2023 1 In comparing management accounting with financial accounting which of the following statements is true | Assignments Online
2023 1 In comparing management accounting with financial accounting which of the following statements is true | Assignments Online
Assignments Online 2023 Business Finance
1.) In comparing management accounting with financial accounting, which of the following statements is true?
Answer
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a. |
Both depend on the double-entry system of accounting. |
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b. |
Both require adherence to GAAP. |
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c. |
Financial accounting reports are more objective, whereas management accounting reports are more subjective. |
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d. |
Both use historical costs as their primary unit of measurement. |
2.) The unit of measurement used in management accounting is
Answer
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a. |
usually current replacement cost. |
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b. |
primarily the historical dollar. |
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c. |
any measurement unit that is useful in a particular situation. |
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d. |
the measurement unit used by competing companies. |
3.) The management process includes all of the following stages except
Answer
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a. |
plan. |
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b. |
communicate. |
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c. |
record. |
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d. |
evaluate. |
4.) Planning involves which of the following?
Answer
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a. |
Identifying operating tasks that minimize waste |
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b. |
Comparing actual performance to expected performance |
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c. |
Issuing periodic reports |
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d. |
Formulating long-term strategies |
5.) Which of the following is not part of the “perform” stage in the management process?
Answer
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a. |
Identifying operating activities that minimize waste |
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b. |
Hiring and training personnel |
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c. |
Matching human resources to the task to be performed |
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d. |
Controlling operations |
6.) Primary processes
Answer
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a. |
limit bottlenecks during production. |
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b. |
add value to a product or service. |
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c. |
apply only to a just-in-time environment. |
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d. |
include information systems and human resources. |
7.) The just-in-time philosophy emphasizes
Answer
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a. |
eliminating waste. |
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b. |
completing products on schedule. |
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c. |
increasing production. |
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d. |
finishing all products before starting new ones. |
8.) Jillian Harmon supervises 5 cashiers at Jack’s Market. In the past, each cashier served an average of 25 customers per hour. Two months ago, management remodeled the store and installed a new cash register system. Customers no longer need to take their groceries out of the basket. Last month the number of customers served was 5,185 and each cashier worked an average of 170 hours for the month. Based on this information, the service rate has
Answer
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a. |
decreased 21 percent. |
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b. |
decreased 20 percent. |
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c. |
increased 22 percent. |
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d. |
increased 19 percent. |
9.) Integrity standards of management accountants include
Answer
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a. |
refraining from accepting hospitality gifts from coworkers. |
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b. |
avoiding actual or apparent conflicts of interest. |
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c. |
refraining from activities that the company does not actively endorse. |
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d. |
avoiding only those conflicts of interest that occur between coworkers. |
10.)The objectivity standards of management accountants state that management accountants must communicate information fairly and objectively. This means essentially that accountants must perform each task
Answer
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a. |
to provide relevant information, both positive and negative, to the recipients of their reports. |
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b. |
to the satisfaction of government regulators. |
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c. |
as professionals, possessing the degree of skill of those management accountants who held the position before them. |
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d. |
in conformity with generally accepted accounting principles. |
11.)Another term for product cost is
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a. |
direct cost. |
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b. |
inventoriable cost. |
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c. |
period cost. |
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d. |
value-adding cost. |
12.)Prime costs consist of
Answer
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a. |
direct labor and overhead. |
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b. |
direct materials and direct labor. |
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c. |
direct labor and indirect labor. |
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d. |
direct materials and overhead. |
13.)Costs such as salary of supervisors and other support personnel, which are accounted for as overhead costs, are called
Answer
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a. |
sales assistance. |
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b. |
direct labor. |
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c. |
indirect labor. |
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d. |
variable labor. |
14.)All manufacturing costs incurred and assigned to products that are being produced are classified as
Answer
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a. |
allocated costs. |
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b. |
variable costs. |
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c. |
product costs. |
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d. |
overhead costs. |
15.)Recorded costs for the DC5 Division, which manufactured 6,000 units of Product DC5 during the month, are as follows:
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Direct materials |
$458,000 |
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Direct labor |
400,000 |
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Indirect production costs |
80,000 |
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Supervisory services |
40,000 |
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Total |
$978,000 |
The per-unit cost of manufacturing Product DC5 this month is
Answer
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a. |
$152. |
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b. |
$170. |
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c. |
$163. |
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d. |
$150. |
16.)Which of the following represents normal cost measurement?
