Question 1

Which of the following equations is correct?

Accepted Answer

A) Total Manufacturing Costs = Direct Materials + Direct Labor + Selling Costs 
B) Total Manufacturing Costs = Direct Materials + Direct Labor + Overhead 
C) Total Manufacturing Costs = Direct Labor + Overhead + Selling Costs + Administrative Costs 
D) Total Manufacturing Costs = Product Costs + Period Costs 
A) Total Manufacturing Costs = Direct Materials + Direct Labor + Selling Costs 
B) Total Manufacturing Costs = Direct Materials + Direct Labor + Overhead 
C) Total Manufacturing Costs = Direct Labor + Overhead + Selling Costs + Administrative Costs 
D) Total Manufacturing Costs = Product Costs + Period Costs

Question 2

Overhead costs can be directly traced to products once the products are completed.

Accepted Answer

A) True 
 B)False

Question 3

Period costs are

Accepted Answer

A) charged against the revenue of the current period. 
B) initially recognized on the balance sheet as inventory. 
C) charged to the period in which the product generates revenue. 
D) further classified as direct costs and indirect costs. 
A) charged against the revenue of the current period. 
B) initially recognized on the balance sheet as inventory. 
C) charged to the period in which the product generates revenue. 
D) further classified as direct costs and indirect costs.

Question 4

Management accounting accumulates,maintains,and processes an organization's financial and nonfinancial information.

Accepted Answer

A) True 
 B)False

Question 5

The product costs that appear in the financial statements are estimated product costs.

Accepted Answer

A) True 
 B)False

Question 6

Non-value-adding costs increase the cost of a product.

Accepted Answer

A) True 
 B)False

Question 7

Lubrication used for machines is an example of a direct material.

Accepted Answer

A) True 
 B)False

Question 8

Product unit cost is the sum of direct materials,direct labor,and overhead divided by the total number of units produced.

Accepted Answer

A) True 
 B)False

Question 9

A business plan is a comprehensive statement of how a company will achieve its objectives.

Accepted Answer

A) True 
 B)False

Question 10

Yamishi Production had the following inventories for the first quarter of 2014:
  Purchases of materials during the quarter were $427,800.Total direct labor costs were incurred in the amount of $1,482,000.Actual overhead costs were incurred as follows: operating supplies used,$17,100;janitorial and maintenance,$87,300;employee benefits,$26,400;utilities,$162,000;depreciation of factory,$43,200;property taxes,$24,000;factory insurance,$29,000.Net sales for the quarter were $3,562,200.Selling and administrative expenses were $508,000.Income taxes should be computed at 40 percent.
Prepare a statement of cost of goods manufactured for the first quarter of 2014.

Accepted Answer

The answer of Yamishi Production had the following inventories for...

Question 11

Total manufacturing costs decrease the balance of the Work in Process Inventory account.

Accepted Answer

A) True 
 B)False

Question 12

Neither the amount of detail nor the format of a management accounting report is affected by those to whom the report is sent.

Accepted Answer

A) True 
 B)False

Question 13

The changes in the balance of Work in Process Inventory and the total manufacturing costs for a period are used to compute cost of goods manufactured.

Accepted Answer

A) True 
 B)False

Question 14

A job order cost card can be used to record all product costs incurred during production.

Accepted Answer

A) True 
 B)False

Question 15

Management accounting exists primarily for the benefit of people inside a company.

Accepted Answer

A) True 
 B)False

Question 16

Period costs are also called noninventoriable costs.

Accepted Answer

A) True 
 B)False

Question 17

Direct labor cannot be traced to products as it is invisible.

Accepted Answer

A) True 
 B)False

Question 18

Managerial accounting primarily provides information on past performance.

Accepted Answer

A) True 
 B)False

Question 19

Management accounting is a subordinate activity to financial accounting.

Accepted Answer

A) True 
 B)False

Question 20

Reporting format of managerial accounting is flexible and driven by user's needs.

Accepted Answer

A) True 
 B)False

Exam 17: Managerial Accounting and Cost Concepts

Which of the following equations is correct?

Overhead costs can be directly traced to products once the products are completed.

Period costs are

Management accounting accumulates,maintains,and processes an organization's financial and nonfinancial information.

The product costs that appear in the financial statements are estimated product costs.

Non-value-adding costs increase the cost of a product.

Lubrication used for machines is an example of a direct material.

Product unit cost is the sum of direct materials,direct labor,and overhead divided by the total number of units produced.

A business plan is a comprehensive statement of how a company will achieve its objectives.

Total manufacturing costs decrease the balance of the Work in Process Inventory account.

Neither the amount of detail nor the format of a management accounting report is affected by those to whom the report is sent.

The changes in the balance of Work in Process Inventory and the total manufacturing costs for a period are used to compute cost of goods manufactured.

A job order cost card can be used to record all product costs incurred during production.

Management accounting exists primarily for the benefit of people inside a company.

Period costs are also called noninventoriable costs.

Direct labor cannot be traced to products as it is invisible.

Managerial accounting primarily provides information on past performance.

Management accounting is a subordinate activity to financial accounting.

Reporting format of managerial accounting is flexible and driven by user's needs.

Accounting Principles and the Financial Statements

Analyzing and Recording Business Transactions

Adjusting the Accounts

Completing the Accounting Cycle

Foundations of Financial Reporting and the Classified Balance Sheet

Accounting for Merchandising Operations

Inventories

Cash and Internal Control

Receivables

Long -Term Assets

Current Liabilities and Fair Value Accounting

Accounting for Partnerships

Accounting for Corporations

Long Term Liabilities

The Statement of Cash Flows

Financial Statement Analysis

Costing Systems: Job Order Costing

Costing Systems Process Costing

Value-Based Systems: Activity-Based Costing and Lean Accounting

Cost-Volume-Profit Analysis

The Budgeting Process

Flexible Budgets and Performance Analysis

Standard Costing and Variance Analysis

Short-Run Decision Analysis and Capital Budgeting

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