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Exam 1: Introduction to Managerial Accounting

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Question 81

True/False

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Planning is the process of monitoring operating results and comparing actual results with the expected results.

A) True
B) False

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Question 82

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Which of the following is not true in regards to direct materials for a bakery?

A) Flour and sugar would probably be direct materials.
B) Eggs would probably be a direct material.
C) Oil to lubricate factory machines would not be a direct material.
D) Paper cupcake liners, that become part of the product, must be accounted for as direct materials.

E) B) and C)
F) A) and D)

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Question 83

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The cost of wages paid to employees directly involved in the manufacturing process in converting materials into finished products is classified as

Which of the following is an example of a factory overhead cost?

Differentiate between: a) direct materials versus indirect materials b) direct labor versus indirect labor

Conversion cost is the combination of direct materials cost and factory overhead cost.

Bartel Corporation produces bar stools for restaurants. For each of the following, indicate whether the cost would typically be considered direct or indirect cost for the cost object given.

Period costs are operating costs that are expensed in the period in which the goods are sold.

Direct labor costs are included in the conversion costs of a product.

Managerial accounting information includes both historical and estimated data.

Materials must have which two qualities in order to be classified as direct materials?

Who are the individuals charged with the responsibility for directing the day-to-day operations of a business?

Differentiate between a line department and a staff department.

Managers used managerial information for all of the following except

The cost of goods sold for Michaels Manufacturing in the current year was $233,000.  The January 1 finished goods inventory balance was $31,600, and the December 31 finished goods inventory balance was $24,200.  Cost of goods manufactured during the period was

Magnus Industries has the following data: Calculate the cost of raw materials used.

Prime costs are the combination of direct materials and direct labor costs.

Which of the following accounts will be found on the income statement?

The following data (in thousands of dollars) have been taken from the accounting records of Rayburn Corporation for the current year. Required:   (Present all calculations in thousands of dollars.)  (a) What was the cost of the direct materials used in production during the year? (b) What was the cost of goods manufactured for the year? (c) What was the cost of goods sold for the year? (d) What was the net income for the year? Present all calculations in thousands of dollars.

Managers do not need to consider the social and environmental settings in which a business operates.