Reference no: EM13845176

Question 1. Assume the following information pertaining to a Company:

a. Prime costs = $195,000

b. Conversion Costs = $221,000

c. Direct Materials used = $85,000

d. Beginning Work-in-Process = $98,000

e. Ending Work-in-Process = $81,000

Question 2. Factory overhead is calculated to be:

a. $306,000.

b. $26,000.

c. $110,000.

d. $84,000.

e. $111,000.

Question 3. Factory overhead costs for a given period were 2 times as much as the direct material costs. Prime costs totaled $8,000. Conversion costs totaled $11,350. What are the direct labor costs for the period?

a. $4,650.

b. $3,560.

c. $4,200.

d. $3,860.

Question 4. Which one of the following is the amount that actual factory overhead exceeds the factory overhead applied?

a. Factory overhead applied.

b. Actual factory overhead.

c. Overapplied overhead.

d. Allocated factory overhead.

e. Underapplied overhead.

Question 5. The journal entry to record incurred direct labor would include a credit to:

a. Work-in-Process Inventory.

b. Accrued Payroll.

c. Factory Overhead.

d. Materials Inventory.

e. Finished Goods Inventory.

Question 6. The two main advantages of using predetermined factory overhead rates are to provide more accurate unit cost information and to:

a. Simplify the accounting process.

b. Provide cost information on a timely basis.

c. Insure transmission of correct data.

d. Extend the useful life of the cost data.

e. Adjust for variances in data sources.

Question 7. Standard costs are:

a. Planned costs the firm should attain.

b. Associated with direct materials and factory overhead only.

c. Associated with direct labor and factory overhead only.

d. Targeted low costs the firm should strive for.

e. None of the above.

Question 8. Which of the following companies uses process costing systems?

a. Accenture.

b. Coca-Cola.

c. Jiffy Lube International.

d. A professional service firm.

e. All of the above.

Question 9. ABC Company uses a Materials Inventory account to record both direct and indirect materials. ABC charges direct materials to WIP, while indirect materials are charged to the Factory Overhead account. During the month of April, the company has the following cost information:

Total Materials (Direct and Indirect) Purchased = $ 90,000

Indirect Materials Issued to Production = 30,000

Total Materials Issued to Production = 110,000

Beginning Materials Inventory = 50,000

The debit to Work-in-Process Inventory account for materials is:

a. $110,000.

b. $30,000.

c. $90,000.

d. $80,000.

Question 10. East Bay Fisheries Inc. processes king salmon for various distributors. Two departments are involved - processing and packaging. Data relating to tons of king salmon processed in the processing department during June 2013 are provided below:

Tons of Percent Completed

King Salmon Materials Conversion

Work-in-Process Inventory - June 1 1,500 90 80

Work-in-Process Inventory - June 1 2,800 60 40

Started processing during June 7,800

Total equivalent units for materials under the weighted-average method are calculated to be:

a. 6,830 equivalent units.

b. 8,180 equivalent units.

c. 6,980 equivalent units.

d. 7,140 equivalent units.

e. 7,620 equivalent units.

Question 11. The use of a relationship of total factory overhead to direct labor hours is said to be valid only within the relevant range, which means:

a. Within a reasonable dollar amount for labor costs.

b. Within the range of observations of the cost driver.

c. Within the range of reasonableness as judged by the department supervisor.

d. Within the budget allowance for overhead.

Question 12. The point in a joint production process at which individual products can be identified for the first time is called the:

a. Separable point.

b. By-pass point.

c. Split-off point.

d. Joint identification point.

Question 13. Cost-volume-profit (CVP) relationships that are curvilinear may be analyzed linearly by considering only:

a. Fixed and semi-variable costs.

b. Relevant fixed costs.

c. Relevant variable costs.

d. A relevant range of volume.

e. The multi-product/multi-service context.

Question 14. Which one of the following methods of allocating joint costs allocates joint costs to joint products on the basis of estimated sales values at the split-off point?

a. Net realizable value method.

b. Physical measure method.

c. Average cost method.

d. Net sales value method.

e. Sales value at split-off method.

Question 15. The contribution income statement would require a firm to:

a. Separate costs into fixed and variable categories.

b. Separate revenue into different categories.

c. Round off amounts to the nearest dollar.

d. Ignore some estimated fixed expenses, such as depreciation, that don't involve a cash outlay.

e. Restructure its accounting system to accommodate activity-based costing

Question 16 Variable costs will generally be relevant for decision making because they:

a. Differ between options.

b. Are volume-based.

c. Have not been committed and differ between options.

d. Differ between options and have been committed.

e. Measure opportunity cost.