of Cash Flows

Filters

Exam 11: Product Costing in Service and Manufacturing Entities

Manufacturing companies use a predetermined overhead rate; such rates are not used by service companies.

The cost of indirect labor will initially be charged to:

Carolina Company placed $26,500 of raw materials into production.The recognition of this event will:

Paying for factory utilities used during the current month is a(n):

During February,Benke Manufacturing Company paid $18,000 in property taxes on one of its factory buildings.This overhead cost should be allocated to units completed during the month it was paid.

Orlando Company placed $142 of raw materials into production.How would this transaction affect the company's financial statements?

Product cost flows are cyclical in that the set of transactions that records the acquisition of raw materials,the conversion of raw materials to finished goods,and the sale of finished goods and related collection of cash occur over and over again.

The credit to the Finished Goods Inventory account represents the cost of goods manufactured.

Management Accounting and Corporate Governance

Cost Behavior, operating Leverage, and Profitability Analysis

Analysis of Cost, volume, and Pricing to Increase Profitability

Cost Accumulation,tracing,and Allocation

Cost Management in an Automated Business Environment: ABC, ABM, and TQM

Relevant Information for Special Decisions

Planning for Profit and Cost Control

Performance Evaluation

Responsibility Accounting

Planning for Capital Investments

Job-Order, process, and Hybrid Costing Systems

Financial Statement Analysis

Statement of Cash Flows

Filters