l. Cloudy Comfort Company's accounting records reflect the following inventories: Dec. 31, 2011 Dec. 31, 2012 Raw materials inventory $310,000 $260,000 300,000 Work in process inventory 160,000 Finished goods inventory 190,000 150,000 During 2012, $400,000 of raw materials were purchased, direct labor costs amounted to $500,000, and manufacturing overhead incurred was $480,000 If Cloudy Comfort Company's cost of goods manufactured for 2012 amounted to $1,190,000, its cost of goods sold for the year is A) $1,300,000 B) $1,050,000 C) $1,150,000. D) $1,230,000 2. Managerial accounting is applicable to A) service entities. B manufacturing entities. C) not-for-profit entities. D) all of these. 3. Which one of the following is not a direct material? A) A tire used for a lawn mower B) Plastic used in the covered case for a home PC C) Steel used in the manufacturing of steel-radial tires D) Lubricant for a ball-bearing joint for a large crane 4. Managerial accounting information is generally prepared for A) stockholders. B) creditors. C) managers. D regulatory agencies 5. A manufacturing process requires small amounts of glue. The glue used in the production process is classified as a A) period cost. B) indirect material. C) direct material D) miscellaneous expense