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Exam 16: Managerial Accounting Concepts and Principles

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Question 31

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The following are some of the costs incurred by Cupcake Company. Identify them as either: -Depreciation expense-factory

A) Prime costs
B) Conversion costs
C) Both prime and conversion costs
D) Neither prime or conversion costs

E) All of the above
F) B) and D)

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Question 32

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Which of the following would be least likely to be considered a managerial accounting report?

A) a report to analyze potential efficiencies and savings for the purchase of new production equipment
B) a schedule of total manufacturing costs incurred
C) a statement of cost of goods manufactured
D) a statement of stockholders' equity

E) A) and B)
F) B) and C)

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Question 33

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Work in process inventory increased by $20,000 during the current year. Cost of goods manufactured was $180,000. Total manufacturing costs incurred are

Factory overhead includes all manufacturing costs except direct materials and direct labor.

For an automotive repair shop, the wages of mechanics would be classified as direct labor cost.

Indirect labor would be included in factory overhead.

A cost object indicates how costs are related or identified.

Conversion costs are the combination of direct labor, direct material, and factory overhead costs. a. True b. False

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

All of the following could be considered a direct material except

A product cost is

Match the items below for a bakery to the type of cost a-d) . -Factory rent

Product costs

Which of the following will not be found on the balance sheet of a manufacturing company?

A diagram of the operating structure of an organization is called an organization chart.

Manufacturers use machinery and labor to convert direct materials into finished products.

Prime costs are the combination of direct materials and direct labor costs.

In most business organizations, the chief management accountant is called the

Conversion cost is the combination of direct labor cost and factory overhead cost.

The Putney Company reports the following information: $\begin{array} { | l | l | } \hline \text { Sales } & \$ 76,500 \\\hline \text { Direct materials used } & 7,300 \\\hline \text { Depreciati on on factory equipment } & 4,700 \\\hline \text { Indirect labor } & 5,900 \\\hline \text { Direct labor } & 10,500 \\\hline \text { Factory rent } & 4,200 \\\hline \text { Factory utilities } & 1,200 \\\hline \text { Sales salaries expense } & 15,600 \\\hline \text { Office salaries expense } & 8,900 \\\hline \text { Indirect materials } & 1,200 \\\hline\end{array}$ Compute: a) product costs b) period costs