Question 1

A product cost is:

Accepted Answer

A)   expensed in the period in which it is incurred
B)   shown with current liabilities on the balance sheet
C)   shown on the income statement with the operating expenses
D)   expensed in the period the product is soldE) B) and C)
F) A) and D)

Question 2

Accounting designed to meet the needs of decision-makers inside the business is referred to as:

Accepted Answer

A)   general accounting
B)   financial accounting
C)   managerial accounting
D)   external accountingE) A) and D)
F) A) and C)

Question 3

Which of the following is not a factory overhead cost?

Accepted Answer

A)   materials used directly in the manufacturing process of the product
B)   insurance on factory equipment
C)   salaries of production supervisors
D)   property tax on factory buildingE) B) and C)
F) None of the above

Question 4

If the cost of direct materials is a small portion of total production cost, it may be classified as part of:

Accepted Answer

A)   direct labor cost
B)   selling and administrative costs
C)   miscellaneous costs
D)   factory overhead costE) A) and B)
F) C) and D)

Question 5

What term is used to describe the process of developing the organization's objectives and translating those into courses of action?

Accepted Answer

A)   Supervising
B)   Planning
C)   Improving
D)   Decision makingE) A) and B)
F) A) and C)

Question 6

Depreciation on factory plant and equipment is an example of factory overhead cost.

Accepted Answer

A) True 
 B)False

Question 7

A company manufactured 50,000 units of a product at a cost of $450,000. They sold 40,000 units for $15 each. What is the gross margin?

Accepted Answer

A)   $750,000
B)   $240,000
C)   $600,000
D)   $450,000E) All of the above
F) B) and C)

Question 8

All of the following are examples of indirect labor except:

Accepted Answer

A)   maintenance personnel
B)   janitorial personnel
C)   machine operators
D)   plant managersE) A) and C)
F) All of the above

Question 9

All of the following employees hold line positions in Anthea Electric EXCEPT:

Accepted Answer

A)   vice president of production
B)   vice president of finance
C)   manager of the Valhalla Plant
D)   vice president of salesE) A) and B)
F) A) and C)

Question 10

In the income statement of a manufacturing company, what replaces purchases in the cost of goods section of a retail company?

Accepted Answer

A)   Finished goods
B)   Cost of merchandise available
C)   Cost of goods manufactured
D)   Work in process completedE) B) and C)
F) A) and C)

Question 11

In most business organizations, the chief accountant is called the treasurer.

Accepted Answer

A) True 
 B)False

Question 12

Factory overhead is an example of a product cost.

Accepted Answer

A) True 
 B)False

Question 13

Planning is the process of monitoring operating results and comparing actual results with the expected results.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following statements is false?

Accepted Answer

A)   There is no overlap between financial and managerial accounting.
B)   Managerial accounting sometimes relies on past information.
C)   Managerial accounting does not need to conform to GAAP
D)   Financial accounting must conform to GAAP.E) All of the above
F) B) and C)

Question 15

A performance report that identifies the amount of employee downtime is a financial accounting report.

Accepted Answer

A) True 
 B)False

Question 16

Direct costs can be specifically traced to a cost object.

Accepted Answer

A) True 
 B)False

Question 17

Prime costs consists of direct materials, indirect materials, and direct labor.

Accepted Answer

A) True 
 B)False

Question 18

A cost object indicates how costs are related or identified.

Accepted Answer

A) True 
 B)False

Question 19

The payment of dividends is an example of a cost.

Accepted Answer

A) True 
 B)False

Question 20

Sienna Company has the following information for January.
  Show your calculations to find the cost of goods manufactured.

Accepted Answer

The answer of Sienna Company has the following information for...

Exam 16: Managerial Accounting Concepts and Principles

Accounting designed to meet the needs of decision-makers inside the business is referred to as:

Correct AnswerverifiedShow Answer

A cost object indicates how costs are related or identified.

Correct AnswerverifiedShow Answer

If the cost of direct materials is a small portion of total production cost, it may be classified as part of:

Correct AnswerverifiedShow Answer

The payment of dividends is an example of a cost.

Correct AnswerverifiedShow Answer

Direct costs can be specifically traced to a cost object.

Correct AnswerverifiedShow Answer

In most business organizations, the chief accountant is called the treasurer.

Correct AnswerverifiedShow Answer

A performance report that identifies the amount of employee downtime is a financial accounting report.

Correct AnswerverifiedShow Answer

Prime costs consists of direct materials, indirect materials, and direct labor.

Correct AnswerverifiedShow Answer

Planning is the process of monitoring operating results and comparing actual results with the expected results.

Correct AnswerverifiedShow Answer

Which of the following is not a factory overhead cost?

Correct AnswerverifiedShow Answer

In the income statement of a manufacturing company, what replaces purchases in the cost of goods section of a retail company?

Correct AnswerverifiedShow Answer

Sienna Company has the following information for January. Show your calculations to find the cost of goods manufactured.

Correct AnswerverifiedShow Answer

All of the following are examples of indirect labor except:

Correct AnswerverifiedShow Answer

A company manufactured 50,000 units of a product at a cost of $450,000. They sold 40,000 units for $15 each. What is the gross margin?

Correct AnswerverifiedShow Answer

Depreciation on factory plant and equipment is an example of factory overhead cost.

Correct AnswerverifiedShow Answer

A product cost is:

Correct AnswerverifiedShow Answer

Factory overhead is an example of a product cost.

Correct AnswerverifiedShow Answer

All of the following employees hold line positions in Anthea Electric EXCEPT:

Correct AnswerverifiedShow Answer

What term is used to describe the process of developing the organization's objectives and translating those into courses of action?

Correct AnswerverifiedShow Answer

Which of the following statements is false?

Correct AnswerverifiedShow Answer

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