TIMED ASSIGNMENT

QUESTION 1

Managerial accounting information

	A.	is prepared only once a year.
	B.	pertains to subunits of the entity and may be very detailed.
	C.	is constrained by the requirements of generally accepted accounting principles.
	D.	pertains to the entity as a whole and is highly aggregated.

6 points   

QUESTION 2

The wages of a timekeeper in the factory would be classified as

	A.	indirect labor.
	B.	a period cost.
	C.	direct labor.
	D.	compliance costs.

6 points   

QUESTION 3

Edmiston Manufacturing Company reported the following year-end information: beginning work in process inventory, $80,000; cost of goods manufactured, $780,000; beginning finished goods inventory, $50,000; ending work in process inventory, $70,000; and ending finished goods inventory, $40,000. How much is Edmiston's cost of goods sold for the year?

	A.	$800,000
	B.	$780,000
	C.	$770,000
	D.	$790,000

6 points   

QUESTION 4

Ogleby Manufacturing Inc.'s accounting records reflect the following inventories:

Dec. 31, 2011

Dec. 31, 2012

1.

	Raw materials inventory	$180,000	$144,000
	Work in process inventory	234,000	261,000
	Finished goods inventory	225,000	207,000

During 2012, Ogleby purchased $1,401,000 of raw materials, incurred direct labor costs of $225,000, and incurred manufacturing overhead totaling $288,000. How much is total manufacturing costs incurred during 2012 for Ogleby?

	A.	$1,959,000
	B.	$1,923,000
	C.	$1,950,000
	D.	$1,932,000

6 points   

QUESTION 5

Which one of the following best describes a job cost sheet?

	A.	It is a form used to record the costs chargeable to a specific job and to determine the total and unit costs of the completed job.
	B.	It is used by management to understand how direct costs affect profitability.
	C.	It is used to track manufacturing overhead costs to specific jobs.
	D.	It is a daily form that management uses for tracking worker productivity on which employee raises are based.

6 points   

QUESTION 6

Manufacturing overhead is applied to each job

	A.	only if the overhead costs can be directly traced to that job.
	B.	at the end of the year when actual costs are known.
	C.	by means of a predetermined overhead rate.
	D.	at the time when the overhead cost is incurred.

6 points   

QUESTION 7

A major purpose of cost accounting is to

	A.	measure, record, and report period costs.
	B.	classify all costs as operating or nonoperating.
	C.	measure, record, and report product costs.
	D.	provide information to stockholders for investment decisions.

6 points   

QUESTION 8

Kimble Company applies overhead on the basis of machine hours. Given the following data, compute overhead applied and the under- or overapplication of overhead for the period:

	Estimated annual overhead cost	$1,600,000
	Actual annual overhead cost	$1,540,000
	Estimated machine hours	400,000
	Actual machine hours	380,000

 

	A.	$1,600,000 applied and $20,000 overapplied
	B.	$1,520,000 applied and $20,000 underapplied
	C.	$1,520,000 applied and $20,000 overapplied
	D.	$1,463,000 applied and neither under- nor overapplied

QUESTION 9

Fort Corporation had the following transactions during its first month of operations: 1. Purchased raw materials on account, $95,000. 2. Raw Materials of $30,000 were requisitioned to the factory. An analysis of the materials requisition slips indicated that $5,000 was classified as indirect materials. 3. Factory labor costs incurred were $150,000. Time tickets indicated that $118,000 was direct labor and $32,000 was indirect labor. 4. Overhead costs incurred on account were $160,000. 5. Manufacturing overhead was applied at the rate of 150% of direct labor cost. 6. Goods costing $115,000 are still incomplete at the end of the month; the other goods were completed and transferred to finished goods. 7. Finished goods costing $100,000 to manufacture were sold on account for $130,000. Instructions Journalize the above transactions for Fort Corporation. (2 point each, #5-3 points each)

QUESTION 10

A characteristic of products that are mass-produced in a continuous fashion is that

	A.	they are produced at the time an order is received.
	B.	they are grouped in batches.
	C.	the products are identical or very similar in nature.
	D.	their costs are accumulated on job cost sheets.

