Professional Documents
Culture Documents
1) Financial accounting provides a histo ri cal perspective, whereas management accounting emphasizes:
fA). the futu re
't!) past transachons
C) a current perspective
0) reports to shareholders
3) All of the foll owing are true EXCEPT that indirect costs:
A) may be included in prime costs
B) are not easi ly traced to products or services
C) vary with the selectio n of the cost object
0) may be included in manufacturing overhead
A) a fixed cost
B) a cost with fixed and variable elements
C) a variable cost
0) al ways an indirect cost
A) gross margin
B) products costs and period costs
C) di fferent product lines
0) va riable and fi xed costs
7) Fixed costs equal $12,000, unit contribution margin equals $20, and the number of units sold equal 1,600.
Operating income is:
A) $12,000
B) $20,000
C) $32,000
0 ) $40,000
8) If selling price per unit is $30, va ri able costs per unit are $20, total fixed costs are 510,000, the tax rate is 30%,
and the company sells 5,000 units, net income is:
A) 512,000
B) $14,000
C) $28,000
D) $40,000
9) Fixed costs remain constant at $200,000 per month. During high-output months variable costs are 5160,000,
and during low-output monU,s variable costs are $40,000. What are the respective high and low indirect-cost
rates if budgeted professional labor- hours are 8, 000 for hi gh-outp ut months and 2,000 for low-output
months?
A) $45.00 per hour; $120.00 per hour
B) $45.00 per hour; $45.00 per hour
C) $25.00 per hour; $20.00 per hour
D) 556.20 per hour; $120 .00 per hour
10) What is the appropriate journal entry if $100,000 of materials were purchased on account for the month of
August?
A) Materials Control 100,000
Accounts Payable Control 100,000
B) Work-in-Process Control 100,000
Accounts Paya ble Control 100,000
C) Manufacturing Overhead Control 100,000
Accounts Receivable Control 100,000
D) Manufacturing Allocated 100,000
Accounts Receivable Control 100,000
11) Manufacturing overhead costs incurred for the month are:
Utilities $15,000
Depreciation on equipment $25,000
Repairs $10,000
Which is the correct journal entry assuming utilities and repairs were on account?
A) Manufac turing Overhead Control 50,000
Accounts Payable Control 25,000
Accumulated DepreCiation Control 25,000
B) Manufacturing Ove rhead Control 50,000
Accounts Payable Control 50,000
C) Manufacturing Overhead Control 50,000
Accumulated Depreciation Con trol 50,000
D) Accumulated DepreCiation Control 25,000
Accounts Paya bl e Control 25,000
Manufacturing Overhead Control 50,000
A
12) It is advantageous to coord inate budgets with:
A) suppliers
B) customers
C) the marketing and production departments
0) All of these answers are correct
14) To gain the benefits of budgeting _ ___ must understand and support the budget
A) management at all levels
B) customers
C) suppliers
0) AU of these answers are correct
1l6) For January, the cost components of a picture frame include $0.35 for the glass, $.65 for the wooden
frame, and $0.80 for assembly. The assembly desk and tools cost $400. 1,000 frames are expected to be
produced in the coming year. What cost function best represents these costs?
A) Y = 1.80 + 400X
B) Y = 400 + 1.S0X
C) Y = 2.20 + 1,000X
0) Y = 1.00 + 400X
17) The cost components of an ai r conditioner include $35 fo r the compressor, $11.50 for the sheet molded
compound frame, and $80 per unit fo r assembly. The factory machines and tools cost is $55,000. The
company expects to produce 1,500 air conditioners in the coming year. What cost function best represents
these costs?
A) y = 1500 + 126.5X
B) Y = 1,500 +55,000X
C) y = 55,000 + 1,500X
0)Y= 55,000 + 126.50X
20) Gathering cost information through observations and interviews from departments within an organization is
knmvn as the:
A) account analysis method
B) conference method
C) industrial engineering method
0) quantitative ana lysis method
21) Each department is regarded as a distinct accounting entity when interdepartmental transfers are present in
an organjzation.
22) Hybrid costing systems are developed to cost products that are produced in a stand ardized em~ronment,
but which are often customized to meet the needs of some of its customers.
23) An operation-costing sys tem uses work orders that specify needed direct materials and step-by-step
operations.
24) Costing systems that are used for the costing of like or similar units of products in mass production are
called:
A) inventory-costing systems
B) job-costing systems
C) process-costing systems
0) weighted-average costing systems
25) Which of the following manufactured products would not use process costing?
A) 767 jet aircraft
B) 19-inch televi sion sets
C) Custom built houses
0) Both A and C are correct.