Multiple-Choice Questions

1. Manufactured inventory that has begun the production process but is not yet completed is A. work in process B. raw materials C. merchandise inventory D. finished goods

2. Company XYZ just finished production on 200 units of in-process inventory. Which of the following best describes the journal entry to account for this completion. A. Debit Finished Goods & Credit Work in Progress B. Credit Finished Goods & Debit Work in Progress C. Debit Finished Goods & Credit Raw Materials D. Credit Finished Goods & Debit Raw Materials E. None of the Above

3. Which of the following is not a principle of the management accounting system? A. Making and Supporting Decisions B. Evaluating and Rewarding Performance C. Providing the Financial Position of the Company D. Assigning Decision Making Authority E. All of the Above

4. Which of the following is correct regarding the flow of costs for a manufacturer? A. Inventories move from Raw Materials to Work in Process to Finished Goods B. Work in Process Inventory Costs Incorporate Direct Labor C. Finished Goods Inventory Costs Incorporate Manufacturing Overhead D. All of the Above E. None of the Above

5. Which of the following is correct regarding the differences between Direct Labor and Indirect Labor? A. Manufacturing Overhead includes Direct Labor but not Indirect Labor B. Indirect Labor includes costs of employees that do not work directly on the manufactured goods C. Direct Labor includes costs of employees that work directly on the manufactured goods D. Both A & B E. Both B & C