A03 Online Exam 8_07 Score 85%

Question-1

Calculate the cost of goods sold when beginning finished goods inventory equals $70,000, ending finished goods inventory is $85,000, and cost of goods manufactured is $600,000.

A.  $615,000 

B.  $445,000 

C.  $685,000 

D.  $585,000

Question-2

Which of the following is an approach to sensitivity analysis?

A.  contribution

B.  distribution

C.  margin

D.  profit

Question-3

The formula for cost of goods manufactured is __________.

A.  raw materials plus direct labor minus overhead plus beginning work-in-process inventory plus ending work-in-process inventory 

B.  raw materials minus direct labor plus overhead plus beginning work-in-process inventory plus ending work-in-process inventory 

C.  beginning work-in-process plus total manufacturing cost minus ending work-in-process 

D.  raw materials plus direct labor less overhead plus beginning work-in-process inventory less ending work-in-process inventory

Question-4

If direct labor for the month is $40,000, overhead is applied based on direct labor, annual overhead is $600,000, and annual direct labor is $1,000,000, what is the entry to charge direct labor to production?

A.  debit Work-in-Process Inventory $40,000; credit Payroll $40,000 

B.  debit Overhead-Applied $40,000; credit Work-in-Process Inventory $40,000 

C.  debit Work-in-Process Inventory $24,000; credit Overhead-Applied $24,000 

D.  debit Work-in-Process Inventory $66,000; credit Overhead-Applied $66,000

Question-5

If direct labor for the month is $80,000 and overhead is applied based on 75% of direct labor dollars, what is the entry to apply overhead?

A.  debit Work-in-Process Inventory $80,000; credit Payroll $80,000 

B.  debit Overhead-Applied $60,000; credit Work-in-Process Inventory $60,000 

C.  debit Work-in-Process Inventory $60,000; credit Overhead-Applied $60,000 

D.  debit Work-in-Process Inventory $80,000; credit Overhead-Applied $80,000

Question-6

An element of sensitivity analysis includes __________.

A.  unidimensional changes     (Incorrect)

B.  a sole focus on profit 

C.  simultaneous changes 

D.  a financial accounting approach

Question-7

Which of the following is part of a firm’s master budget?

A.  pro forma budget  (Incorrect)

B.  inventory purchases budget 

C.  operating budget 

D.  schedule of cash receipts budget

Question-8

During the week ending on November 30, total factory payroll incurred was $6,000. Of this total, 80% was for direct labor. The entry to record the payroll distribution would include __________.

A.  debit Work-in-Process Inventory $4,800 and Overhead-Control $1,200 

B.  debit Work-in-Process Inventory $6,000 

C.  debit Work-in-Process Inventory $4,800 and Overhead-Applied $1,200 

D.  debit Work-in-Process Inventory $4,800 and Indirect Labor Expense $1,200

Question-9

Candyland completed the manufacturing process. The entry to transfer the product to finished goods is __________.

  A.   

Raw Materials Inventory

Finished Goods Inventory

  B.   

Finished Goods Inventory

Cost of Goods Sold

  C.   

Finished Goods Inventory

Work-in-Process Inventory

  D.   

Finished Goods Inventory

Raw Materials Inventory

Question-10

Sensitivity analysis is part of __________.

A.  income statement analysis 

B.  gross profit analysis 

C.  cost analysis 

D.  cost-volume-profit analysis

Question-11

The entry to record rent expense $9,000, supervision expense $19,000, and depreciation expense $7,000 to overhead is __________.

A.  debit Overhead-Applied $35,000; credit Rent Expense $9,000; credit Supervision $19,000; credit Depreciation Expense $7,000 

B.  debit Overhead-Control $35,000; credit Rent Expense $9,000; credit Supervision $19,000; credit Depreciation Expense $7,000 

C.  debit Overhead-Applied $35,000; credit Overhead-Control $35,000 

D.  none of the above  (Incorrect)

Question-12

What is the journal entry to record issuing supplies from the storeroom?

A.  debit Overhead-Applied; credit Raw Materials Inventory 

B.  debit Overhead-Control; credit Supplies Inventory 

C.  debit Supplies Inventory; credit Overhead-Applied 

D.  debit Overhead-Applied; credit Supplies Inventory

Question-13

A budget enables managers to __________.

A.  focus solely on production 

B.  adopt lax standards 

C. abrogate responsibility for financial goals 

D.  achieve company objectives

Question-14

ABC Restaurant’s revenue budget reflects the following information for February:

Food sales

$260,000

Beverage and liquor sales

$140,000

Total sales

$300,000

ABC expects revenue to increase by 5% during both March and April. What is the budgeted amount of beverage and liquor sales revenue for March?

A.  $145,000 

B.  $154,350 

C.  $147,000 

D.  $150,000

Question-15

Manufacturing overhead includes all manufacturing costs __________.

A.  including raw materials 

B.  including overhead 

C.  excluding raw materials and direct labor 

D.  none of the above

Question-16

Factory Supplies Expense, Depreciation Expense-Factory, and Heat, Light, and Power-Factory appear on which section of the worksheet?

A.  statement of cost of goods manufactured 

B.  balance sheet 

C.  income statement 

D.  statement of cost of goods sold

Question-17

Omega.com sold 25 jet skis for $7,000 which cost $5,000. The entry to record the sale would include __________.

A.  credit to Finished Goods Inventory for $5,000 

B.  credit to Sales for $7,000 

C.  debit to Cost of Goods Sold for $5,000 

D.  all of the above

Question-18

ABC Restaurant’s revenue budget reflects the following information for February:

Food sales

$260,000

Beverage and liquor sales

$140,000

Total sales

$300,000

ABC expects revenue to increase by 5% during both March and April. What is the budgeted amount of food sales revenue for April?

A.  $286,650 

B.  $272,650 

C.  $288,250 

D.  $292,350

Question-19

Journal entries crediting Payroll and debiting Work-in-Process Inventory are made for __________.

A.  administrative salaries 

B.  hourly manufacturing labor 

C.  foremen’s salaries 

D.  raw materials

Question-20

The entry to record the requisition of supplies from the storeroom would include __________.

A.  debit to Raw Materials; credit to Work-in-Process 

B.  debit to Overhead-Applied; credit to Overhead-Control 

C.  debit to Work-in-Process; credit to Overhead-Control 

D.  debit to Overhead-Control; credit to Supplies Inventory