1. Which of the following costs is considered an indirect cost to its given cost...
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1. Which of the following costs is considered an indirect cost to its given cost object? a. New plumbing system for a house b. An operation for a family pet c. Rent in a yearly budget d. Wax glaze for an apple e. Cleaning services for an office 2. Toshiba adds completed transformers to their televisions during assembly. The transformers would be considered what types of cost? a. Variable cost and product cost b. Fixed cost and product cost c. Fixed cost and period cost d. Mixed cost and product cost e. Variable cost and period cost 3. What value would be debited to the left side of the finished goods inventory T-Account? a. Manufacturing Overhead b. Cost of Goods Manufactured c. Cost of Goods Sold d. Materials Used in Production e. Indirect Materials 4. Which of the following describes how costs behave when production activity decreases within the relevant range? a. Variable cost per unit increases and total fixed costs remain constant b. Fixed cost per unit increases and total variable cost decreases c. Total cost increases and fixed cost per unit remains constant d. Fixed cost per unit decreases and variable cost per unit remains constant e. Total cost decreases and variable cost per unit increases 5. Quixotic Industries is considering a transition in their factory from manufacturing A-types (which they currently manufacture) to B-types, which they have not previously manufactured. What costs should be considered? a. Lab tests conducted prior to manufacturing A-types b. Salary to factory foreperson, who would oversee either type of production c. Factory changes to accommodate production of B-types d. Selling expenses for remaining A-types e. None of the above 6. Direct Labor is considered which type(s) of cost (circle/write all that apply)? a. Period b. Product c. Prime d. Conversion e. Non-Inventorial 7. A mixed cost, when graphed for activity, would generally have which of the following traits? a. Straight line starting at 0 b. Curved line starting at 0 c. Straight line starting above 0 d. Curved line starting above 0 e. None of the above 8. Activity-based costing would make the most sense to use in which of the following circumstances? a. The company makes multiple lines of products requiring different processes, and applies MOH differently in different processing departments. b. The company makes one product and assigns MOH differently to different departments. c. The company makes multiple products, and uses a plantwide applied MOH d. The company makes one product and uses a plantwide MOH e. None of the above 9. Which of the following calculations would NOT equal Contribution Margin? (FE = total Fixed Expenses, VE = total Variable Expenses, CMR= Contribution Margin Ratio) a. Profit + FE b. CMR x Sales c. Breakeven Sales - FE d. Sales - VE e. Sales x CM per unit/Sales price per unit 10. Which one of the following could be used (by itself) to determine what percent of sales is not variable expenses? a. Degree of Operating Leverage b. Breakeven Sales c. Margin of safety % d. Contribution margin/Unit e. None of the above 11. Goliath Incorporated applies manufacturing overhead on the basis of direct labor hours. At the beginning of 2017, the cost accountant estimated the following information for the year: Total direct labor hours 2,000 Total direct labor cost $80,600 Total direct materials cost $150,750 Total machine hours 7,100 Total manufacturing overhead cost $50,200 At the end of 2017, the cost accountant noted that actual direct labor hours incurred was 2,300, total direct labor cost was $87,200 and actual manufacturing overhead incurred was $60,800 during the year. Was manufacturing overhead under-applied or over-applied and by how much? PdOR = 50,200 (est MOH)/ 2000 (DLH base) = $25.10/DLH Actual hours x PdOR = 2,300 x 25.10 = 57,730 Applied Overhead 60,800 MOH incurred 57,730 Applied Overhead = 3,070 Underapplied Use the following information for Questions 12-14: Futility Utility Co. applies manufacturing overhead to jobs on the basis of direct labor cost. At the beginning of the month, the estimated manufacturing overhead was $45,000 and the estimated direct labor cost was $36,000. During