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Exam 18: Introduction to Managerial Accounting

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Question 21

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Product costs are not expensed until the product is sold.

A) True
B) False

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Question 22

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Indirect labor and indirect materials are classified as

A) factory overhead and product costs
B) factory overhead and period costs
C) operating costs and period costs
D) operating costs and product costs

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

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Question 23

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

The following information is taken from the financial records of Gunner Manufacturing:?? $\begin{array}{lr}\text { Cost of materials used } & \$ 45,000 \\\text { Direct labor costs } & 48,000 \\\text { Factory overhead } & 39,000 \\\text { Work in process, beginning } & 18,000 \\\text { Work in process, ending } & 28,000\end{array}$ What is the cost of goods manufactured?

All of the following would be reported on the balance sheet as a current asset except

What term is used to describe the process of monitoring operating results and comparing actual results with the expected results?

Which of the following statements is false?

Zoe Corporation has the following information for the month of March. Determine the (a) cost of goods manufactured and (b) cost of goods sold. $\begin{array}{lr}\text { Cost of materials used in production } & \$ 69,000 \\\text { Direct labor } & 27,000 \\\text { Factory overhead } & 34,000 \\\text { Work in process inventory, March 1 } & 15,000 \\\text { Work in process inventory, March 31 } & 19,500 \\\text { Finished goods inventory, March 1 } & 25,000 \\\text { Finished goods inventory, March 31 } & 23,000\end{array}$

Match the items below for a bakery to the type of cost (a-d) . Answers may be used more than once. -Depreciation expense-office

For each of the following, indicate whether the cost would typically be considered a product or period cost for the cost object given. -Direct labor incurred

Laramie Technologies has the following data:​​ $\begin{array} { l r } \text { Work in process inventory, beginning } & \$ 45,000 \\\text { Work in process inventory, ending } & 32,000 \\\text { Direct labor costs } & 56,000 \\\text { Cost of materials used } & 50,000 \\\text { Factory overhead } & 28,000\end{array}$ Calculate the cost of goods manufactured.

Managerial accounting provides useful information to managers on product costs.

For each of the following, indicate whether the cost would typically be considered a product or period cost for the cost object given. -Salary of plant manager

The costs of materials and labor that do not enter directly into the finished product are classified as factory overhead.

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

What is decision making? Who is responsible for decision making in a managerial situation?

Factory overhead is an example of a product cost.

Which of the following items would not be classified as part of factory overhead?

A cost can be a payment of cash for the purpose of generating revenues.

Use the information below for Darwin Company to answer the questions that follow. ​ $\begin{array} { l r } \text { Sales } & \$ 76,500 \\\text { Direct materials used } & 7,300 \\\text { Depreciation on factory equipment } & 4,700 \\\text { Indirect labor } & 5,900 \\\text { Direct labor } & 10,500 \\\text { Factory rent } & 4,200 \\\text { Factory utilities } & 1,200 \\\text { Sales salaries expense } & 15,600 \\\text { Office salaries expense } & 8,900 \\\text { Indirect materials } & 1,200\end{array}$ -Darwin Company's product costs are