6 points   

QUESTION 11

In a process cost system,

	A.	a materials requisition must identify the job on which the materials will be used.
	B.	a Work in Process account is maintained for each process.
	C.	one Work in Process account is maintained for all the processes, similar to a job order cost system.
	D.	a Work in Process account is maintained for each product.

6 points   

QUESTION 12

In the month of June, a department had 20,000 units in beginning work in process that were 70% complete. During June, 70,000 units were transferred into production from another department. At the end of June there were 10,000 units in ending work in process that were 40% complete. Materials are added at the beginning of the process, while conversion costs are incurred uniformly throughout the process. How many units were transferred out of the process in June?

	A.	70,000 units.
	B.	90,000 units.
	C.	80,000 units.
	D.	100,000 units.

6 points   

QUESTION 13

Cohen Manufacturing is trying to determine the equivalent units for conversion costs with 5,000 units of ending work in process at 60% completion and 30,000 physical units that are 100% complete as to materials. There are no beginning units in the department. Materials are added at the beginning of the process, and conversion costs occur evenly throughout the entire production period. What is the equivalent units for conversion costs for the current period?

	A.	40,000.
	B.	33,000.
	C.	4,000.
	D.	39,000.

6 points   

QUESTION 14

Mayer Manufacturing has recently tried to improve its analysis for its manufacturing process. Units started into production equaled 18,000 and ending work in process equaled 1,200 units. Mayer had no beginning work in process inventory. Conversion costs are applied equally throughout production, and materials are applied at the beginning of the process. How much is the materials cost per unit if ending work in process was 25% complete and total materials costs equaled $90,000?

	A.	$20.00.
	B.	$4.69.
	C.	$5.27.
	D.	$5.00.

6 points   

QUESTION 15

Cost behavior analysis is a study of how a firm's costs

	A.	respond to changes in the gross national product.
	B.	relate to general price level changes.
	C.	respond to changes in the level of business activity.
	D.	relate to competitors' costs.

6 points   

QUESTION 16

Which of the following is not a fixed cost?

	A.	Direct materials
	B.	Lease charge
	C.	Property taxes
	D.	Depreciation

6 points   

QUESTION 17

The relevant range of activity refers to the

	A.	level of activity where all costs are constant.
	B.	geographical areas where the company plans to operate.
	C.	levels of activity over which the company expects to operate.
	D.	activity level where all costs are curvilinear.

6 points   

QUESTION 18

Which of the following is not an underlying assumption of CVP analysis?

	A.	Beginning inventory is larger than ending inventory.
	B.	Sales mix is constant.
	C.	Changes in activity are the only factors that affect costs.
	D.	Cost classifications are reasonably accurate.

6 points   

QUESTION 19

In applying the high-low method, what is the fixed cost?

Month

Miles

Total Cost

1.

	January	80,000	$144,000
	February	50,000	120,000
	March	70,000	141,000
	April	90,000	195,000

 

	A.	$26,250
	B.	$54,000
	C.	$75,000
	D.	$21,000

6 points   

QUESTION 20

Isakson Company has a contribution margin per unit of $21 and a contribution margin ratio of 40%. How much is the selling price of each unit?

	A.	$35.00
	B.	$52.50
	C.	$12.60
	D.	Cannot be determined without more information.

6 points   

QUESTION 21

Sonoma Winery has fixed costs of $15,000 per year. Its warehouse sells wine with variable costs of 70% of its unit selling price. How much in sales does Sonoma need to break even per year?

	A.	$75,000
	B.	$50,000
	C.	$12,000
	D.	$18,750

6 points   

QUESTION 22

1. Quinn Company reports the following results for the month of November:

	Sales (10,000 units)	$600,000
	Variable costs	420,000
	Contribution margin	180,000
	Fixed costs	110,000
	Net income	$ 70,000

Management is considering the following independent courses of action to increase net income.

1.	Increase selling price by 5% with no change in total variable costs.
2.	Reduce variable costs to 65% of sales.
3.	Reduce fixed costs by $20,000.

Instructions Calculate the new net income under each scenario. (5 points each)