Question 1

Differentiate between:
a) direct materials versus indirect materials
b) direct labor versus indirect labor

Accepted Answer

a) Direct materials must become a physic...

Question 2

A plant manager's salary may be referred to as:

Accepted Answer

A)   either a direct cost or an indirect cost since managerial accounting is not restricted by GAAP
B)   a direct cost
C)   an indirect cost
D)   a period costE) B) and C)
F) A) and C)

Question 3

The cost of a manufactured product generally consists of which of the following costs?

Accepted Answer

A)   Direct materials cost and factory overhead cost
B)   Direct labor cost and factory overhead cost
C)   Direct labor cost, direct materials cost, and factory overhead cost
D)   Direct materials cost and direct labor costE) All of the above
F) None of the above

Question 4

Indirect costs can be specifically identified to a cost object.

Accepted Answer

A) True 
 B)False

Question 5

What term is used to describe the process of monitoring operating results and comparing actual results with the expected results?

Accepted Answer

A)   Improving
B)   Controlling
C)   Directing
D)   PlanningE) All of the above
F) B) and C)

Question 6

Goods that are partway through the manufacturing process, but not yet complete, are referred to as materials inventory.

Accepted Answer

A) True 
 B)False

Question 7

In order to be useful to managers, management accounting reports should possess all of the following characteristics EXCEPT:

Accepted Answer

A)   provide objective measures of past operations and subjective estimates about future decisions
B)   be prepared in accordance with generally accepted accounting principles
C)   be provided at any time management needs information
D)   be prepared to report information for any unit of the business to support decision makingE) B) and D)
F) B) and C)

Question 8

Costs on the income statement for both a merchandiser and a manufacturer would include:

Accepted Answer

A)   operating expenses
B)   direct materials
C)   direct labor incurred
D)   cost of goods manufacturedE) None of the above
F) B) and D)

Question 9

The Zoe Corporation has the following information for the month March. Determine the (a) cost of goods manufactured, and (b) cost of goods sold.

Accepted Answer

(a)

_TB20...

Question 10

Identify the following costs as (a) prime cost, (b) conversion cost, (c) or both for a cake factory.
1. _____ Frosting
2. _____ Wages of the baker
3. _____ Sprinkles for the topping (considered an indirect material)
4. _____ Depreciation on oven

Accepted Answer

The answer of Identify the following costs as (a) prime...

Question 11

Identify the following costs as (a) direct materials, (b) direct labor, or (c) factory overhead for a cake manufacturer.
1. _____ Frosting
2. _____ Depreciation on oven
3. _____ Wages of bakers
4. _____ Sprinkles for topping

Accepted Answer

1. Direct material
2...

Question 12

Indirect labor and indirect materials are classified as:

Accepted Answer

A)   factory overhead and product costs
B)   factory overhead and period costs
C)   operating costs and period costs
D)   operating costs and product costsE) None of the above
F) C) and D)

Question 13

The vice presidents of production and sales and the controller hold line positions in most large organizations.

Accepted Answer

A) True 
 B)False

Question 14

Work in process inventory on December 31, 2011, is $42,000. Work in process inventory decreased by 40% during 2011. Total manufacturing costs incurred in 2011 amount to $260,000. What is cost of goods manufactured?

Accepted Answer

A)   $232,000
B)   $302,000
C)   $288,000
D)   $190,000E) All of the above
F) B) and C)

Question 15

Which of the following costs are referred to as conversion costs?

Accepted Answer

A)   Direct labor cost and factory overhead cost
B)   Direct materials cost and direct labor cost
C)   Factory overhead cost
D)   Direct materials cost and factory overhead costE) B) and D)
F) B) and C)

Question 16

A cost object indicates how costs are related or identified.

Accepted Answer

A) True 
 B)False

Question 17

Which of the following is considered a part of factory overhead cost?

Accepted Answer

A)   Sales commissions
B)   Depreciation of factory buildings
C)   Depreciation of office equipment
D)   Direct materials usedE) A) and B)
F) A) and C)

Question 18

On the balance sheet for a manufacturing business, the cost of direct materials, direct labor, and factory overhead are categorized as either materials inventory, work in process inventory, or finished goods inventory.

