QUESTION 1

Managerial Accounting focuses primarily on providing data primarily for

	internal use and decision making by managers.
	preparation of tax returns for the IRS.
	preparation of financial reports in accordance with GAAP to maintain uniformity.
	providing standardization of financial data for SEC 10Ks.
	c and d.

QUESTION 2

Which of these categories is not a managerial accounting cost of production?

	Direct Materials
	Direct Labor
	Capital
	Manufacturing Overhead
	All are major product cost components for Managerial Accounting.

QUESTION 3

Raw Materials, Work in Process, and Finished Goods are all examples of

	income statement accounts
	expense accounts
	inventory accounts
	all of the above

QUESTION 4

All of the following are product costs for a computer manufacturer, except

	the hard plastic casing of the computer.
	the salary of the company president.
	the wages of the employees who assemble the computers.
	the manufacturing overhead in the assembly plant.
	all are product costs.

QUESTION 5

Which of the following accounts is debited when direct labor is recorded?

	Work in process
	Salaries and wages expense
	Salaries and wages payable
	Manfacturing overhead

QUESTION 6

The Work in Progress account accumulates the following product costs:

	Direct materials
	Direct labor
	Manufacturing overhead (applied)
	All of the above

QUESTION 7

Beginning Raw Materials Inventory = $5 Purchases of Raw Materials during the period was $3. Ending Raw Materials Inventory was $1. What was the amount of Raw Materials used/requisitioned during the period?

	$1
	$3
	$7
	$8

QUESTION 8

Sales = $10/unit. Selling and admin costs = $100 fixed plus $1/unit variable cost. Cost of Goods is a variable cost of $2/unit. 20 units are sold. In a traditional income statement, what is Gross Margin?

	$200
	$140
	$160
	$40

QUESTION 9

Sales = $10/unit. Selling and admin costs = $100 fixed plus $1/unit variable cost. Cost of Goods is a variable cost of $2/unit. 20 units are sold. In a variable or contribution margin income statement, what is Contribution Margin?

	$200
	$140
	$160
	$40

QUESTION 10

Sales = $500 Sales price per unit is $25 Variable Admin Expenses = $3/unit Fixed Admin Expenses = $250 Cost of Goods Sold = $4/unit (all variable) What is net operating income for either the variable/contribution margin or traditional income statement? Same NOI for each.

	$420
	$360
	$310
	$110

QUESTION 11

The contribution margin shows how much is available for the company to contribute to

	cover fixed expenses
	provide a net operating income
	your personal 401K plan
	a and b
	all of the above

QUESTION 12

The following data pertains to activity and electricity costs for a greenhouse for two recent years.

	Year 2	Year 1
Activity level in units of plants grown	10,000	6,000
Electricity costs	$12,000	$9,000

Using the high-low method, the cost formula for electricity is:

	$1.50 per unit
	$1.20 per unit
	$3,000 fixed plus $3.00 per unit
	$4,500 fixed plus $0.75 per unit

QUESTION 13

In regression analysis, when the cost line generated extends to meet the vertical y-axis, it will cross the y-axis at

	$0 fixed costs
	the dollar amount of fixed costs
	the dollar amount of variable costs
	the sales volume
	the variable cost per unit

QUESTION 14

Manufacturing overhead costs and machine hours used for the accounting period were:

$36,000 for 1000 machine hours $34,000 for 940 machine hours $30,000 for 830 machine hours

What is the variable cost per unit using the high low method?

	$35.29
	$36.00
	$36.14
	$36.17
	Cannot be determined/something is wrong.

QUESTION 15

The variable cost per unit for a manufacturer was $7.00, representing $7.00 of variable cost per hour of operation. At the low end of the activity level was 400 hours for a total cost of $6200. What is the fixed cost for the manufacturer if the high low method is used?

	$108.50
	$885.71
	$2800.00
	$3400.00
	Cannot be determined/something is wrong.

QUESTION 16

The cost formula using high low analysis was determined to be y = $26x + $18,500. If 100 units are sold at a cost of $10 each, what is the total cost estimated to be using the high low method?

	$11,100
	$18,760
	$21,100
	$44,500
	Cannot be determined/something is wrong.

QUESTION 17

The LMN Company had a high level of activity of 1000 kilowatts and a low level activity of 500 kilowatts. Total costs at the high level of activity were $40,000. Total costs at the low level of activity were $38,000. The high low method was used to determine the dollar per kilowatt variable rate was $25/kilowatt. What is the fixed cost for LMN, using the high low method?

	$15,000
	$21,750
	$36,750
	$51,750
	Cannot be determined/something is wrong.

QUESTION 18

At a variable cost per unit of $2, a total cost of $105, and a low activity level of 53, determine fixed cost using the high low method.

