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116. Cost of goods sold
a. represents all costs associated with research, development, and general administration of the organization.
b. is found on the Balance Sheet.
c. is the cost of the partially completed goods that are still on the factory floor at the end of the period.
d. is the total product cost for the units sold during a period.
117. Which of the following would not be found on the income statement of a manufacturer?
a. cost of goods sold
b. work in process
c. sales revenue
d. operating income
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118. Which of the following would be found on the balance sheet of a manufacturer?
a. work in process
b. raw materials
c. finished goods
d. All of the these are correct
119. Which of the following would be found on the balance sheet of a manufacturer?
a. sales revenue
b. selling expenses
c. factory equipment
d. all of these are correct
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120. Gross margin equals
a. cost of goods sold − selling and administrative expenses.
b. direct materials + direct labor + manufacturing overhead.
c. sales revenue − cost of goods sold.
d. cost of goods manufactured + selling and administrative expenses.
121. Operating income equals
a. sales revenue − cost of goods sold − selling and administrative expense
b. gross margin − selling expenses
c. sales revenue − cost of goods sold
d. sales revenue − selling and administrative expenses
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122. Gross margin percent equals
a. gross margin/cost of goods sold.
b. operating income/sales revenue.
c. gross margin/sales revenue.
d. sales revenue/gross margin.
123. Which of the following would not be found on an income statement of a service organization?
a. selling expenses
b. cost of goods sold
c. operating income
d. sales revenue
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124. Which of the following can be found on the income statements of both a manufacturing and service organization?
a. revenues
b. operating income
c. administrative expenses
d. all of these can be found on both.
125. A manufacturer normally has
a. one inventory account.
b. four inventory accounts.
c. three inventory accounts.
d. none of these are correct.
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126. An income statement of a manufacturer
a. will show the ending balance of work in process.
b. contains only manufacturing costs.
c. will show the ending balance of materials inventory.
d. covers a certain period of time.
127. On a manufacturer’s income statement expenses are separated into the following three categories:
a. production, period, and indirect
b. materials, work in process, and finished goods
c. production, selling, and administrative
d. variable, fixed, and direct
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128. Hendrix & Franks Company had the following beginning and ending inventory balances for the current year ended
December 31:
January 1 December 31
Materials $11,000 $ 8,800
Work in Process 19,800 18,700
Finished Goods 23,100 18,150
In addition, direct labor costs of $33,000 were incurred, manufacturing overhead equaled $46,200, materials purchased
were $29,700, and selling and administrative costs were $24,200. Hendrix & Franks Co. sold 27,500 units of product
during the year at a sales price of $5.25 per unit. What was the amount of cost of goods manufactured for the year?
a. $101,000
b. $124,000
c. $100,000
d. $112,200
129. Hendrix & Franks Company had the following beginning and ending inventory balances for the current year ended
December 31:
January 1 December 31
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Materials $11,000 $ 8,800
Work in Process 19,800 18,700
Finished Goods 23,100 18,150
In addition, direct labor costs of $33,000 were incurred, manufacturing overhead equaled $46,200, materials purchased
were $29,700, and selling and administrative costs were $24,200. Hendrix & Franks Co. sold 27,500 units of product
during the year at a sales price of $5.25 per unit. What was the amount of cost of goods sold for the year?
a. $102,000
b. $97,500
c. $117,150
d. $128,500
130. Hendrix & Franks Company had the following beginning and ending inventory balances for the current year ended
December 31:
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January 1 December 31
Materials $11,000 $ 8,800
Work in Process 19,800 18,700
Finished Goods 23,100 18,150
In addition, direct labor costs of $33,000 were incurred, manufacturing overhead equaled $46,200, materials purchased
were $29,700, and selling and administrative costs were $24,200. Hendrix & Franks Co. sold 27,500 units of product
during the year at a sales price of $5.25 per unit. What were the total manufacturing costs for the year?
a. $111,100
b. $102,000
c. $123,000
d. $106,500
131. Hendrix & Franks Co. had the following beginning and ending inventory balances for the current year ended
December 31:
January 1 December 31
Materials $11,000 $ 8,800
Work in Process 19,800 18,700
Finished Goods 23,100 18,150
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In addition, direct labor costs of $33,000 were incurred, manufacturing overhead equaled $46,200, materials purchased
were $29,700, and selling and administrative costs were $24,200. Hendrix & Franks Co. sold 27,500 units of product
during the year at a sales price of $5.25 per unit. What was the operating income (loss) for the year?
a. $18,500
b. $125,000
c. $3,025
d. $2,000
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132. During the month of June, Carney & Whitley Inc. had cost of goods manufactured of $123,200, direct materials cost
of $57,200, direct labor cost of $40,700, and manufacturing overhead cost of $28,600. The work in process balance on
June 30 was equal to $11,000. What was the work in process balance on June 1?
a. $7,700
b. $13,000
c. $10,000
d. $115,000
133. Emarson & Slater Inc. had materials inventory of $13,200 on July 1. The materials inventory on July 31 was $16,500
and the cost of direct materials used in production was $22,000. What was the cost of materials purchased during the
month?
a. $25,300
b. $17,000
c. $35,000
d. $20,000
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134. Rocha & Noel Inc. had cost of goods sold of $123,200 for the current year ended December 31. The finished goods
inventory on January 1 was $30,800, and the finished goods inventory on December 31 was $18,700. What was the
amount of cost of goods manufactured for the year?
a. $129,000
b. $111,100
c. $67,000
d. $113,000
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135. Thomas & Cooke Inc. had a gross margin for the month of February totaling $46,200. They sold 5,500 units during
the month at a sales price of $22 per unit. What was the amount of cost of goods sold for the month?
a. $100,000
b. $42,000
c. $74,800
d. None of these are correct.
