MCQ Final exam Corporate Financial and Managerial Accounting
Which one of the
following characteristics would likely be associated with a just-in-time
inventory method? (Points : 1)
Ending
inventory of work in process that would allow several production runs
A
backlog of inventory orders not yet shipped
Minimal
finished goods inventory on hand
An
understanding with customers that they may come to the showroom and select
from inventory on hand
Question
2.2.The work of factory employees that can be physically and
directly associated with converting raw materials into finished goods is
(Points : 1)
manufacturing
overhead.
indirect
materials.
indirect
labor.
direct labor.
Question
3.3.For inventoriable costs to become expenses under the
matching principle, (Points : 1)
the
product must be finished and in stock.
the
product must be expensed based on its percentage-of-completion.
the
product to which they attach must be sold.
all
accounts payable must be settled.
Question
4.4.The principle difference between a merchandising and a
manufacturing income statement is the (Points : 1)
cost
of goods sold section.
extraordinary
item section.
operating
expense section.
revenue
section.
Question
5.5.A distinguishing feature of managerial accounting is
(Points : 1)
external
users.
general-purpose
reports.
very
detailed reports.
quarterly
and annual reports.
Question
6.6.Which of the following is one of the components of cost
accounting? (Points : 1)
It
involves measuring product costs.
It
involves the determination of company profits.
It
requires GAAP to be applied.
It
requires cost minimizing principles.
Question
7.7.If the entry to assign factory labor showed only a debit
to Work In Process Inventory, then all labor costs were (Points : 1)
direct
labor.
indirect
labor.
overtime
related.
regular
hours.
Question
8.8.If, at the end of the year, Manufacturing Overhead has
been overapplied, it means that (Points : 1)
actual
overhead costs were greater than the overhead assigned to jobs.
actual
overhead costs were less than the overhead assigned to jobs.
overhead
has not been applied to jobs still in process.
cost
of goods will have to be increased by the amount of the overapplied overhead.
Question
9.9.In computing equivalent units, ___________ is not part of
the equivalent units of production formula. (Points : 1)
units
transferred out
beginning
work in process
ending
work in process
None
of these is correct.
Question
10.10.The total units accounted for equals units in (Points :
1)
beginning
work in process – units transferred out.
beginning
work in process + ending work in process.
ending
work in process + units transferred out.
ending
work in process – units started into production.
Question
11.11.In process cost accounting, manufacturing costs are
summarized on a (Points : 1)
job
order cost sheet.
process
order cost sheet.
production
cost report.
manufacturing
cost sheet.
Question
12.12.Which would be an appropriate cost driver for the
ordering activity? (Points : 1)
Machine
setups.
Purchase
orders.
Machine
hours.
Inspections.
Question
13.13.Cost behavior analysis applies to (Points : 1)
retailers.
wholesalers.
manufacturers.
all
entities.
Question
14.14.Which one of the following is not an
assumption of CVP analysis? (Points : 1)
All
units produced are sold.
All
costs are variable costs.
Sales
mix remains constant.
The
behavior of costs and revenues are linear within the relevant range.
Question
15.15.Kohler Corporation sells its product for $40. The
variable costs are $18 per unit. Fixed costs are $16,000. The company is
considering the purchase of an automated machine that will result in a $2
reduction in unit variable costs and an increase of $5,000 in fixed costs.
Which of the following is true about the break-even point in units? (Points
: 1)
It
will remain unchanged.
It
will decrease.
It
will increase.
It
cannot be determined from the information provided.
Question
16.16.Which is the true statement? (Points : 1)
In
a CVP income statement, costs and expenses are classified only by function.
The
CVP income statement is prepared for both internal and external use.
The
CVP income statement shows contribution margin instead of gross profit.
In
a traditional income statement, costs and expenses are classified as either
variable or fixed.
Question
17.17.Which of the following is not an operating budget?
(Points : 1)
Direct
labor budget
Sales
budget
Production
budget
Cash
budget
Question
18.18.The total direct labor hours required in preparing a
direct labor budget are calculated using the (Points : 1)
sales
forecast.
production
budget.
direct
materials budget.
sales
budget.
Question
19.19.The cash budget reflects (Points : 1)
all
revenues and all expenses for a period.
expected
cash receipts and cash disbursements from all sources.
all
the items that appear on a budgeted income statement.
all
the items that appear on a budgeted balance sheet.
Question
20.20.Instead of a production budget, a merchandiser will
prepare a (Points : 1)
pseudo-production
budget.
merchandise
purchases budget.
master
time sheet.
sales
forecast.
Question
21.21.Limpia Industries produced 320,000 units in 150,000
direct labor hours. Production for the period was estimated at 330,000
units and 165,000 direct labor hours. A flexible budget would compare
budgeted costs and actual costs, respectively, at (Points : 1)
160,000
hours and 165,000 hours.
165,000
hours and 150,000 hours.
160,000
hours and 150,000 hours.
150,000
hours and 150,000 hours.
Question
22.22.Costs that relate specifically to one center and are
incurred for the sole benefit of that center are (Points : 1)
common
fixed costs.
direct
fixed costs.
indirect
fixed costs.
noncontrollable
fixed costs.
Question
23.23.The foreign subsidiary of a large corporation is (Points
: 1)
not
a responsibility center.
a
profit center.
a
cost center.
an
investment center.
Question
24.24.Management by exception (Points : 1)
is
most effective at top levels of management.
can
be implemented at each level of responsibility within an organization.
can
only be applied when comparing actual results with the master budget.
is
the opposite of goal congruence.
Question
25.25.The direct materials quantity standard should (Points :
1)
exclude
unavoidable waste.
exclude
quality considerations.
allow
for normal spoilage.
always
be expressed as an ideal standard.
Question
26.26.If actual direct materials costs are greater than
standard direct materials costs, it means that (Points : 1)
actual
costs were calculated incorrectly.
the
actual unit price of direct materials was greater than the standard unit
price of direct materials.
the
actual unit price of raw materials or the actual quantities of raw materials
used was greater than the standard unit price or standard quantities of raw
materials expected.
the
purchasing agent or the production foreman is inefficient.
Question
27.27.Which of the following statements is false? (Points : 1)
The
overhead volume variance indicates whether plant facilities were used
efficiently during the period.
The
costs that cause the overhead volume variance are usually controllable costs.
The
overhead volume variance relates solely to fixed costs.
The
overhead volume variance is favorable if standard hours allowed for output
are greater than the standard hours at normal capacity.
Question
28.28.Incremental analysis is synonymous with (Points : 1)
difficult
analysis.
differential
analysis.
gross
profit analysis.
derivative
analysis.
Question
29.29.Opportunity cost is usually (Points : 1)
a
standard cost.
a
potential benefit.
a
sunk cost.
included
as part of cost of goods sold.
Question
30.30.Capital budgeting is the process (Points : 1)
used
in sell or process further decisions.
of
determining how much capital stock to issue.
of
making capital expenditure decisions.
of
eliminating unprofitable product lines.
