Question 1

Samson Company reported total manufacturing costs of $320,000, manufacturing overhead totaling $52,000, and direct materials totaling $64,000. How much is direct labor cost?
A)Cannot be determined from the information provided.
B)$268,000
C)$256,000
D)$204,000

Accepted Answer

The answer of Samson Company reported total manufacturing costs of...

Question 2

Molina Company has beginning and ending work in process inventories of $130,000 and $145,000 respectively.If total manufacturing costs are $680,000, what is the total cost of goods manufactured?
A)$810,000.
B)$825,000.
C)$665,000.
D)$695,000.

Accepted Answer

The answer of Molina Company has beginning and ending work...

Question 3

Given the following data for Mehring Company, compute (A) total manufacturing costs and (B) cost of goods manufactured: $\begin{array}{lrlr}
\text { Direct materials used } & \$ 230,000 & \text { Beginning work in process } & \$ 30,000 \
\text { Direct labor } & 150,000 & \text { Ending work in process } & 15,000 \
\text { Manufacturing overhead } & 255,000 & \text { Beginning finished goods } & 38,000 \
\text { Operating expenses } & 263,000 & \text { Ending finished qoods } & 23,000
\end{array}$

$\begin{array}{lll}&(A)&(B)\
\text { a. } & \$ 620,000 & \$ 650,000 \
\text { b. } & \$ 635,000 & \$ 620,000 \
\text { c. } & \$ 635,000 & \$ 650,000 \
\text { d. } & \$ 650,000 & \$ 665,000
\end{array}$

Accepted Answer

The answer of Given the following data for Mehring Company,...

Question 4

Assuming that the cost of goods manufactured is $3,460,000 compute the cost of goods sold using the following information. $\begin{array}{lll}
\text { Raw materials inventory, January 1 } & 30,000 \
\text { Raw materials inventory, December } 31 & 60,000 \
\text { Work in process, January 1 } & 27,000 \
\text { Work in process, December 31 } & 18,000 \
\text { Finished goods, January 1 } & 60,000 \
\text { Finished goods, December 31 } & 48,000\
\text { Raw materials purchases } & 1,800,000 \
\text { Direct labor } & 890,000 \
\text { Factory utilities } & 225,000 \
\text { Indirect labor } & 75,000 \
\text { Factory depreciation } & 500,000 \
\text { Operating expenses } & 630,000
\end{array}$
A)$3,469,000.
B)$3,412,000.
C)$3,448,000.
D)$3,472,000.

Accepted Answer

The answer of Assuming that the cost of goods manufactured...

Question 5

Costas Company has beginning and ending raw materials inventories of $64,000 and $80,000, respectively.If direct materials used were $310,000, what was the cost of raw materials purchased?
A)$310,000.
B)$330,000.
C)$294,000.
D)$326,000.

Accepted Answer

The cost of raw materials purchased can be calculated using the formula: Cost of Raw Materials Purchased = Direct Materials Used + Ending Raw Materials Inventory - Beginning Raw Materials Inventory. Plugging in the given values: $310,000 + $80,000 - $64,000 = $326,000.

Question 6

Assuming the cost of direct materials used is $1,800,000, compute the total manufacturing costs using the information below. $\begin{array}{lll}
\text { Raw materials inventory, January 1 } & 30,000 \
\text { Raw materials inventory, December } 31 & 60,000 \
\text { Work in process, January 1 } & 27,000 \
\text { Work in process, December 31 } & 18,000 \
\text { Finished goods, January 1 } & 60,000 \
\text { Finished goods, December 31 } & 48,000\
\text { Raw materials purchases } & 1,800,000 \
\text { Direct labor } & 890,000 \
\text { Factory utilities } & 225,000 \
\text { Indirect labor } & 75,000 \
\text { Factory depreciation } & 500,000 \
\text { Operating expenses } & 630,000
\end{array}$
A)$3,490,000.
B)$3,499,000.
C)$3,190,000.
D)$4,120,000.

Accepted Answer

Total manufacturing costs include direct materials used, direct labor, and manufacturing overhead (indirect labor, factory utilities, and factory depreciation). Calculating: $1,800,000 (direct materials) + $890,000 (direct labor) + $225,000 (factory utilities) + $75,000 (indirect labor) + $500,000 (factory depreciation) = $3,490,000.

Question 7

Given the following data for Glennon Company, compute (A) total manufacturing costs and (B) costs of goods manufactured: $\begin{array}{lrlr}
\text { Direct materials used } & \$ 270,000 & \text { Beginning work in process } & \$ 40,000 \
\text { Direct labor } & 200,000 & \text { Ending work in process } & 20,000 \
\text { Manufacturing overhead } & 250,000 & \text { Beginning finished goods } & 50,000 \
\text { Operating expenses } & 350,000 & \text { Ending finished goods } & 30,000
\end{array}$

$\begin{array}{lll}&(A)&(B)\
\text { a. } & \$ 700,000 & \$ 740,000 \
\text { b. } & \$ 720,000 & \$ 700,000 \
\text { c. } & \$ 720,000 & \$ 740,000 \
\text { d. } & \$ 740,000 & \$ 760,000
\end{array}$

Accepted Answer

The answer of Given the following data for Glennon Company,...

