A decrease in work in process means that cost of goods manufactured was less than the manufacturing costs incurred.. Work in process, materials, and manufacturing overhead Which of the f
Trang 171 Test Bank for Managerial Accounting 1st Edition
by Oliver
Multiple Choice Questions
Which of the following statements is incorrect?
1 A The primary users of management accounting are the company’s
managers.
2 B Management accounting information is used to help managers plan and control their operations.
3 C Management accounting information does not require an external audit.
4 D Management accounting’s financial reports are restricted by generally accepted accounting principles.
Manufacturing overhead includes which of the following?
1 A Indirect labor and indirect materials
2 B Indirect materials and direct materials
3 C Direct materials and direct labor
4 D Factory rent and direct labor
A merchandising company’s:
1 A expenses include both period costs and product costs.
2 B expenses include only product costs.
3 C expenses include only period costs.
4 D income statement doesn’t include gross margin.
Which of the following best defines direct materials?
1 A Used to determine total inventoriable product costs
2 B Cannot be separately and conveniently traced through the
manufacturing process to finished goods
3 C Are not part of the finished product
4 D Used to determine total manufacturing overhead
Which of the following are period costs?
Trang 21 A Current assets on the balance sheet
2 B Costs incurred and expensed during the accounting period
3 C Costs related to the manufacture of products
4 D Current liabilities on the balance sheet
Which of the following statements is correct?
1 A A decrease in finished goods means that cost of goods manufactured is greater than cost of goods sold.
2 B A decrease in work in process means that cost of goods sold is greater than cost of goods manufactured.
3 C A decrease in raw materials implies that the cost of materials used in production exceeds the cost of the materials purchased.
4 D A decrease in work in process means that cost of goods manufactured was less than the manufacturing costs incurred.
Which of the following is a philosophy of providing customers with superior products and services?
1 A Just-in-time (JIT.
2 B ERP
3 C Supply chain management
4 D Total quality management
What is the name given to software systems that can integrate all
of a company's worldwide functions, departments and data into a single system?
1 A All in One Software
2 B Enterprise Resource Planning
3 C Total Integrated Software
4 D Just-in-time
Which of the following is an example of a period cost?
1 A Advertising expense
2 B Depreciation on factory equipment
3 C Indirect materials
4 D Property taxes on plant
Trang 3The following information pertains to Bright Toy Company's
operating activities for 2009 The company sells light box toys and sold 10,000 units in 2009 Purchases: $ 126,000; Selling and Administrative Expenses: 90,000; Merchandise inventory,
1/1/2009: 14,000; Merchandise inventory, 12/31/2009: 10,000; Sales Revenue 250,000 What is the cost of goods available for sale for 2009?
1 A $140,000
2 B $126,000
3 C $104,000
4 D $130,000
A merchandiser's purchases are equivalent to what for a
manufacturer?
1 A Materials inventory
2 B Cost of goods manufactured
3 C Work in process inventory
4 D Cost of goods sold
A service company’s:
1 A expenses are all period costs.
2 B expenses are all product costs.
3 C income statement includes gross margin.
4 D balance sheet includes finished goods inventory.
Which of the following could be found on the income statement of
a service company?
1 A Rent expense
2 B Cost of goods manufactured
3 C Cost of goods sold
4 D Manufacturing overhead
Which of the following is NOT a part of manufacturing overhead?
1 A Indirect materials
Trang 42 B Indirect labor
3 C Factory insurance
4 D Depreciation on delivery vehicles
The following information pertains to Bright Toy Company's
operating activities for 2009 The company sells light box toys and sold 10,000 units in 2009: Purchases $ 126,000; Selling and
Administrative Expenses 90,000; Merchandise inventory,
1/1/2009 14,000; Merchandise inventory, 12/31/2009 10,000; Sales Revenue 250,000; What is the cost per light box sold in 2009?
1 A $13.00
2 B $12.40
3 C $14.00
4 D $10.40
Which of the following costs would appear on the income
statements for both a merchandiser and a manufacturer?
1 A Direct labor incurred
2 B Cost of goods manufactured
3 C Direct materials used
4 D Operating expenses
What is total quality management?
1 A A philosophy of supplying customers with superior products and services
2 B An exchange of information with suppliers and customers to create efficient and effective processes
3 C A software system that integrates a company's functions, departments and data into a single system
4 D A system in which a company produces what it needs when it needs it Inventory accounts for a manufacturer include which of the
following?
1 A Materials, work in process, and finished goods
2 B Work in process, direct labor, and finished goods
Trang 53 C Merchandise, materials, and finished goods
4 D Work in process, materials, and manufacturing overhead
Which of the following statements about financial accounting is correct?