	1
	$106
	$211
	it equals NOI
	Cannot be determined/something is wrong.

QUESTION 19

Use the following data to calculate Cost of Goods Manufactured. Cost of Goods Sold is adjusted by Overapplied or Underapplied at period end, as was done in MBA 840.

Direct Materials: $38,000
Direct Labor: 24,000
Manufacturing Overhead (applied): $17,000
Beginning Work in Procress: $10,000
Ending Work in Process: $11,000

The Cost of Goods Manufactured was

	$89,000
	$78,000
	$79,000
	$80,000
	none of the above.

QUESTION 20

During the month of February, the cost of goods manufactured was $93,000. Beginning Finished Goods inventory was $44,000 and Ending Finished Goods inventory was $46,000. What was the Cost of Goods Sold for February? Ignore underapplied or overapplied manufacturing overhead adjustments.

	$89,000
	$91,000
	$95,000
	$97,000
	None of the above.

QUESTION 21

Manufacturing overhead is estimated to be $1000 for the period. Direct labor hours are estimated to be 250. Machine hours are estimated to be 450. Manufacturing overhead is applied based on Direct labor hours. What is the applied manufacturing overhead rate for the period?

	$1000
	$250
	$2.22
	$2.50
	$4.00

QUESTION 22

Manufacturing overhead is estimated to be $1200 for the period. Direct labor hours are estimated to be 300 and manufacturing overhead is applied based on Direct labor hours. The actual Direct labor hours that were worked during the period were 305. What is applied manufacturing overhead?

	$4
	$20
	$1200
	$1220
	None of the above.

QUESTION 23

Manufacturing overhead is estimated to be $1200 for the period. Direct labor hours are estimated to be 300 and manufacturing overhead is applied based on Direct labor hours. The actual Direct labor hours that were worked during the period were 305. Actual manufacturing overhead for the period came in at $1230. Is manufacturing overhead overapplied or underapplied and by how much?

	Overapplied by $10
	Overapplied by $20
	Underapplied by $10
	Underapplied by $20
	Underapplied by $30

QUESTION 24

QRS Co adjusts Cost of Goods sold by overapplied or underapplied manufacturing overhead at period end, as was done in MBA840. Beginning WIP is $60. Materials requisitioned and put into production were $10. Applied manufacturing over was $15. Actual manufacturing overhead was $12. WIP transferred to Finished Goods was $20. Ending WIP was $100. What was the Direct Labor for the period?

	$23
	$35
	$47
	$103
	None of the above.

QUESTION 25

If overapplied or underapplied overhead is consistently a large amount relative to actual overhead, management should look at

	an interesting YouTube
	estimated overhead for the year
	the ocst driver or allocation base used
	both b and c
	both b and c and also period expenses

QUESTION 26

Direct Materials are $180; Direct Labor is $300; Manufacturing Overhead is applied based on direct labor costs. The predetermined overhead rate is 60%. Production and sales volume = 10 products. What is the cost of one product?

	$29.80
	$36.00
	$45.00
	$66.00
	None of the above.

QUESTION 27

The High Low Method and Regression Analysis help break out product costs from period costs.

True

False

QUESTION 28

Job-Order costing would be a logical system for a company making large yachts while Process Costing would work well for a company that makes toothpaste.

True

False

QUESTION 29

The Work in Process account accumulates production costs.

True

False

QUESTION 30

Sales = $200, Cost of Goods Sold = $120. Gross Margin is $80

True

False

QUESTION 31

Sales = $300, Gross Margin = $200, All expenses = $75. Net Operating Income = $25

True

False

QUESTION 32

Overapplied overhead means credits exceed debits in the Manufacturing Overhead account,

True

False

QUESTION 33

The entry to adjust Cost of Goods Sold for underapplied overhead debits Cost of Goods Sold.

True

False

QUESTION 34

The entry to adjust Cost of Goods Sold for overapplied overhead increases Cost of Goods Sold.

True

False

QUESTION 35

When cleaning supplies are used within the manufacturing factory, the journal entry is to debit manufacturing overhead.

True

False

QUESTION 36

An example of indirect labor is a quality inspector that is assigned throughout the manufacturing plant.

True

False

QUESTION 37

A predetermined overhead rate used to apply overhead is acceptable even though it calculates an estimate. That is because this method allows a more timely costing of the product even if some accuracy in cost is sacrificed.

True

False

QUESTION 38

Advertising paid to promote the product is a product cost.

True

False

QUESTION 39

When completed products are transferred out of WIP and into Finished Goods, the amount shown in the transaction is the Cost of Goods Manufactured (ignoring overapplied or underapplied overhead).

