1. ABC generally causes the least amount of cost distortion among products because indirect costs are allocated to the products based on

types of activities used by the product.

the extent to which the activities are used.

both A and B.

none of the above.

2.

Chicago Steel's operating activities for the year are listed below:

Beginning inventory	$1,000,800
Ending inventory	$350,500
Purchases	$750,300
Sales revenue	$1,500,400
Operating expenses	$700,200

What is the cost of goods sold for the year?

$1,751,100

$1,400,600

$750,100

$50,100

3.

The following is selected financial data from Turtle Bay Manufacturing for the most recent year:

Ending raw materials inventory	$21,200
Ending work in process inventory	$44,900
Ending finished goods inventory	$53,200
Amount of underallocated manufacturing overhead	$5,100
Cost of goods sold for year	$85,500
Cost of raw materials purchased during year	$45,700
Cost of direct materials requisitioned during year	$44,300
Cost of indirect materials requisitioned during year	$7,200
Cost of goods completed during year	$120,200
Manufacturing overhead allocated	$60,400
Manufacturing overhead % of direct labor cost	135%

What is the beginning raw materials inventory?

$27,000

$51,500

$19,800

$5,800

4. Which of the following is not an activity in an ABC system that determines the cost of a manufactured product?

Materials handling

Inspecting

Machining

Accounting

5. Which type of company utilizes managerial accounting?

Manufacturers

Service

Retailers

All of the above

6. On a traditional income statement, all manufacturing-related costs, whether fixed or variable, are listed

above the gross profit line.

below the operating income line.

above the sales line.

above the contribution margin line.

7. In a process costing system, direct labor and manufacturing overhead are normally

incurred evenly throughout the process.

incurred at the end of the process.

incurred in full at the beginning of the process.

not recorded.

8. Manufacturing overhead costs for a product include

operating expenses.

indirect manufacturing costs.

direct material.

prime costs.

9.

Here are selected basic data for Wilson Company:

Estimated manufacturing overhead	$243,750		Factory utilities	$30,900
Estimated labor hours	35,000		Indirect labor	$22,600
Actual direct labor hours	36,000		Sales commissions	$54,600
Estimated direct labor cost	$325,000		Factory rent	$47,800
Actual direct labor cost	$320,000		Factory property taxes	$28,700
Factory depreciation	$65,600		Indirect materials	$33,300

If the company allocates overhead based on direct labor cost, what are the total actual manufacturing overhead costs?

$173,000

$283,500

$228,900

$260,900

10. ERP stands for

	Enterprise Resource Planning.
	Enclosed Resource Placement.
	Edwin R. Perry, the man that created the first system.
	Entity Replacement Product.