March, the following transactions were recorded by the company: Raw materials: Purchased $41,000 Used (80% direct materials) $45,000 Labor: Direct labor hours worked 3,500 Direct labor cost incurred $38,500 Indirect labor cost incurred $9,500 Manufacturing overhead costs incurred (total) $47,000 Inventories: Raw materials, 3/1 $12,000 Work in process, 3/1 $14,500 Work in process 3/31 $16,000 Finished Goods 3/31 $6,000 12. Compute the predetermined overhead rate for the month of March (make sure to label the units). Est MOH/Est DL$ = 45,000/36,000 = $1.25 per DL$ 13. Cost of Goods Manufactured for the month was: Work in Process BB 14,500 DM 36,000 DL 38,500 MOH 48,125 COGM 121,125 EB 16,000 DM = 80% (45,000) = 36,000 DL = 38,500 (given) MOH = PdOR x DL$ 1.25 x 38,500 = 48,125 14. The actual manufacturing overhead incurred included $__________ not related to indirect labor or indirect materials. 47,000 total MOH incurred -9,000 Indirect materials (20% of 45,000) -9,500 Indirect labor (given) $28,500 remaining MOH 1. Which of the following costs is considered an indirect cost to its given cost object? a. New plumbing system for a house b. An operation for a family pet c. Rent in a yearly budget d. Wax glaze for an apple e. Cleaning services for an office 2. Toshiba adds completed transformers to their televisions during assembly. The transformers would be considered what types of cost? a. Variable cost and product cost b. Fixed cost and product cost c. Fixed cost and period cost d. Mixed cost and product cost e. Variable cost and period cost 3. What value would be debited to the left side of the finished goods inventory T-Account? a. Manufacturing Overhead b. Cost of Goods Manufactured c. Cost of Goods Sold d. Materials Used in Production e. Indirect Materials 4. Which of the following describes how costs behave when production activity decreases within the relevant range? a. Variable cost per unit increases and total fixed costs remain constant b. Fixed cost per unit increases and total variable cost decreases c. Total cost increases and fixed cost per unit remains constant d. Fixed cost per unit decreases and variable cost per unit remains constant e. Total cost decreases and variable cost per unit increases 5. Quixotic Industries is considering a transition in their factory from manufacturing A-types (which they currently manufacture) to B-types, which they have not previously manufactured. What costs should be considered? a. Lab tests conducted prior to manufacturing A-types b. Salary to factory foreperson, who would oversee either type of production c. Factory changes to accommodate production of B-types d. Selling expenses for remaining A-types e. None of the above 6. Direct Labor is considered which type(s) of cost (circle/write all that apply)? a. Period b. Product c. Prime d. Conversion e. Non-Inventorial 7. A mixed cost, when graphed for activity, would generally have which of the following traits? a. Straight line starting at 0 b. Curved line starting at 0 c. Straight line starting above 0 d. Curved line starting above 0 e. None of the above 8. Activity-based costing would make the most sense to use in which of the following circumstances? a. The company makes multiple lines of products requiring different processes, and applies MOH differently in different processing departments. b. The company makes one product and assigns MOH differently to different departments. c. The company makes multiple products, and uses a plantwide applied MOH d. The company makes one product and uses a plantwide MOH e. None of the above 9. Which of the following calculations would NOT equal Contribution Margin? (FE = total Fixed Expenses, VE = total Variable Expenses, CMR= Contribution Margin Ratio) a. Profit + FE b. CMR x Sales c. Breakeven Sales - FE d. Sales - VE e. Sales x CM per unit/Sales price per unit 10. Which one of the following could be used (by itself) to determine what percent of sales is not variable expenses? a. Degree of Operating Leverage b. Breakeven Sales c. Margin of safety % d. Contribution margin/Unit e. None of the above 11. Goliath Incorporated applies manufacturing overhead on the basis of direct labor hours. At the beginning of 2017, the cost accountant estimated the following information for the year: Total direct labor hours 