Answer
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a. |
Actual Direct Materials + Actual Direct Labor + Estimated Overhead |
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b. |
Actual Direct Materials + Actual Direct Labor + Actual Overhead |
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c. |
Estimated Direct Materials + Estimated Direct Labor + Actual Overhead |
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d. |
Actual Direct Materials + Estimated Direct Labor + Estimated Overhead |
17.)Which of the following documents initiates the purchasing of materials?
Answer
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a. |
Purchase order |
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b. |
Receiving report |
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c. |
Job order cost sheet |
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d. |
Purchase requisition |
18.)Overhead costs are not
Answer
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a. |
charged directly to the Finished Goods Inventory account. |
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b. |
allocated to the Work in Process Inventory account. |
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c. |
assigned to specific products. |
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d. |
considered product costs. |
19.)In a manufacturing environment, costs of materials initially flow
Answer
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a. |
into the Work in Process Inventory account. |
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b. |
directly to Cost of Goods Sold. |
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c. |
into the Finished Goods Inventory account. |
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d. |
into the Materials Inventory account. |
20.)In which one of the following accounts would all three product costs not be found?
Answer
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a. |
Cost of Goods Sold |
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b. |
Finished Goods Inventory |
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c. |
Work in Process Inventory |
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d. |
Materials Inventory |
21.)To reconcile total manufacturing costs with the total cost of goods manufactured during the period,
Answer
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a. |
add beginning and subtract ending finished goods inventory to total manufacturing costs. |
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b. |
you must know how many goods were sold during the period. |
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c. |
add beginning and subtract ending work in process inventory to total manufacturing costs. |
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d. |
subtract out all period costs from total manufacturing costs to arrive at cost of goods manufactured. |
22.)The presentation of merchandise inventory and cost of goods sold in the financial statements of merchandising companies most nearly resembles the presentation of __________ inventory and cost of goods sold in the financial statements of manufacturing companies.
Answer
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a. |
materials |
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b. |
finished goods |
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c. |
work in process |
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d. |
manufacturing supplies |
23.)The beginning finished goods inventory for Boston Co. was $401,050. Goods completed during the year were costed at $783,700. The ending finished goods inventory was dangerously low, having been reduced to $127,700. The cost of goods sold for the year for Boston Co. was
Answer
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a. |
$656,000. |
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b. |
$1,057,050. |
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c. |
$928,600. |
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d. |
$800,150. |
24.)Which of the following represents the overhead applied to a product?
Answer
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a. |
Predetermined Overhead Rate´Estimated Cost Driver Level |
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b. |
Actual Overhead Rate´Actual Cost Driver Level |
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c. |
Actual Overhead Rate´Estimated Cost Driver Level |
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d. |
Predetermined Overhead Rate´Actual Cost Driver Level |
25.)If the estimated cost driver level is overstated, the
Answer
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a. |
predetermined overhead rate will be overstated. |
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b. |
product cost will be overstated. |
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c. |
predetermined overhead rate will be understated. |
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d. |
cost pool will be understated. |
26.)Which of the following results in a predetermined overhead rate?
Answer
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a. |
Estimated overhead divided by estimated units produced |
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b. |
Estimated overhead divided by actual direct labor hours |
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c. |
Actual units produced divided by estimated overhead |
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d. |
Estimated direct labor dollars divided by estimated overhead |
27.)If overhead is applied on the basis of direct labor hours, and actual hours worked are less than budgeted, which of the following is true, assuming estimated overhead is correct?
Answer
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a. |
Overhead is probably overapplied. |
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b. |
Overhead is probably underapplied. |
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c. |
Applied overhead and actual overhead are equal. |
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d. |
None of these is true. |
28.)The following information was taken from the cost records of the Krameer Company:
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Estimated overhead |
$180,000 |
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Actual overhead |
$178,000 |
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Estimated direct labor hours |
24,000 |
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Actual direct labor hours |
25,000 |
If overhead is applied based on direct labor hours, the company’s overapplied or underapplied overhead was
Answer
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a. |
$2,000 underapplied. |
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b. |
$2,000 overapplied. |
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c. |
$9,500 overapplied. |
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d. |
$9,500 underapplied. |
29.)Sleney Company applies overhead on the basis of direct labor dollars, using a rate of $1.65 per labor dollar. How much overhead would be applied to products in January if $18,600 of labor costs were incurred and 2,200 labor hours were worked?