Question 8

Barton Company has beginning work in process inventory of $144,000 and total manufacturing costs of $686,000.If cost of goods manufactured is $660,000, what is the cost of the ending work in process inventory?
A)$150,000.
B)$118,000.
C)$190,000.
D)$170,000.

Accepted Answer

Using the formula:

Cost of Goods Manufactured = Beginning Work in Process Inventory + Total Manufacturing Costs - Ending Work in Process Inventory

We can solve for the Ending Work in Process Inventory:

Ending Work in Process Inventory = Beginning Work in Process Inventory + Total Manufacturing Costs - Cost of Goods Manufactured

Ending Work in Process Inventory = $144,000 + $686,000 - $660,000

Ending Work in Process Inventory = $170,000

Therefore, the cost of the ending work in process inventory is $170,000. The correct answer is D.

Question 9

Wood Company has beginning work in process inventory of $138,000 and total manufacturing costs of $477,000.If cost of goods manufactured is $480,000, what is the cost of the ending work in process inventory?
A)$120,000.
B)$141,000.
C)$150,000.
D)$135,000.

Accepted Answer

Cost of goods manufactured = Total manufacturing costs + Beginning work in process inventory - Ending work in process inventory
$480,000 = $477,000 + $138,000 - Ending work in process inventory

Rearranging the equation, we get:

Ending work in process inventory = $477,000 + $138,000 - $480,000
Ending work in process inventory = $135,000

Therefore, the cost of the ending work in process inventory is $135,000, which corresponds to choice D.

Question 10

What term describes all business processes associated with providing a product or service?
A)The manufacturing chain
B)The product chain
C)The supply chain
D)The value chain

Accepted Answer

The term that describes all business processes associated with providing a product or service is the value chain. The value chain includes all activities from the creation of the product or service through to its delivery to the customer, including research and development, production or service delivery, marketing and sales, and after-sales support. This concept was first introduced by Michael Porter in his book "Competitive Advantage: Creating and Sustaining Superior Performance."

Question 11

Which one of the following characteristics would likely be associated with a just-in-time inventory method?
A)Ending inventory of work in process that would allow several production runs
B)A backlog of inventory orders not yet shipped
C)Minimal finished goods inventory on hand
D)An understanding with customers that they may come to the showroom and select from inventory on hand

Accepted Answer

Just-in-time inventory is a philosophy that strives to minimize inventory levels to reduce waste and increase efficiency. Therefore, minimal finished goods inventory on hand would be a characteristic associated with a just-in-time inventory method.

Question 12

Given the following data for Harder Company, compute cost of goods manufactured: $$\begin{array} { l r l r } 
\text { Direct materials used } & \$ 120,000 & \text { Beginning work in process } & \$ 20,000 \
\text { Direct labor } & 200,000 & \text { Ending work in process } & 10,000 \
\text { Manufacturing overhead } & 180,000 & \text { Beginning finished goods } & 25,000 \
\text { Operating expenses } & 175,000 & \text { Ending finished goods } & 15,000
\end{array}$$
A)$490,000
B)$500,000
C)$510,000
D)$520,000

Accepted Answer

The answer of Given the following data for Harder Company,...

Question 13

Which one of the following managerial accounting approaches attempts to allocate manufacturing overhead in a more meaningful fashion?
A)Balanced scorecard
B)Just-in-time inventory
C)Activity-based costing
D)Total quality management

Accepted Answer

Activity-based costing attempts to allocate manufacturing overhead in a more meaningful fashion by assigning costs to specific activities, rather than using a general overhead rate. This can provide more accurate information on the true cost of manufacturing a product or providing a service. Balanced scorecard, just-in-time inventory, and total quality management are other managerial accounting approaches, but they do not specifically focus on the allocation of manufacturing overhead.

Question 14

Penner Company reported total manufacturing costs of $450,000, manufacturing overhead totaling $78,000, and direct materials totaling $96,000.How much is direct labor cost?
A)Cannot be determined from the information provided.
B)$624,000
C)$354,000
D)$276,000

Accepted Answer

Direct labor cost can be found by subtracting manufacturing overhead and direct materials from total manufacturing costs, as direct labor cost represents the remaining costs associated with producing the goods. Thus, direct labor cost = total manufacturing costs – manufacturing overhead – direct materials = $450000 – $78000 – $96000 = $276000.

Question 15

How have many companies significantly lowered inventory levels and costs?
A)They use activity-based costing.
B)They utilize a balanced scorecard system.
C)They have a just-in-time method.
D)They focus on total quality management.

