TEST III: MULTIPLE CHOICE- THEORY Directions: Read each statement below carefully. Select the BEST answer for each of the following question. Write the letter of your choice on your sheet provided. Use capital letters. ANY FORM OF ALTERATION ON YOUR ANSWERS WILL BE CONSIDERED WRONG (1pt each) 21. These costs are incurred to transform raw materials into its finished products. a. Manufacturing costs b. Prime cost c. Conversion costs d. Direct labor 22. If you add the ending balance of work-in-process inventory and cost of goods manufactured, and from the sum, you deduct the sum of the beginning balance of workin-process inventory and factory overhead, the end result would be a. Total manufacturing costs b. Conversion costs c. Prime costs d. Direct materials 23. If the sum of direct materials, direct labor, and factory overhead is equal to the total manufacturing cost; the sum of total manufacturing costs and work-in-process beginning is a. Cost of goods manufactured b. Total manufacturing costs c. Total cost placed in process d. None of the above 24. In the absence of freight-in, purchase returns, allowance, and discounts, direct materials is computed by a. Deducting work-in-process beginning + direct labor+ factory overhead from the total of work-in-process end + cost of goods manufactured b. Deducting work-in-process beginning + direct labor + factory overhead from the total cost placed in process c. Deducting work-in-process beginning + direct labor + factory overhead from the total cost placed in process d. Deducting raw materials end from the total of raw materials beginning + purchases e. All of the above 25. The transportation expense of 20,000 paid for the transport of goods sold under F.O.B destination, prepaid is a a. Cost of inventory b. Cost of goods sold c. Marketing cost d. Factory overhead cost TEST I: MODIFIED IDENTIFICATION Directions: Classify the costs as one of the four options by writing the letter of the best answer on your answer sheet. (USE CAPITAL LETTERS). ANY FORM OF ALTERATION ON YOUR ANSWERS WILL BE CONSIDERED WRONG (1 pt each) The following costs are for MJ Manufacturing, a manufacturer of labels used in the packaging of a variety of products A Direct materials cost B Direct labor cost C Manufacturing overhead cost D Selling and administrative cost 1. Ink used in printing labels 2. Salary of the corporate controller 3. Depreciation on the factory overhead 4. Rent on finished goods warehouse 5. Paper for labels 6. Wages paid to machine operator 7. Income tax expense 8. Advertising 9. Cost of electricity to operate factory machine 10. Depreciation of delivery truck TEST II: TRUE or FALSE Directions: Write TRUE if the statement is correct, or FALSE if it is incorrect. ANY FORM OF ALTERATION ON YOUR ANSWERS WILL BE CONSIDERED WRONG (1 pt each) 11. It is easier to put up a manufacturing business than a merchandising business 12. The transportation cost in bringing in the raw materials for conversion into finished products is not part of manufacturing costs 13. The manufacturing business, like merchandising business, requires major investment in physical facilities such as factory plant and equipment 14. All labor cost used in production is direct labor 15. All costs of indirect materials and indirect labor shall be classified as overhead costs 16. The work-in-process inventory ending is part of manufacturing cost for the production period 17. The cost of goods manufactured and sold is a prime cost 18. Once the raw materials are transformed into finished goods, all costs used are called conversion cost. 19. Once raw materials are transformed into finished goods all costs under are called conversion cost 20. The salary of salesmen directly incurred for marketing of the product is to be treated as direct labor cost which will be part of prime cost 31. The total cost put into process for the period is 600,000 . Total conversion cost is 300,000 . The factory overhead is 1/3 of conversion cost. How much is the amount of direct materials a. 100,000 b. 200,000 c. 300,000 d. 500,000 32. The total finished goods inclusive of goods manufactured for the current period is 575,000 . The unsold finished goods at the end of the period is 125,000 . The cost of goods sold is 360% of ending inventory. How much is the finished goods ending inventory if sale is 562,000 a. 450,000 b. 325,000 c. 162,000 d. 125,000 33. The total cost of goods manufactured is 575,000 . The work-in-process at the end of the period is 50,000 more than the work-in-process at the beginning. How much is the amount of the total manufacturing cost? a. 625,000 b. 575,000 c. 525,000 d. 475,000 34. The total cost put into process for the period is 600,000 . Total conversion cost is 300,000 . The factory overhead is 1/3 of direct materials. How much is the amount of direct materials. a. 100,000 b. 200,000 c. 300,000 d. 500,000 35. The total manufacturing cost is 1,200,000 and the prime cost and conversion cost are 1,000,000 and 500,000 respectively. How much is the factory overhead? a. 200,000 b. 300,000 c. 500,000 d. 700,000 36. Accord corporation has two production departments, A and B, that incurred the following manufacturing costs during the month: How much is the prime cost? a. 1,800,000 b. 2,800,000 c. 2,000,000 d. 2,870,000 37. The total raw materials consumed are 100,000 . Total conversion cost is 200,000 , workin-process end is 30,000 , cost of goods manufactured is 285,000 . What is the work-inprocess beginning? a. 45,000 b. 30,000 c. 15,000 d. 10,000 38. The total manufacturing cost is 150,000 , the direct labor is 50,000 , and the direct material consumed is 60,000 . There is no beginning and ending work-in-process. At what amount should the cost of goods manufactured be reported? a. 260,000 b. 150,000 c. 110,000 d. 40,000 39. Total purchases of raw materials amounted to 350,000 . The ending inventory of raw materials is 20,000 more than the beginning inventory. How much is the amount of raw materials put into process? a. 370,000 b. 350,000 c. 330,000 d. 310,000 40. The total work-in-process is 330,000 . The beginning work-in-process is 30,000 and work-in-process at the end is 50,000 . How much us the total manufacturing costs for the period? a. 330,000 b. 310,000 c. 300,000 d. 280,000 TEST V: PROBLEM SOLVING Directions: Solve what is being asked on each problem. Show supporting computation in good form. Double line and encircle final answers. Answers with wrong and no solution will not be considered (3pt each) 41. The total units put into process are 1,000 pieces. The total cost put in-process is 48,750 . At the end of the period, actual inventory count resulted to: There are no beginning and ending inventories of finished goods. If even distribution of costs is applied, what is the amount of cost of goods sold? 42. The total units put into process are 1,000 pieces. The total cost put in-process is 351,425 . At the end of the period, actual inventory count resulted to: If even distribution of costs is applied, what is the amount of work-in-process at the end of the period? 43. Total purchase of raw materials at list price of 250,000 ; term: 10%;2/30,n/60. Freight of 10,000 was paid, F.O.B. destination collect. Subsequently, a portion of the total purchases with a list price of 10,000 was returned to supplier. What is the increase in the amount of the raw materials available for use? 44. The prime cost is 1,550,000 and the conversion cost is 1,450,000. The factory incurred an overhead of 950,000 with a 30% indirect labor and 30% indirect materials. What is the total manufacturing cost? 45. The following items appeared in the ledger account of work-in-process for the Wacwac manufacturing for the month of March: How much is the total manufacturing cost? For 46&47 The factory ledger of Diamond corporation contains the following cost data for the year ended December 31, 200x The total manufacturing costs charged to closing production during the year (including raw materials, direct labor, and factory overhead applied at the rate of 50% of direct labor cost), 1,372,000 46. The cost of direct labor charged to production during the year amounted to? 47. The total cost of raw materials purchased during the year amounted to? For 48-50 The following data were taken from Celeste Company for 200A: 49. What is the total manufacturing cost? 50. What is the cost of goods manufactured