2,000 Total direct labor cost $80,600 Total direct materials cost $150,750 Total machine hours 7,100 Total manufacturing overhead cost $50,200 At the end of 2017, the cost accountant noted that actual direct labor hours incurred was 2,300, total direct labor cost was $87,200 and actual manufacturing overhead incurred was $60,800 during the year. Was manufacturing overhead under-applied or over-applied and by how much? PdOR = 50,200 (est MOH)/ 2000 (DLH base) = $25.10/DLH Actual hours x PdOR = 2,300 x 25.10 = 57,730 Applied Overhead 60,800 MOH incurred 57,730 Applied Overhead = 3,070 Underapplied Use the following information for Questions 12-14: Futility Utility Co. applies manufacturing overhead to jobs on the basis of direct labor cost. At the beginning of the month, the estimated manufacturing overhead was $45,000 and the estimated direct labor cost was $36,000. During March, the following transactions were recorded by the company: Raw materials: Purchased $41,000 Used (80% direct materials) $45,000 Labor: Direct labor hours worked 3,500 Direct labor cost incurred $38,500 Indirect labor cost incurred $9,500 Manufacturing overhead costs incurred (total) $47,000 Inventories: Raw materials, 3/1 $12,000 Work in process, 3/1 $14,500 Work in process 3/31 $16,000 Finished Goods 3/31 $6,000 12. Compute the predetermined overhead rate for the month of March (make sure to label the units). Est MOH/Est DL$ = 45,000/36,000 = $1.25 per DL$ 13. Cost of Goods Manufactured for the month was: Work in Process BB 14,500 DM 36,000 DL 38,500 MOH 48,125 COGM 121,125 EB 16,000 DM = 80% (45,000) = 36,000 DL = 38,500 (given) MOH = PdOR x DL$ 1.25 x 38,500 = 48,125 14. The actual manufacturing overhead incurred included $__________ not related to indirect labor or indirect materials. 47,000 total MOH incurred -9,000 Indirect materials (20% of 45,000) -9,500 Indirect labor (given) $28,500 remaining MOH
1. Which of the following costs is considered an indirect cost to its given cost object?
a. New plumbing system for a house
b. An operation for a family pet
c. Rent in a yearly budget
d. Wax glaze for an apple
e. Cleaning services for an office
2. Toshiba adds completed transformers to their televisions during assembly. The transformers would be considered what types of cost?
a. Variable cost and product cost
b. Fixed cost and product cost
c. Fixed cost and period cost
d. Mixed cost and product cost
e. Variable cost and period cost
3. What value would be debited to the left side of the finished goods inventory T-Account?
a. Manufacturing Overhead
b. Cost of Goods Manufactured
c. Cost of Goods Sold
d. Materials Used in Production
e. Indirect Materials
4. Which of the following describes how costs behave when production activity decreases within the relevant range?
a. Variable cost per unit increases and total fixed costs remain constant
b. Fixed cost per unit increases and total variable cost decreases
c. Total cost increases and fixed cost per unit remains constant
d. Fixed cost per unit decreases and variable cost per unit remains constant
e. Total cost decreases and variable cost per unit increases
5. Quixotic Industries is considering a transition in their factory from manufacturing A-types (which they currently manufacture) to B-types, which they have not previously manufactured. What costs should be considered?
a. Lab tests conducted prior to manufacturing A-types
b. Salary to factory foreperson, who would oversee either type of production
c. Factory changes to accommodate production of B-types
d. Selling expenses for remaining A-types
e. None of the above
6. Direct Labor is considered which type(s) of cost (circle/write all that apply)?
a. Period
b. Product
c. Prime
d. Conversion
e. Non-Inventorial
7. A mixed cost, when graphed for activity, would generally have which of the following traits?
a. Straight line starting at 0
b. Curved line starting at 0
c. Straight line starting above 0
d. Curved line starting above 0
e. None of the above
8. Activity-based costing would make the most sense to use in which of the following circumstances?
a. The company makes multiple lines of products requiring different processes, and applies MOH differently in different processing departments.
b. The company makes one product and assigns MOH differently to different departments.