Accepted Answer

Many companies have significantly lowered inventory levels and costs by utilizing the just-in-time method, which involves receiving goods only as they are needed in the production process, thus reducing the need for excess inventory.

Question 16

The equivalent of finished goods inventory for a merchandising firm is referred to as
A)purchases.
B)cost of goods purchased.
C)inventory.
D)raw materials inventory.

Accepted Answer

For a merchandising firm, inventory represents the finished goods available for sale. Option A, purchases, refers to the amount of products a merchandiser has bought from its suppliers, but it doesn't necessarily mean those products are ready for sale. Option B, cost of goods purchased, is the total cost of those products bought during an accounting period, including freight and taxes. Option D, raw materials inventory, pertains to manufacturing companies that purchase raw materials to create products.

Question 17

Which one of the following does not appear on the balance sheet of a manufacturing company?
A)Finished goods inventory
B)Work in process inventory
C)Cost of goods manufactured
D)Raw materials inventory

Accepted Answer

Cost of goods manufactured is not a specific inventory item and is instead a calculation that appears on the income statement to show the total cost incurred in production during a particular accounting period. Finished goods inventory, work in process inventory, and raw materials inventory are all balance sheet items that represent specific stages of the manufacturing process.

Question 18

Gammil Company has beginning and ending raw materials inventories of $96,000 and $120,000, respectively.If direct materials used were $490,000, what was the cost of raw materials purchased?
A)$490,000.
B)$520,000.
C)$466,000.
D)$514,000.

Accepted Answer

Cost of Raw Materials Purchased = Ending Raw Materials Inventory - Beginning Raw Materials Inventory + Direct Materials Used
= $120,000 - $96,000 + $490,000
= $514,000.

Therefore, the correct answer is D: $514,000.

Question 19

What is "balanced" in the balanced scorecard approach?
A)The number of products produced
B)The emphasis on financial and non-financial performance measurements
C)The amount of costs allocated to products
D)The number of defects found on each product

Accepted Answer

The balanced scorecard approach emphasizes both financial and non-financial performance measurements to provide a balanced view of an organization's performance. The other choices do not relate to the balanced scorecard approach.

Question 20

Assuming that the total manufacturing costs are $3,400,000, compute the cost of goods manufactured using the information below. $\begin{array}{lll}
\text { Raw materials inventory, January 1 } & 30,000 \
\text { Raw materials inventory, December } 31 & 60,000 \
\text { Work in process, January 1 } & 27,000 \
\text { Work in process, December 31 } & 18,000 \
\text { Finished goods, January 1 } & 60,000 \
\text { Finished goods, December 31 } & 48,000\
\text { Raw materials purchases } & 1,800,000 \
\text { Direct labor } & 890,000 \
\text { Factory utilities } & 225,000 \
\text { Indirect labor } & 75,000 \
\text { Factory depreciation } & 500,000 \
\text { Operating expenses } & 630,000
\end{array}$
A)$3,421,000.
B)$3,391,000.
C)$3,409,000.
D)$3,142,000.

Accepted Answer

The cost of goods manufactured is calculated as: Total manufacturing costs ($3,400,000) + Beginning work in process ($27,000) - Ending work in process ($18,000) = $3,409,000.

Quiz 1: Introduction to Financial Statements

Samson Company reported total manufacturing costs of $320,000, manufacturing overhead totaling $52,000, and direct materials totaling $64,000. How much is direct labor cost?

Molina Company has beginning and ending work in process inventories of $130,000 and $145,000 respectively.If total manufacturing costs are $680,000, what is the total cost of goods manufactured?

Costas Company has beginning and ending raw materials inventories of $64,000 and $80,000, respectively.If direct materials used were $310,000, what was the cost of raw materials purchased?

Barton Company has beginning work in process inventory of $144,000 and total manufacturing costs of $686,000.If cost of goods manufactured is $660,000, what is the cost of the ending work in process inventory?

Wood Company has beginning work in process inventory of $138,000 and total manufacturing costs of $477,000.If cost of goods manufactured is $480,000, what is the cost of the ending work in process inventory?

What term describes all business processes associated with providing a product or service?

Which one of the following characteristics would likely be associated with a just-in-time inventory method?

Which one of the following managerial accounting approaches attempts to allocate manufacturing overhead in a more meaningful fashion?

Penner Company reported total manufacturing costs of $450,000, manufacturing overhead totaling $78,000, and direct materials totaling $96,000.How much is direct labor cost?

How have many companies significantly lowered inventory levels and costs?

The equivalent of finished goods inventory for a merchandising firm is referred to as

Which one of the following does not appear on the balance sheet of a manufacturing company?

Gammil Company has beginning and ending raw materials inventories of $96,000 and $120,000, respectively.If direct materials used were $490,000, what was the cost of raw materials purchased?

What is "balanced" in the balanced scorecard approach?