1 A Financial accounting helps investors make decisions.
2 B Financial accounting reports do not influence investor behavior.
3 C Financial provides detailed reports on parts of the company.
4 D Financial accounting provides help in planning and controlling
operations.
The following information pertains to Bright Toy Company's
operating activities for 2009 The company sells light box toys and sold 10,000 units in 2009: Purchases $ 126,000; Selling and
Administrative Expenses 90,000; Merchandise inventory,
1/1/2009 14,000; Merchandise inventory, 12/31/2009 10,000; Sales Revenue 250,000 What is the gross profit percentage?
1 A 48%
2 B 56%
3 C 36%
4 D 100%
Which of the following is NOT an objective of management
accounting?
1 A To provide information to business managers to assist them in planning for their business
2 B To provide information to business managers to assist them in
controlling their business
3 C To provide information to shareholders to assist them with their
investment decisions
4 D To assist business managers with respect to providing a return to the owners of the business
Which of the following statements does NOT describe today’s business environment?
Trang 61 A.The business environment is shifting toward a service economy.
2 B Global competition requires businesses to adjust their business
strategies.
3 C E-commerce has allowed business managers the opportunity to slow down the their manufacturing and delivery times.
4 D Enterprise resource planning systems have emerged to assist business manager with respect to integrating their worldwide functions.
The following information pertains to Bright Toy Company's
operating activities for 2009 The company sells light box toys and sold 10,000 units in 2009: Purchases $ 126,000; Selling and
Administrative Expenses: 90,000; Merchandise inventory,
1/1/2009: 14,000; Merchandise inventory, 12/31/2009: 10,000; Sales Revenue 250,000 What is the cost of goods sold for
2009?
1 A $104,000
2 B $124,000
3 C $130,000
4 D $140,000
Which of the following costs do NOT go directly into the work in process account?
1 A Factory overhead
2 B Indirect labor
3 C Factory janitorial costs
4 D The purchase of raw materials
Which of the following is an inventory account for a merchandise company?
1 A Work in process inventory
2 B Manufacturing overhead inventory
3 C Merchandise inventory
4 D Finished goods inventory
Trang 7Which of the following reports must be audited by certified public accountants?
1 A Annual financial reports
2 B Federal tax returns
3 C State tax returns
4 D Management accounting reports
Which of the following statements about managerial accounting is correct?
1 A Managerial accounting reports are audited annually by Certified Public Accountants.
2 B Managerial accounting reports help investors make decisions.
3 C Managerial accounting reports provide detailed information on parts of a company.
4 D Managerial accounting reports must follow Generally Accepted
Accounting principles (GAAP
Which of the following is NOT a product cost?
1 A Indirect labor
2 B Factory overhead
3 C Indirect materials
4 D Depreciation of corporate headquarters
Goods that are partially completed by a manufacturer are referred
to as:
1 A Materials inventory.
2 B Finished goods inventory.
3 C Merchandise inventory.
4 D Work in process inventory.
Which statement is correct?
1 A Management accounting uses the cash basis and financial accounting uses the accrual basis to record transactions.
2 B Management accounting uses the cash basis to record transactions.
3 C Financial accounting uses the cash basis to record transactions.
Trang 84 D Both management accounting and financial accounting use the accrual basis to record transactions.
The following information pertains to Bright Toy Company's
operating activities for 2009 The company sells light box toys and sold 10,000 units in 2009 Purchases $ 126,000; Selling and
Administrative Expenses 90,000; Merchandise inventory,
1/1/2009 14,000; Merchandise inventory, 12/31/2009 10,000; Sales Revenue 250,000 What is the profit margin percentage?
1 A 12%
2 B 56%
3 C 100%
4 D 36%
The following information pertains to Bright Toy Company's
operating activities for 2009 The company sells light box toys and sold 10,000 units in 2009 Purchases $ 126,000; Selling and
Administrative Expenses 90,000; Merchandise inventory,
1/1/2009 14,000; Merchandise inventory, 12/31/2009 10,000; Sales Revenue 250,000 What is the gross profit for 2009?
1 A $120,000
2 B $130,000
3 C $140,000
4 D $136,000
Which of the following types of accounting is designed to meet the needs of decision-makers inside a company?
1 A Financial accounting
2 B Tax accounting
3 C Management accounting
4 D Auditing
Wright Company reports production costs for 2009 as follows: Direct materials used $375,000; Direct labor incurred $250,000;
Trang 9Manufacturing overhead incurred $400,000; Operating expenses
$145,000 How much are Wright Company's period costs for 2009?