Accepted Answer

A) True 
 B)False

Question 19

For an automotive repair shop, the wages of mechanics would be classified as direct labor cost.

Accepted Answer

A) True 
 B)False

Question 20

Costs other than direct materials cost and direct labor cost incurred in the manufacturing process are classified as factory overhead cost.

Accepted Answer

A) True 
 B)False

Exam 18: Managerial Accounting Concepts and Principles

Which of the following costs are referred to as conversion costs?

Correct AnswerverifiedShow Answer

A cost object indicates how costs are related or identified.

Correct AnswerverifiedShow Answer

The vice presidents of production and sales and the controller hold line positions in most large organizations.

Correct AnswerverifiedShow Answer

In order to be useful to managers, management accounting reports should possess all of the following characteristics EXCEPT:

Correct AnswerverifiedShow Answer

For an automotive repair shop, the wages of mechanics would be classified as direct labor cost.

Correct AnswerverifiedShow Answer

Identify the following costs as (a) prime cost, (b) conversion cost, (c) or both for a cake factory. 1. _____ Frosting 2. _____ Wages of the baker 3. _____ Sprinkles for the topping (considered an indirect material) 4. _____ Depreciation on oven

Correct AnswerverifiedShow Answer

The Zoe Corporation has the following information for the month March. Determine the (a) cost of goods manufactured, and (b) cost of goods sold.

Correct Answerverified(a) _TB20...View AnswerShow Answer

Goods that are partway through the manufacturing process, but not yet complete, are referred to as materials inventory.

Correct AnswerverifiedShow Answer

Indirect labor and indirect materials are classified as:

Correct AnswerverifiedShow Answer

On the balance sheet for a manufacturing business, the cost of direct materials, direct labor, and factory overhead are categorized as either materials inventory, work in process inventory, or finished goods inventory.

Correct AnswerverifiedShow Answer

Costs on the income statement for both a merchandiser and a manufacturer would include:

Correct AnswerverifiedShow Answer

The cost of a manufactured product generally consists of which of the following costs?

Correct AnswerverifiedShow Answer

Costs other than direct materials cost and direct labor cost incurred in the manufacturing process are classified as factory overhead cost.

Correct AnswerverifiedShow Answer

Differentiate between: a) direct materials versus indirect materials b) direct labor versus indirect labor

Correct Answerverifieda) Direct materials must become a physic...View AnswerShow Answer

A plant manager's salary may be referred to as:

Correct AnswerverifiedShow Answer

Which of the following is considered a part of factory overhead cost?

Correct AnswerverifiedShow Answer

Work in process inventory on December 31, 2011, is $42,000. Work in process inventory decreased by 40% during 2011. Total manufacturing costs incurred in 2011 amount to $260,000. What is cost of goods manufactured?

Correct AnswerverifiedShow Answer

Indirect costs can be specifically identified to a cost object.

Correct AnswerverifiedShow Answer

Identify the following costs as (a) direct materials, (b) direct labor, or (c) factory overhead for a cake manufacturer. 1. _____ Frosting 2. _____ Depreciation on oven 3. _____ Wages of bakers 4. _____ Sprinkles for topping

Correct Answerverified1. Direct material2...View AnswerShow Answer

What term is used to describe the process of monitoring operating results and comparing actual results with the expected results?

Correct AnswerverifiedShow Answer

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Identify the following costs as (a) prime cost, (b) conversion cost, (c) or both for a cake factory. 1. ___ Frosting 2. _ Wages of the baker 3. _ Sprinkles for the topping (considered an indirect material) 4. ___ Depreciation on oven

Correct Answer
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Correct Answer
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(a)
_TB20...
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a) Direct materials must become a physic...
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Identify the following costs as (a) direct materials, (b) direct labor, or (c) factory overhead for a cake manufacturer. 1. ___ Frosting 2. _ Depreciation on oven 3. _ Wages of bakers 4. ___ Sprinkles for topping

Correct Answer
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1. Direct material
2...
View Answer

Correct Answer
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