True

False

QUESTION 40

You have applied yourself, and perhaps even overapplied yourself so far in this course. You are Finished. Good. (Hint: the answer rhymes with through).

True

False

1. QUESTION 1 Managerial Accounting focuses primarily on providing data primarily for internal use and decision making by managers. preparation of tax returns for the IRS. preparation of financial reports in accordance with GAAP to maintain uniformity. providing standardization of financial data for SEC 10Ks. c and d. 1. QUESTION 2 Which of these categories is not a managerial accounting cost of production? Direct Materials Direct Labor Capital Manufacturing Overhead All are major product cost components for Managerial Accounting. 1. QUESTION 3 Raw Materials, Work in Process, and Finished Goods are all examples of income statement accounts expense accounts inventory accounts all of the above 1. QUESTION 4 All of the following are product costs for a computer manufacturer, except the hard plastic casing of the computer. the salary of the company president. the wages of the employees who assemble the computers. the manufacturing overhead in the assembly plant. all are product costs. 1. QUESTION 5 Which of the following accounts is debited when direct labor is recorded? Work in process Salaries and wages expense Salaries and wages payable Manfacturing overhead 1. QUESTION 6 The Work in Progress account accumulates the following product costs: Direct materials Direct labor Manufacturing overhead (applied) All of the above 1. QUESTION 7 Beginning Raw Materials Inventory = $5 Purchases of Raw Materials during the period was $3. Ending Raw Materials Inventory was $1. What was the amount of Raw Materials used/requisitioned during the period? $ 1 $ 3 $ 7 $ 8 1. QUESTION 8 Sales = $10/unit. Selling and admin costs = $100 fixed plus $1/unit variable cost. Cost of Goods is a variable cost of $2/unit. 20 units are sold. In a traditional income statement, what is Gross Margin? $20 0 $14 0 $16 0 $40 1. QUESTION 9 Sales = $10/unit. Selling and admin costs = $100 fixed plus $1/unit variable cost. Cost of Goods is a variable cost of $2/unit. 20 units are sold. In a variable or contribution margin income statement, what is Contribution Margin? $20 0 $14 0 $16 0 $40 1. QUESTION 10 Sales = $500 Sales price per unit is $25 Variable Admin Expenses = $3/unit Fixed Admin Expenses = $250 Cost of Goods Sold = $4/unit (all variable) What is net operating income for either the variable/contribution margin or traditional income statement? Same NOI for each. $42 0 $36 0 $31 0 $11 0 1. QUESTION 11 The contribution margin shows how much is available for the company to contribute to cover fixed expenses provide a net operating income your personal 401K plan a and b all of the above 1. QUESTION 12 The following data pertains to activity and electricity costs for a greenhouse for two recent years. Year 2 Year 1 Activity level in units of plants grown 10,000 6,000 Electricity costs $12,000 $9,000 2. Using the high-low method, the cost formula for electricity is: $1.50 per unit $1.20 per unit $3,000 fixed plus $3.00 per unit $4,500 fixed plus $0.75 per unit 1. QUESTION 13 In regression analysis, when the cost line generated extends to meet the vertical yaxis, it will cross the y-axis at $0 fixed costs the dollar amount of fixed costs the dollar amount of variable costs the sales volume the variable cost per unit 1. QUESTION 14 Manufacturing overhead costs and machine hours used for the accounting period were: $36,000 for 1000 machine hours $34,000 for 940 machine hours $30,000 for 830 machine hours What is the variable cost per unit using the high low method? $35.29 $36.00 $36.14 $36.17 Cannot be determined/something is wrong. 1. QUESTION 15 The variable cost per unit for a manufacturer was $7.00, representing $7.00 of variable cost per hour of operation. At the low end of the activity level was 400 hours for a total cost of $6200. What is the fixed cost for the manufacturer if the high low method is used? $108.50 $885.71 $2800.00 $3400.00 Cannot be determined/something is wrong. QUESTION 16 1. The cost formula using high low analysis was determined to be y = $26x + $18,500. If 100 units are sold at a cost of $10 each, what is the total cost estimated to be using the high low method? $11,100 $18,760 $21,100 $44,500 Cannot be determined/something is wrong. 1. QUESTION 17 The LMN Company had a high level of activity of 1000 kilowatts and a low level activity of 500 kilowatts. Total costs at the high level of activity were $40,000. Total costs at the low level of activity were $38,000. The high low method was used to determine the dollar per kilowatt variable rate was $25/kilowatt. What is the fixed cost for LMN, using the high low method? $15,000 $21,750 $36,750 $51,750 Cannot be determined/something is wrong. 1. QUESTION 18 At a variable cost per unit of $2, a total cost of $105, and a low activity level of 53, determine fixed cost using the high low method. 1 $106 $211 it equals NOI Cannot be determined/something is wrong. QUESTION 19 1.