1 A $250,000
2 B $575,000
3 C $145,000
4 D $375,000
Which of the following is an example of direct labor?
1 A Wages of assembly line personnel
2 B Salary of vice president of production
3 C Wages of factory security
4 D Salary of production manager
Period costs do NOT include which of the following?
1 A Sales commissions
2 B Factory janitorial costs
3 C Insurance on delivery vehicles
4 D Advertising costs
Which of the following statements is incorrect?
1 A Management uses accounting information to determine the cost of products and services.
2 B Management uses accounting information to plan and control business operations.
3 C Management uses accounting information to report the company's financial position and results of operations to external parties.
4 D Financial accounting is more relevant to use for internal decision making purposes than is management accounting.
Which of the following is a characteristic of a service company?
1 A It transforms raw materials into finished goods.
2 B It makes a product.
3 C It does not have tangible products intended for sale.
4 D It has a single category of inventory.
Trang 10The following information pertains to Bright Toy Company's
operating activities for 2009 The company sells light box toys and sold 10,000 units in 2009: Purchases $ 126,000; Selling and
Administrative Expenses 90,000; Merchandise inventory,
1/1/2009 14,000; Merchandise inventory, 12/31/2009 10,000; Sales Revenue 250,000 What is the operating income for 2009?
1 A $250,000
2 B $140,000
3 C $30,000
4 D $90,000
Which of the following describes a system in which suppliers deliver materials at the time they are needed and finished units are completed when customer orders need to be filled?
1 A Supply chain management
2 B Just-in-time (JIT.
3 C Enterprise resource planning
4 D Total quality management
All of the following are examples of manufacturing overhead
except for which of the following?
1 A Utilities incurred in the factory
2 B Insurance expired on factory equipment
3 C Wages of assembly line workers
4 D Indirect materials
71 Free Test Bank for Managerial Accounting 1st
Edition by Oliver Multiple Choice Questions-Page 2
A company used $35,000 of direct materials, incurred $73,000 in direct labor cost, and $114,000 in manufacturing overhead costs during the period If beginning and ending work in process
Trang 11inventories were $28,000 and $21,000 respectively What is the cost of goods manufactured?
1 A $250,000
2 B $229,000
3 C $215,000
4 D $222,000
Given the following information, calculate the direct materials purchased in 2009 Materials inventory, 1/1/2009 $43,000;
Materials inventory, 12/31/2009 24,000; Work in process
inventory, 1/1/09 53,000; Work in process inventory, 12/31/09 61,000; Finished goods inventory, 1/1/2009 84,000; Finished goods inventory, 12/31/2009 97,000; Cost of goods sold 395,000; Cost of goods manufactured 408,000; Direct labor 156,000;
Manufacturing overhead costs 180,000;
1 A $67,000
2 B $85,000
3 C $61,000
4 D $80,000
Fitness Company reports the following data for 2009, its first year
of operations: Cost of goods manufactured $440,000; Work in process inventory, Dec 31, 2009 130,000; Direct materials used 115,000; Manufacturing overhead incurred 160,000; Finished goods inventory, Dec 31, 2009 75,000; What is cost of goods sold for 2009?
1 A $365,000
2 B $480,000
3 C $340,000
4 D $240,000
Which of the following properly describes the accounting for
advertising costs?
Trang 121 A Advertising costs are product costs and are expensed as incurred.
2 B Advertising costs are period costs and are expensed as incurred.
3 C Advertising costs are product costs and are expensed when the
manufactured product is sold.
4 D Advertising costs are period costs and are expensed when the
manufactured product is sold.
Manufacturing overhead should be classified as which of the following?
1 A Product cost
2 B Period cost
3 C Indirect cost
4 D Both A and C
Harrison Company reports the following cost information for
August: Cost of goods manufactured $135,800; Finished goods inventory, Aug 1 30,200; Finished goods inventory, Aug 31
35,300 ; Work in process inventory, Aug 1 22,500 ; Work in
process inventory, Aug 31 18,500; Direct materials used 25,300 Direct labor incurred in August amounted to 150% of
manufacturing overhead in August What is cost of goods sold for August?
1 A $154,500
2 B $125,100
3 C $130,700
4 D $139,800
Beginning work in process is equal to:
1 A ending work in process plus manufacturing costs incurred during the current period.
2 B manufacturing costs incurred during the current period minus ending work in process.
3 C cost of goods manufactured minus ending work in process plus
manufacturing costs incurred in the current period.