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Exam 1: Managerial Accounting Concepts and Principles

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Question 21

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Which of the following costs is not included in factory overhead?

A) Payroll taxes on the wages of factory supervisors.
B) Indirect labor.
C) Depreciation of manufacturing equipment.
D) Manufacturing supplies used.
E) Direct materials.

F) D) and E)
G) A) and B)

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Question 22

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Use the following data to compute total manufacturing costs for the month: $\begin{array}{|l|r|}\hline\text { Sales commissions ....................... } & \$ 10,800 \\\hline \text { Direct labor } & 39,600 \\\hline \text { Indirect materials ......................... } & 15,200 \\\hline \text { Factory manager salaries } & 7,200 \\\hline \text { Factory supplies } & 9,000 \\\hline \text { Indirect labor } & 6,300 \\\hline \text { Depreciation-office equipment..................... } & 5,000 \\\hline \text { Direct materials .............. } & 40,500 \\\hline \text { Dorporate office salaries } & 42,500 \\\hline\text { Depreciation-factory equipment } & 7,500\\\hline \end{array}$

A) $141,100.
B) $125,300.
C) $45,200.
D) $84,800.
E) $58,300.

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

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Question 23

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Raw materials purchased plus beginning raw materials inventory equals the ending balance of raw materials inventory.

An approach to managing inventories and production operations such that units of materials and products are obtained and provided only as they are needed is called:

Information for Stanton, Inc., as of December 31 follows. Prepare a schedule of cost of goods manufactured for the year ended December 31.

Using the information below, calculate cost of goods sold for the period:

A management concept that seeks to uncover and eliminate waste in all aspects of business activities is called:

The schedule of cost of goods manufactured must be prepared monthly as it is a required general-purpose financial statement.

Using the information below for Sundar Company; determine the total manufacturing costs added during the current year: $\begin{array} { | l | r | } \hline \text { Direct materials used } & \$ 19,000 \\\hline \text { Direct labor used } & 24,500 \\\hline \text { Factory overhead } & 55,100 \\\hline \text { Beginning work in process } & 10,700 \\\hline \text { Ending work in process } & 11,300\\\hline \end{array}$

Which of the following represents the correct formula for calculating raw materials inventory turnover for a manufacturer?

Both financial and managerial accounting rely on accepted principles that are enforced through an extensive set of rules and guidelines.

Total manufacturing costs incurred during the year do not include:

Just-in-time manufacturing techniques can be useful in _____________ days' sales in raw materials inventory.

The Work in Process Inventory account is found only in the ledgers of manufacturing companies.

Using the information below for Sundar Company; determine the cost of goods manufactured during the current year: $\begin{array} { | l | r | } \hline \text { Direct materials used } & \$ 19,000 \\\hline \text { Direct labor used } & 24,500 \\\hline \text { Factory overhead } & 55,100 \\\hline \text { Beginning work in process } & 10,700 \\\hline \text { Ending work in process } & 11,300\\\hline \end{array}$

A management concept based on an understanding of the changing wants and needs of customers, and which leads to flexible product designs and production processes, is called:

Labor costs that are clearly associated with specific units of product because the labor is used to convert raw materials into finished products are called:

The cost of workers who assist in, or supervise, the manufacturing process, not linked to specific units of product is called:

Using the information below, compute the raw materials inventory turnover:

Asteroid Industries accumulated the following cost information for the year: $\begin{array} { | l | r | } \hline \text { Direct materials } & \$ 16,000 \\\hline \text { Indirect materials } & 4,000 \\\hline \text { Indirect labor } & 8,500 \\\hline \text { Factory depreciation } & 12,800 \\\hline \text { Direct labor } & 37,000 \\\hline\end{array}$ Using the above information, total factory overhead costs would be: