Cash equivalents are usually listed as short-term investments on the balance sheet.
The Income Statement columns of the work sheet show all the accounts that need to be
closed.
Avoidable costs are the direct variable costs and direct fixed costs traceable to the
segments.
One element of a just-in-time operating environment is pull-through production, which
means that a firm starts production of a product only after an order is received.
Other revenues and expenses appears as a separate section on a single-step income
statement.
Management accountants are obligated to refrain from activities that would prejudice
their ability to carry out their duties.
The holder, or payee, of a dishonored note should transfer the total amount due,
including interest income, from Notes Receivable to an individual account receivable
for the debtor.
The direct materials price standard for a period is determined by averaging that period’s
cost of direct material purchases.
Dividends in arrears pertain only to cumulative preferred stock.
Transactions involving payments of cash for merchandise are recorded in the cash
payments journal.
At the end of each day, the cashier should be the one responsible for comparing the
amount on the cash register tape with the day’s cash additions to the cash register.
Process cost reports are prepared for each of the processes or work cells.
The quality of earnings refers to the substance of earnings and their sustainability into
future periods.
Capital investment analysis ensures that the resources are used wisely.
After management has set short-term goals, the budgeting process typically starts with
A.a clearly defined timetable of events.
B.input only from the accounting personnel.
C.the naming of an efficient coordinator or director.
D.a set of procedures or instructions.
Days’ inventory on hand equals 365 divided by
A.inventory turnover.
B.cost of goods sold.
C.goods available for sale.
D.average inventory.
Which of the following is a period cost?
A.Advertising costs
B.Indirect materials
C.Manufacturing overhead
D.Direct materials
When Smith Builder’s Designer House #201 is completed, Smith’s
A.Work in Process Inventory is increased.
B.total assets are increased.
C.Work in Process Inventory is decreased.
D.total assets are decreased.
James International is in the construction business. In 2014, it is expected that 30
percent of a month’s sales will be received in cash, with the balance being received the
following month. Of the purchases, 50 percent are paid the following month, 40 percent
are paid in two months, and the remaining 10 percent are paid during the month of
purchase.
The sales force receives $1,500 a month base pay plus a 4 percent commission. Labor
expenses are expected to be $4,000 a month. Other operating expenses are expected to
run about $4,500 a month, including $500 for depreciation. The ending cash balance for
2013 was $18,000.
a. Prepare a cash budget and determine the projected ending cash balances for the first
three months of 2014.
b. Determine the months that the company would either borrow or invest cash.
You have been invited to address the Students In Free Enterprise (SIFE) team of your
alma mater. The topic the team has chosen is the just-in-time philosophy in terms that
beginning business students can readily comprehend. The meeting is taking place in the
college cafeteria. Reservations and menu choices have been made in advance. It has
been suggested that you use that setting as an example of the implementation of a JIT
operating system. It will also be beneficial if you indicate in your talk some instances
where JIT would be less suitable in the college food services situation. What will you
say?
On January 1, a machine with a useful life of five years and a residual value of $4,500
is purchased for $22,500. What is the depreciation expense in year 3 under straight-line
depreciation?
A.$4,500
B.$3,600
C.$10,800
D.$13,500
At production levels below the breakeven point,
A.fixed costs are recovered.
B.profit is negative.
C.variable costs are zero.
D.fixed costs are zero.
Riverside has gathered the following data in order to calculate the weighted-average
contribution margin: Round intermediate and final answers to two decimal places.
The weighted-average contribution margin is
A.$175.
B.$100.
C.$95.50
D.$75.50
A job order costing system measures product costs
A.using process cost reports.
B.in several Work in Process Inventory account.
C.with regard to the process that created the cost.
D.for each completed unit.
Ratios are most useful in identifying
A.causes.
B.differences.
C.relationships.
D.trends.
Use this information to answer the following question.
The following totals for the month of September were taken from the payroll register of
Meadors Company:
The journal entry to record the monthly payroll on September 30 would include a
A.debit to Salaries Expense for $24,000.
B.debit to Salaries Payable for $24,000.
C.credit to Salaries Payable for $24,000.
D.debit to Salaries Expense for $9,000.
Which cost measurement method calculates product unit cost using estimates for direct
materials, direct labor, and overhead?
A.Standard costing
B.Actual costing
C.Full costing
D.Normal costing
Use the following data of Daylight Incorporation, a company using a process costing
system, to answer the questions below.
The company uses average process costing method.
Equivalent units for direct materials of Daylight during the month totaled
A.9,300.
B.7,500.
C.7,700.
D.9,500.
What is the effect of the payment of an account payable on the current ratio and the
quick ratio, respectively? (Assume the current ratio was 2.3 times and the quick ratio
was 2.1 times before this transaction.)
A.Decrease in current ratio; no effect on quick ratio
B.Increase in current ratio; increase in quick ratio
C.No effect on current ratio; no effect on quick ratio
D.Decrease in current ratio; decrease in quick ratio
Which of the following is a common type of incentive compensation?
A.Health insurance
B.Profit-sharing plans
C.Pension plans
D.Flexible spending programs
Which of the following is a product cost?
A.General expenses
B.Selling expenses
C.Advertising expenses
D.Material handling expenses
Which of the following entries could not be a legitimate reversing entry?
A.Debit Wages Payable and credit Wages Expense
B.Debit Fees Earned and credit Accounts Receivable
C.Debit Interest Payable and credit Interest Expense
D.Debit Interest Receivable and credit Interest Income
Which of the following is an example of a deferral?
A.Utility expense incurred but not yet paid.
B.Prepaid Insurance.
C.Service income earned but not yet collected.
D.All of these choices.
Which of the following classifications represents the largest number of shares?
A.Authorized shares.
B.Outstanding shares.
C.Treasury shares.
D.Issued shares.
When a fully depreciated asset with a residual value is discarded
A.a loss equal to its residual value may be recognized.
B.a gain equal to its residual value may be recognized.
C.no gain or loss may be recognized.
D.a gain for its carrying value may be recognized.
James Corporation’s controller has developed the cost and usage data listed below in
preparation of standard unit cost information for the coming year.
Using the above information provided for James Corporation, the total standard unit
cost is
A.$99.
B.$132.
C.$102.
D.$46.