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| 1 | |
Jenny Greene, a management accountant, is reporting the monthly costs for her employer, a large pharmaceutical company, using the following cost classifications: - new product research and development costs
- manufacturing process design costs
- supply costs
- manufacturing costs
- marketing costs
- distribution costs
- customer service costs
Jenny Greene is classifying costs according to: |
| | A) | behaviour |
| | B) | traceability |
| | C) | timing |
| | D) | the value chain |
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| 2 | |
Variable costs are costs that: |
| | A) | vary directly in total with changes in the level of activity |
| | B) | vary inversely in total with changes in the level of activity |
| | C) | decrease on a per unit basis as the level of activity increases |
| | D) | increase on a per unit basis as the level of activity increases |
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| 3 | |
Fixed costs are costs that: |
| | A) | remain constant in total as the level of activity changes |
| | B) | vary directly in total with changes in the level of activity |
| | C) | vary inversely in total with changes in the level of activity |
| | D) | increase on a per unit basis as the level of activity increases |
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| 4 | |
Bruce Browne is the management accountant for Stanway, a manufacturing company. He was very busy working at his computer finalising the month -end schedules for the cost of goods manufactured, cost of goods sold and the income statement, when a computer virus attacked his accounting data and completely destroyed it. As luck would have it, he was able to retrieve some of the data from his computer, previous printouts and work papers. The following is the data for the month that Bruce retrieved: | | $ |
| Beginning inventory, raw material | 40 000 | Ending inventory, raw material | ? | Purchases of raw materials | 105 000 | Direct material used | 100 000 | Direct labour | 250 000 | Manufacturing overhead | ? | Total manufacturing costs | 425 000 | Beginning inventory, work in process | 30 000 | Ending inventory, work in process | 10 000 | Cost of goods manufactured | ? | Beginning inventory, finished goods | 20 000 | Cost of goods available for sale | ? | Ending inventory, finished goods | ? | Cost of goods sold | 435 000 | Sales | ? | Gross profit | 200 000 | Selling and administrative expenses | 120 000 | Profit before taxes | ? | Income tax expense | 24 000 | Net profit | ? |
What is the correct ending balance for raw materials inventory that Bruce should report in the month-end balance sheet? |
| | A) | $35 000. |
| | B) | $45 000. |
| | C) | $100 000. |
| | D) | $105 000. |
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| 5 | |
Bruce Browne is the management accountant for Stanway, a manufacturing company. He was very busy working at his computer finalising the month-end schedules for the cost of goods manufactured, cost of goods sold and the income statement, when a computer virus attacked his accounting data and completely destroyed it. As luck would have it, he was able to retrieve some of the data from his computer, previous printouts and work papers. The following is the data for the month that Bruce retrieved:
| $ | Beginning inventory, raw material | 40 000 | Ending inventory, raw material | ? | Purchases of raw materials | 105 000 | Direct material used | 100 000 | Direct labour | 250 000 | Manufacturing overhead | ? | Total manufacturing costs | 425 000 | Beginning inventory, work in process | 30 000 | Ending inventory, work in process | 10 000 | Cost of goods manufactured | ? | Beginning inventory, finished goods | 20 000 | Cost of goods available for sale | ? | Ending inventory, finished goods | ? | Cost of goods sold | 435 000 | Sales | ? | Gross profit | 200 000 | Selling and administrative expenses | 120 000 | Profit before taxes | ? | Income tax expense | 24 000 | Net profit | ? |
What is the correct monthly cost of goods manufactured that Bruce should report in the monthly schedule of cost of goods manufactured? |
| | A) | $370 000. |
| | B) | $330 000. |
| | C) | $445 000. |
| | D) | $350 000. |
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| 6 | |
Bruce Browne is the management accountant for Stanway, a manufacturing company. He was very busy working at his computer finalising the month-end schedules for the cost of goods manufactured, cost of goods sold and the income statement, when a computer virus attacked his accounting data and completely destroyed it. As luck would have it, he was able to retrieve some of the data from his computer, previous printouts and work papers. The following is the data for the month that Bruce retrieved:
| $ | Beginning inventory, raw material | 40 000 | Ending inventory, raw material | ? | Purchases of raw materials | 105 000 | Direct material used | 100 000 | Direct labour | 250 000 | Manufacturing overhead | ? | Total manufacturing costs | 425 000 | Beginning inventory, work in process | 30 000 | Ending inventory, work in process | 10 000 | Cost of goods manufactured | ? | Beginning inventory, finished goods | 20 000 | Cost of goods available for sale | ? | Ending inventory, finished goods | ? | Cost of goods sold | 435 000 | Sales | ? | Gross profit | 200 000 | Selling and administrative expenses | 120 000 | Profit before taxes | ? | Income tax expense | 24 000 | Net profit | ? |
What is the correct ending balance for finished goods inventory that Bruce should report in the month-end balance sheet? |
| | A) | $20 000. |
| | B) | $10 000. |
| | C) | $30 000. |
| | D) | $40 000. |
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| 7 | |
Bruce Browne is the management accountant for Stanway, a manufacturing company. He was very busy working at his computer finalising the month-end schedules for the cost of goods manufactured, cost of goods sold and the income statement, when a computer virus attacked his accounting data and completely destroyed it. As luck would have it, he was able to retrieve some of the data from his computer, previous printouts and work papers. The following is the data for the month that Bruce retrieved:
| $ | Beginning inventory, raw material | 40 000 | Ending inventory, raw material | ? | Purchases of raw materials | 105 000 | Direct material used | 100 000 | Direct labour | 250 000 | Manufacturing overhead | ? | Total manufacturing costs | 425 000 | Beginning inventory, work in process | 30 000 | Ending inventory, work in process | 10 000 | Cost of goods manufactured | ? | Beginning inventory, finished goods | 20 000 | Cost of goods available for sale | ? | Ending inventory, finished goods | ? | Cost of goods sold | 435 000 | Sales | ? | Gross profit | 200 000 | Selling and administrative expenses | 120 000 | Profit before taxes | ? | Income tax expense | 24 000 | Net profit | ? |
What is the correct net profit after taxes that Bruce should report in the monthly income statement? |
| | A) | $80 000. |
| | B) | $115 000. |
| | C) | $235 000. |
| | D) | $56 000. |
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| 8 | |
Total costs are $10 000 when 5000 units are produced; of this amount, variable costs are $6000. What are the total costs when 7500 units are produced? |
| | A) | $15 000. |
| | B) | $13 000. |
| | C) | $10 000. |
| | D) | $9000. |
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| 9 | |
Conversion costs are: |
| | A) | prime costs |
| | B) | direct labour and manufacturing overhead |
| | C) | direct materials, direct labour and manufacturing overhead |
| | D) | direct materials and direct labour |
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| 10 | |
Product costs for financial accounting reports are: |
| | A) | always fixed costs |
| | B) | always variable costs |
| | C) | always expensed when incurred |
| | D) | always inventoriable |
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