Use the following data to calculate Cost of Goods Manufactured. Cost of Goods Sold is adjusted by Overapplied or Underapplied at period end, as was done in MBA 840.

Direct Materials: $38,000
Direct Labor: 24,000
Manufacturing Overhead (applied): $17,000
Beginning Work in Procress: $10,000
Ending Work in Process: $11,000

The Cost of Goods Manufactured was

$89,000 $78,000 $79,000 $80,000 none of the above. 1. QUESTION 20 During the month of February, the cost of goods manufactured was $93,000. Beginning Finished Goods inventory was $44,000 and Ending Finished Goods inventory was $46,000. What was the Cost of Goods Sold for February? Ignore underapplied or overapplied manufacturing overhead adjustments. $89,000 $91,000 $95,000 $97,000 None of the above. 1. QUESTION 21 Manufacturing overhead is estimated to be $1000 for the period. Direct labor hours are estimated to be 250. Machine hours are estimated to be 450. Manufacturing overhead is applied based on Direct labor hours. What is the applied manufacturing overhead rate for the period? $10 00 $25 0 $2.2 2 $2.5 0 $4.0 0 1. QUESTION 22 Manufacturing overhead is estimated to be $1200 for the period. Direct labor hours are estimated to be 300 and manufacturing overhead is applied based on Direct labor hours. The actual Direct labor hours that were worked during the period were 305. What is applied manufacturing overhead? $4 $20 $1200 $1220 None of the above. 1. QUESTION 23 Manufacturing overhead is estimated to be $1200 for the period. Direct labor hours are estimated to be 300 and manufacturing overhead is applied based on Direct labor hours. The actual Direct labor hours that were worked during the period were 305. Actual manufacturing overhead for the period came in at $1230. Is manufacturing overhead overapplied or underapplied and by how much? Overapplied by $10 Overapplied by $20 Underapplied by $10 Underapplied by $20 Underapplied by $30 1. QUESTION 24 QRS Co adjusts Cost of Goods sold by overapplied or underapplied manufacturing overhead at period end, as was done in MBA840. Beginning WIP is $60. Materials requisitioned and put into production were $10. Applied manufacturing over was $15. Actual manufacturing overhead was $12. WIP transferred to Finished Goods was $20. Ending WIP was $100. What was the Direct Labor for the period? $23 $35 $47 $103 None of the above. 1. QUESTION 25 If overapplied or underapplied overhead is consistently a large amount relative to actual overhead, management should look at an interesting YouTube estimated overhead for the year the ocst driver or allocation base used both b and c both b and c and also period expenses 1. QUESTION 26 Direct Materials are $180; Direct Labor is $300; Manufacturing Overhead is applied based on direct labor costs. The predetermined overhead rate is 60%. Production and sales volume = 10 products. What is the cost of one product? $29.80 $36.00 $45.00 $66.00 None of the above. 1. QUESTION 27 The High Low Method and Regression Analysis help break out product costs from period costs. True False 1. QUESTION 28 Job-Order costing would be a logical system for a company making large yachts while Process Costing would work well for a company that makes toothpaste. True False 1. QUESTION 29 The Work in Process account accumulates production costs. True False 1. QUESTION 30 Sales = $200, Cost of Goods Sold = $120. Gross Margin is $80 True False 1. QUESTION 31 Sales = $300, Gross Margin = $200, All expenses = $75. Net Operating Income = $25 True False 1. QUESTION 32 Overapplied overhead means credits exceed debits in the Manufacturing Overhead account, True False 1. QUESTION 33 The entry to adjust Cost of Goods Sold for underapplied overhead debits Cost of Goods Sold. True False 1. QUESTION 34 The entry to adjust Cost of Goods Sold for overapplied overhead increases Cost of Goods Sold. True False 1. QUESTION 35 When cleaning supplies are used within the manufacturing factory, the journal entry is to debit manufacturing overhead. True False 1. QUESTION 36 An example of indirect labor is a quality inspector that is assigned throughout the manufacturing plant. True False 1. QUESTION 37 A predetermined overhead rate used to apply overhead is acceptable even though it calculates an estimate. That is because this method allows a more timely costing of the product even if some accuracy in cost is sacrificed. True False 1. QUESTION 38 Advertising paid to promote the product is a product cost. True False 1. QUESTION 39 When completed products are transferred out of WIP and into Finished Goods, the amount shown in the transaction is the Cost of Goods Manufactured (ignoring overapplied or underapplied overhead). True False 1. QUESTION 40 You have applied yourself, and perhaps even overapplied yourself so far in this course. You are Finished. Good. (Hint: the answer rhymes with through). True False