136. Wright & Boyle Inc. had the following income statement for the month of May:
Sales revenue $ 470,800.00
Cost of goods sold 217,766.40
Gross margin $ 253,033.60
Less:
Selling expenses $ 86,199.20
Administrative expenses 74,942.80
Operating income $ 91,891.60
What was the sales revenue percent?
a. 100%
b. 48%
c. 52%
d. 16%
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137. Wright & Boyle Inc. had the following income statement for the month of May:
Sales revenue $470,800.00
Cost of goods sold 217,766.40
Gross margin $253,033.60
Less:
Selling expenses $ 86,199.20
Administrative expenses 74,942.80
Operating income $ 91,891.60
What was the cost of goods sold percent? (Note: Round answer to two decimal places.)
a. 100.51%
b. 19.45%
c. 52.56%
d. 46.25%
138. Wright & Boyle Inc. had the following income statement for the month of May:
Sales revenue $470,800.00
Cost of goods sold 217,766.40
Gross margin $253,033.60
Less:
Selling expenses $ 86,199.20
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Administrative expenses 74,942.80
Operating income $ 91,891.60
What was the gross margin percent? (Note: Round answer to two decimal places.)
a. 53.75%
b. 48.75%
c. 17.20%
d. 19.14%
139. Wright & Boyle Inc. had the following income statement for the month of May:
Sales revenue $470,800.00
Cost of goods sold 217,766.40
Gross margin $253,033.60
Less:
Selling expenses $ 86,199.20
Administrative expenses 74,942.80
Operating income $ 91,891.60
What was the selling expense percent? (Note: Round answer to two decimal places.)
a. 17.25%
b. 18.31%
c. 16.20%
d. No correct answer
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140. Wright & Boyle Inc. had the following income statement for the month of May:
Sales revenue $470,800.00
Cost of goods sold 217,766.40
Gross margin $253,033.60
Less:
Selling expenses $ 86,199.20
Administrative expenses 74,942.80
Operating income $ 91,891.60
What was the administrative expense percent? (Note: Round answer to two decimal places.)
a. 15.92%
b. 19.85%
c. 16.50%
d. 15.50%
141. Wright & Boyle Inc. had the following income statement for the month of May:
Sales revenue $470,800.00
Cost of goods sold 217,766.40
Gross margin $253,033.60
Less:
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Selling expenses $ 86,199.20
Administrative expenses 74,942.80
Operating income $ 91,891.60
What was the operating income percent? (Note: Round your answer to two decimal places.)
a. 15.75%
b. 19.65%
c. 17.55%
d. 19.52%
142. Hill & Scott Company makes financial calculators. During the current year, Hill & Scott manufactured 106,700
financial calculators. Finished goods inventory had the following units on hand:
January 1 1,386 units
December 31 1,144 units
How many financial calculators did Hill & Scott sell during the year?
a. 196,780
b. 106,942
c. 97,000
d. 108,260
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143. Hill & Scott Company makes financial calculators. During the current year, Hill & Scott manufactured 106,700
financial calculators. Finished goods inventory had the following units on hand:
January 1 1,386 units
December 31 1,144 units
If each financial calculator had a per-unit product cost of $123.20, what was the cost of finished goods inventory on
December 31? (Note: Round answer to two decimal places.)
a. $140,940.80
b. $141,120.50
c. $24,640.75
d. None of these are correct.
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144. Hill & Scott Company makes financial calculators. During the current year, Hill & Scott manufactured 106,700
financial calculators. Finished goods inventory had the following units on hand:
January 1 1,386 units
December 31 1,144 units
If each financial calculator had a per-unit product cost of $130, what was the cost of goods sold in the current year?
a. $10,864,000
b. $10,839,360
c. $11,005,120
d. $13,902,460
145. Knowles & Foreman Company took the following data from its income statement at the end of the current year:
Per-unit product cost $35
Gross margin percentage 41.20%
Selling and administrative expenses $30,900
Operating income $10,300
What was gross margin for the year?
a. $60,000
b. $100,000
c. $41,200
d. None of these
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146. Knowles & Foreman Company took the following data from its income statement at the end of the current year:
Per-unit product cost $35
Gross margin percentage 41.20%
Selling and administrative expenses $30,900
Operating income $10,300
What was cost of goods sold for the year?
a. $58,800
b. $40,600
c. $100,000
d. None of these