c. The company makes multiple products, and uses a plantwide applied MOH
d. The company makes one product and uses a plantwide MOH
e. None of the above
9. Which of the following calculations would NOT equal Contribution Margin? (FE = total Fixed Expenses, VE = total Variable Expenses, CMR= Contribution Margin Ratio)
a. Profit + FE
b. CMR x Sales
c. Breakeven Sales - FE
d. Sales - VE
e. Sales x CM per unit/Sales price per unit
10. Which one of the following could be used (by itself) to determine what percent of sales is not variable expenses?
a. Degree of Operating Leverage
b. Breakeven Sales
c. Margin of safety %
d. Contribution margin/Unit
e. None of the above
11. Goliath Incorporated applies manufacturing overhead on the basis of direct labor hours. At the beginning of 2017, the cost accountant estimated the following information for the year:
Total direct labor hours 2,000
Total direct labor cost $80,600
Total direct materials cost $150,750
Total machine hours 7,100
Total manufacturing overhead cost $50,200
At the end of 2017, the cost accountant noted that actual direct labor hours incurred was 2,300, total direct labor cost was $87,200 and actual manufacturing overhead incurred was $60,800 during the year. Was manufacturing overhead under-applied or over-applied and by how much?
PdOR = 50,200 (est MOH)/ 2000 (DLH base) = $25.10/DLH
Actual hours x PdOR = 2,300 x 25.10 = 57,730 Applied Overhead
60,800 MOH incurred 57,730 Applied Overhead = 3,070 Underapplied
Use the following information for Questions 12-14:
Futility Utility Co. applies manufacturing overhead to jobs on the basis of direct labor cost. At the beginning of the month, the estimated manufacturing overhead was $45,000 and the estimated direct labor cost was $36,000. During March, the following transactions were recorded by the company:
Raw materials:
Purchased $41,000
Used (80% direct materials) $45,000
Labor:
Direct labor hours worked 3,500
Direct labor cost incurred $38,500
Indirect labor cost incurred $9,500
Manufacturing overhead costs incurred (total) $47,000
Inventories:
Raw materials, 3/1 $12,000
Work in process, 3/1 $14,500
Work in process 3/31 $16,000
Finished Goods 3/31 $6,000
12. Compute the predetermined overhead rate for the month of March (make sure to label the units).
Est MOH/Est DL$ = 45,000/36,000 = $1.25 per DL$
13. Cost of Goods Manufactured for the month was:
Work in Process
BB 14,500
DM 36,000
DL 38,500
MOH 48,125
COGM 121,125
EB 16,000
DM = 80% (45,000) = 36,000 DL = 38,500 (given) MOH = PdOR x DL$ 1.25 x 38,500 = 48,125
14. The actual manufacturing overhead incurred included $__________ not related to indirect labor or indirect materials.
47,000 total MOH incurred
-9,000 Indirect materials (20% of 45,000)
-9,500 Indirect labor (given)
$28,500 remaining MOH
1. Which of the following costs is considered an indirect cost to its given cost object?
a. New plumbing system for a house
b. An operation for a family pet
c. Rent in a yearly budget
d. Wax glaze for an apple
e. Cleaning services for an office
2. Toshiba adds completed transformers to their televisions during assembly. The transformers would be considered what types of cost?
a. Variable cost and product cost
b. Fixed cost and product cost
c. Fixed cost and period cost
d. Mixed cost and product cost
e. Variable cost and period cost
3. What value would be debited to the left side of the finished goods inventory T-Account?
a. Manufacturing Overhead
b. Cost of Goods Manufactured
c. Cost of Goods Sold
d. Materials Used in Production
e. Indirect Materials
4. Which of the following describes how costs behave when production activity decreases within the relevant range?
a. Variable cost per unit increases and total fixed costs remain constant
b. Fixed cost per unit increases and total variable cost decreases
c. Total cost increases and fixed cost per unit remains constant
d. Fixed cost per unit decreases and variable cost per unit remains constant
e. Total cost decreases and variable cost per unit increases
5. Quixotic Industries is considering a transition in their factory from manufacturing A-types (which they currently manufacture) to B-types, which they have not previously manufactured. What costs should be considered?
