QUESTION 1
1. Both financial and managerial accounting rely on accepted principles that are enforced
through an extensive set of rules and guidelines.
True
False
1 points
QUESTION 2
1. Direct costs are incurred for the benefit of more than one cost object.
True
False
1 points
QUESTION 3
1. A process cost summary usually does not include the number of equivalent units of
production for the period.
True
False
1 points
QUESTION 4
1. Equivalent units of production are always the same as the total number of physical units
finished during the period.
True
False
1 points
QUESTION 5
1. A major disadvantage of using a plantwide overhead rate is the extreme difficulty in
gathering the needed information.
True
False
1 points
QUESTION 6
1. Activity-based costing often shifts overhead costs from large volume, standardized
products to low-volume, specialty products that consume disproportionate resources.
True
False
1 points
QUESTION 7
1. As the level of volume of activity increases, the variable cost per unit remains constant.
True
False
1 points
QUESTION 8
1. As the volume increases, fixed cost per unit of output remains constant.
True
False
1 points
QUESTION 9
1. A favorable direct materials price variance might lead to an unfavorable direct materials
quantity variance because the company purchased inferior materials.
True
False
1 points
QUESTION 10
1. A variable or flexible budget is so named because it only focuses on variable costs.
True
False
1 points
QUESTION 11
1. Managerial accounting is different from financial accounting in that:
Managerial accounting is more focused on the organization as a whole and financial accounting is more
focused on subdivisions of the organization.
Managerial accounting never includes nonmonetary information.
Managerial accounting includes many projections and estimates whereas financial accounting has a
minimum of predictions.
Managerial accounting is used extensively by investors, whereas financial accounting is used only by
creditors.
Managerial accounting is mainly used to set stock prices.
1 points
QUESTION 12
1. A direct cost is a cost that is:
Identifiable as controllable.
Traceable to the company as a whole.
Does not change with the volume of activity.
Traceable to a single cost object.
Traceable to multiple cost objects.
1 points
QUESTION 13
1. 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:
Continuous improvement.
Customer orientation.
Just-in-time manufacturing.
Theory of constraints.
Total quality management.
1 points
QUESTION 14
1. Product costs:
Are expenditures necessary and integral to finished products.
Are expenditures identified more with a time period rather than with units of product.
Include selling and administrative expenses.
Are expensed on the income statement when incurred.
Are moved to the income statement for any unsold inventory at the end of the year.
1 points
QUESTION 15
1. A manufacturing company has a beginning finished goods inventory of $14,600, raw
material purchases of $18,000, cost of goods manufactured of $32,500, and an ending
finished goods inventory of $17,800. The cost of goods sold for this company is:
$21,200
$29,300
$32,500
$47,100
$27,600
1 points
QUESTION 16
1. A job order costing system would best fit the needs of a company that makes:
1 points
QUESTION 17
1. Adams Manufacturing allocates overhead to production on the basis of direct labor costs. At the beginning of
the year, Adams estimated total overhead of $396,000; materials of $410,000 and direct labor of $220,000.
During the year Adams incurred $418,000 in materials costs, $413,200 in overhead costs and $224,000 in
direct labor costs. Compute the amount of under- or overapplied overhead for the year.
$10,000 overapplied.
$17,200 overapplied.
$10,000 underapplied.
$17,200 underapplied.
$4,800 underapplied.
$5,000.