1.EOQ is the order quantity which minimizes a firm's total _____________ costs over its planning horizon

a.Inventory handling

b.Ordering

c.Stock normalization

d.Storage

2.Which of the following is NOT a factory Overhead expense?

a.Machinery lubricants

b.Factory power

c.Carriage on Raw materials

d.Depreciation on loose tools

3.Which of the following cost curves could be graphically represented by a horizontal straight line?

a.TVC and AFC

b.AVC and TFC

c.TFC only

d.AFC only

4.The role of accounting does not normally include the function of _______________

a.Decision making

b.Cash management

c.Product costing

d.Planning and control

5.In producing produce AA, 6300 pounds of direct materials were used at a cost of $1.10 per pound. The standard was 6000 pounds at $1.00 per pound.

Compute the direct materials quantity variance

a.$630 unfavorable

b.$330 unfavorable

c.$600 unfavorable

d.$300 unfavorable

6.Which of the following formulas would enable the determination of cost of goods sold in the manufacturing entity?

a.Cost of goods manufactured- Beginning finished goods inventory- Ending finished goods= Cost of goods sold

b.Beginning work-in-process inventory + cost of goods manufactured +Ending work-in-process= Cost of goods sold

c.Beginning work-in-process inventory+ cost of goods manufactured- Ending work-in-process= Cost of goods sold

d.Cost of goods manufactured+ Beginning finished goods inventory- Ending finished goods inventory= Cost of goods sold

7.An example of a cost NOT associated with holding inventory under and efficient Stock Control System includes ____________ cost

a.Stock out

b.Obsolescence

c.Opportunity

d.Spoilage

8.Which of the following describes the breakeven point?

a.It is the point where total sales equals total fixed costs

b.It is the point where total variable cost equals total fixed cost

c.It is the point where contribution margin equals zero

d.It is the point at which total cost equal total sales

9.Mumba is a small indigenous company that memorabilia basket balls, an item which is very popular with tourist visiting the basketball arena. The leather which goes into the manufacture of these balls would be classified as _______________

1.Variable cost

2.Prime cost

3.Product cost

4.Conversion cost

a.1 and 2 only

b.1,2 and 3 only

c.1,2,3,4

d.1 only

10.Kay Kay Inc. establishes the following direct labor cost for one unit of product (D).

Standard hours1.5 hours

Standard rate$20 per hour

Standard cost$30 (1.5 hours @ $20 per hour)

During the month of June $20,000 direct labor hours were worked and 12,500 units of product (D) were manufactured. Total wages related to direct labor in June were $405,000

What was the direct labor rate variance for June?

a.$30,000 Unfavorable

b.$5000 favorable

c.$5000 Unfavorable

d.$30,000 favorable

11.Which of the following cost must be expensed under IAS2?

a.Cost of purchase that are paid to the suppliers of raw materials

b.Variable production overheads that are allocated to each unit based on the actual usage

c.Selling and distribution overheads incurred in the ordinary course of business

d.Import duties on the cost of raw materials that are paid to the authorities

12.What is the correct journal entry under job order costing to dispose of an underapplied manufacturing overhead balance to the cost of goods sold account?

a.Manufacturing overhead (debit), Cost of goods sold (credit)

b.Cost of goods (debit), Work in progress (Credit)

c.Cost of goods (debit), Manufacturing overhead (Credit)

d.Manufacturing overhead (debit), Work in progress (Credit)

13.Caribbean Company sold 100,000 gizoms at $12 each. Fixed Cost were $300,000 and net income was $200,000. What should have been reported as a variable expense in the CVP income statement?

a.$1,000,000

b.$700,000

c.$900,000

d.$500,000

14.A company is selling a product called creamy pops for $5. The fixed costs for the manufactured company are $30,000, with variable cost $2 per unit. How many units should the company produce to break even?

a.6000

b.10,000

c.15,000

d.30,000

15.Lewis Co. has fixed of $150,000 and variable cost of $9 per unit. If sales price per unit is $12, what is the break-even sales in dollars?

a.$200,000

b.$600,000

c.$480,000

d.$450,000

16.In a job order costing system, raw material is assignment to a job when the materials are ______________.

a.Received from the materials vendor

b.Sold

c.Purchased

d.Issued by the materials stockroom

17.In producing product ZZ, 14,800 direct labor hours were used at a rate of $8.20 per hour. The standard was 15,000 hours at $8.00 per hour, based on these data, the direct labor ____________

a.Efficiency variance of $3000 is favorable

b.Rate variance is $1600 favorable

c.Rate variance $2960 Unfavorable

d.Efficiency variance is $1600 Unfavorable

18.Direct materials used$120,000Beginning work in progress $20,000

Direct labor$100,000Ending work in progress$10,000

Manufacturing overhead $150,000Beginning finished goods$25,000

Selling Expenses$50,000Ending finished goods$15,000

What is the conversion cost?

a.$395,000

b.$370,000

c.$425,000

d.$250.000

19.Kello Inc. used a job order costing system. The following information pertains to the current period:

Estimate manufacturing overheads cost at the beginning of the year $100,000

Estimated direct labor hours at beginning of the year 10,000 hours

Actual manufacturing overheads cost incurred during the year $118,000

Actual direct labor hours worked during the year 11,000 hours

Based on the above information, which of the following is a correct result?

a.Overapplied overhead $8000

b.Underapplied overhead $8000

c.Underapplied overhead $18,000

d.Overapplied overhead $18,000

20.On the cash budget, net cash flow can be calculated as _____________

a.All cash inflows less all cash outflows

b.Opening cash balance plus all cash inflows

c.All cash inflows plus all cash outflows

d.Profit less all expense

21.Fixed production overheads are those_____________

a.Indirect cost of production that remains constant regardless of the volume of production

b.Directs cost attributable to the product or service vary regardless of the volume of production

c.Indirect cost of production that vary directly with the volume of production

d.Direct costs attribution to the production or service that remain constant regardless of volume production

22.A firm is expected to have direct materials purchased of $70,000 in the first quarter and $90,000 in the second quarter. 40% of the purchased will be paid for in cash as they occur, and the balance will be paid in the following quarter. Compute the budgeted cash payment for purchases in the second quarter.

a.$78,000

b.$54,000

c.$28,000

d.$72,000