Answer
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a. |
$40,920 |
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b. |
$30,690 |
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c. |
$18,600 |
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d. |
$3,630 |
30.)The numbers of vendors, products, and engineering change orders are examples of
Answer
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a. |
potential cost drivers. |
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b. |
beneficial relationships. |
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c. |
inputs to processing time. |
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d. |
unavoidable overhead costs. |
31.)The type of product costing system used by a company is dictated by the
Answer
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[removed] |
a. |
plant supervisor. |
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[removed] |
b. |
production process. |
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[removed] |
c. |
company president. |
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[removed] |
d. |
project manager. |
32.)Which of the following is not an objective of product costing systems?
Answer
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[removed] |
a. |
To assist in the preparation of the income statement |
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[removed] |
b. |
To determine the optimal amount of products to manufacture |
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[removed] |
c. |
To provide information for product pricing |
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[removed] |
d. |
To provide information for cost planning |
33.)Which of the following is not a characteristic of a job order costing system?
Answer
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[removed] |
a. |
Measures costs for a set time period |
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[removed] |
b. |
Assigns costs to specific batches of products |
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[removed] |
c. |
Uses only one Work in Process Inventory account |
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[removed] |
d. |
Uses job cost cards to keep track of each job in process |
34.)Which of the following products probably would be manufactured using a job order costing system?
Answer
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[removed] |
a. |
Paper |
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[removed] |
b. |
Company business cards |
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[removed] |
c. |
Computer monitors |
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[removed] |
d. |
Baseball |
35.)Which of the following accurately describes a difference between job order and process costing systems?
Answer
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[removed] |
a. |
Since costs are assigned to products in a job order costing system, selling costs are treated as product costs in the job order costing system, whereas they are treated as period costs in process costing systems. |
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[removed] |
b. |
In job order costing systems, costs are traced to products, whereas in process costing systems, costs are traced to processes, departments and work cells. |
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[removed] |
c. |
Job order costing systems do not need to assign costs to production, whereas process costing systems do. |
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[removed] |
d. |
In job order costing systems, overhead costs are treated as product costs, whereas in process costing systems, overhead costs are treated as period costs. |
36.)When the amount of overhead applied differs from actual, the dollar amount it is usually written off to
Answer
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[removed] |
a. |
Finished Goods Inventory. |
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[removed] |
b. |
Miscellaneous Expense. |
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[removed] |
c. |
Work in Process Inventory. |
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[removed] |
d. |
Cost of Goods Sold. |
37.)If the applied overhead is more than actual overhead, which of the following is part of the entry?
Answer
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[removed] |
a. |
A credit to the Overhead account |
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[removed] |
b. |
A debit to the Cost of Goods Sold account |
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[removed] |
c. |
A debit to the Overhead account |
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[removed] |
d. |
A debit to the Work in Process Inventory account |
38.)Applied overhead exceeds actual overhead when the
Answer
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[removed] |
a. |
Overhead account has a credit balance. |
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[removed] |
b. |
journal entry to account for the difference involves a debit to Cost of Goods Sold. |
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[removed] |
c. |
Overhead account has a debit balance. |
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[removed] |
d. |
company has overspent in the overhead cost area. |
39.)If there is a credit balance in the Factory Payroll Payable at the end of the accounting period, it represents
Answer
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[removed] |
a. |
labor costs which have not yet been distributed. |
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[removed] |
b. |
an amount that should be charged to Cost of Goods Sold. |
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[removed] |
c. |
the amount by which applied payroll was greater than actual payroll. |
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[removed] |
d. |
the amount by which actual payroll was greater than applied payroll. |
40.)The total of the dollar amounts on the job order cost cards that have not been completed would be equal to the
Answer
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[removed] |
a. |
balance in the Finished Goods Inventory account. |
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[removed] |
b. |
balance in the Work in Process Inventory account. |
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[removed] |
c. |
Cost of Goods Sold account. |
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[removed] |
d. |
cost of goods completed. |
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