a. Lab tests conducted prior to manufacturing A-types
b. Salary to factory foreperson, who would oversee either type of production
c. Factory changes to accommodate production of B-types
d. Selling expenses for remaining A-types
e. None of the above
6. Direct Labor is considered which type(s) of cost (circle/write all that apply)?
a. Period
b. Product
c. Prime
d. Conversion
e. Non-Inventorial
7. A mixed cost, when graphed for activity, would generally have which of the following traits?
a. Straight line starting at 0
b. Curved line starting at 0
c. Straight line starting above 0
d. Curved line starting above 0
e. None of the above
8. Activity-based costing would make the most sense to use in which of the following circumstances?
a. The company makes multiple lines of products requiring different processes, and applies MOH differently in different processing departments.
b. The company makes one product and assigns MOH differently to different departments.
c. The company makes multiple products, and uses a plantwide applied MOH
d. The company makes one product and uses a plantwide MOH
e. None of the above
9. Which of the following calculations would NOT equal Contribution Margin? (FE = total Fixed Expenses, VE = total Variable Expenses, CMR= Contribution Margin Ratio)
a. Profit + FE
b. CMR x Sales
c. Breakeven Sales - FE
d. Sales - VE
e. Sales x CM per unit/Sales price per unit
10. Which one of the following could be used (by itself) to determine what percent of sales is not variable expenses?
a. Degree of Operating Leverage
b. Breakeven Sales
c. Margin of safety %
d. Contribution margin/Unit
e. None of the above
11. Goliath Incorporated applies manufacturing overhead on the basis of direct labor hours. At the beginning of 2017, the cost accountant estimated the following information for the year:
Total direct labor hours 2,000
Total direct labor cost $80,600
Total direct materials cost $150,750
Total machine hours 7,100
Total manufacturing overhead cost $50,200
At the end of 2017, the cost accountant noted that actual direct labor hours incurred was 2,300, total direct labor cost was $87,200 and actual manufacturing overhead incurred was $60,800 during the year. Was manufacturing overhead under-applied or over-applied and by how much?
PdOR = 50,200 (est MOH)/ 2000 (DLH base) = $25.10/DLH
Actual hours x PdOR = 2,300 x 25.10 = 57,730 Applied Overhead
60,800 MOH incurred 57,730 Applied Overhead = 3,070 Underapplied
Use the following information for Questions 12-14:
Futility Utility Co. applies manufacturing overhead to jobs on the basis of direct labor cost. At the beginning of the month, the estimated manufacturing overhead was $45,000 and the estimated direct labor cost was $36,000. During March, the following transactions were recorded by the company:
Raw materials:
Purchased $41,000
Used (80% direct materials) $45,000
Labor:
Direct labor hours worked 3,500
Direct labor cost incurred $38,500
Indirect labor cost incurred $9,500
Manufacturing overhead costs incurred (total) $47,000
Inventories:
Raw materials, 3/1 $12,000
Work in process, 3/1 $14,500
Work in process 3/31 $16,000
Finished Goods 3/31 $6,000
12. Compute the predetermined overhead rate for the month of March (make sure to label the units).
Est MOH/Est DL$ = 45,000/36,000 = $1.25 per DL$
13. Cost of Goods Manufactured for the month was:
Work in Process
BB 14,500
DM 36,000
DL 38,500
MOH 48,125
COGM 121,125
EB 16,000
DM = 80% (45,000) = 36,000 DL = 38,500 (given) MOH = PdOR x DL$ 1.25 x 38,500 = 48,125
14. The actual manufacturing overhead incurred included $__________ not related to indirect labor or indirect materials.
47,000 total MOH incurred
-9,000 Indirect materials (20% of 45,000)
-9,500 Indirect labor (given)
$28,500 remaining MOH
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