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Study Resources (Accounting)

41.Indirect costs can be specifically traced to a cost object. a.True b.False 42.Period (nonmanufacturing) costs are classified into two categories: selling and administrative. a.True b.False 43.Prime costs are the combination of direct labor costs and factory overhead costs. a.True b.False 44.Prime costs are the combination of direct materials and direct labor costs. a.True b.False 45.Conversion costs are the combination of direct labor,.
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152.  The following information is available for Carter Corporation: 1)  Materials inventory decreased $4,000. 2)  Materials inventory on December 31 was 50% of materials inventory on January 1. 3)  Beginning work in process inventory was $145,000. 4)  Ending finished goods inventory was $65,000. 5)  Purchases of direct materials were $154,700. 6)  Direct materials used were 2.5.
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119.What is the rate earned on common stockholders’ equity for Diane Company? a. 6.75% b. 14.8% c. 7.4% d. 13.5% 120.What is the price earnings ratio for Diane Company? a.8.0 times b.2.5 times c.4.0 times d.6.0 times 121.The following information pertains to Newman Company. Assume that all balance sheet amounts represent bothaverage and ending balance figures and that all sales.
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138.  The following data are taken from the financial statements: Current Preceding Year Year Sales $3,600,000 $4,000,000 Cost of goods sold 2,000,000 2,700,000 Average inventory 372,000 352,000 Inventory, end of year 372,000 347,000 (a) (b) Determine for each year (1) the inventory turnover, round answer to one decimal place. (2) the number of days' sales in inventory. Round intermediate calculations to two decimalplaces and the final answer to whole.
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88.Materials must have which two qualities in order to be classified as direct materials? a.They must be classified as both prime costs and conversion costs. b.They must be introduced into the process in both work-in-process inventories and finished goods inventories. c.They must be an integral part of the finished product, but can be.
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152.  Identify the following costs as (a) prime cost, (b) conversion cost, or (c) both for a cake factory. 1.  Frosting 2.  Wages of the baker 3.  Sprinkles for the topping (considered an indirect material) 4.  Depreciation on oven 153.  Classify the following costs as direct, indirect, or neither: a) labor for machine maintenance b) factory equipment depreciation c) materials not.
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138.  Revenue and expense data for Young Technologies are as follows: Year 2 Year 1 Sales $500,000 $440,000 Cost of goods sold 325,000 242,000 Selling expense 70,000 79,200 Administrative expenses 75,000 70,400 Income tax expense 10,500 16,400 (a)                 Prepare an income statement in comparative form, stating each item for both years as anamount and as a percent of sales. Round to the nearest whole percent. (b)                Comment on the.
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152.  The phases of the management process are listed below. Match each phase to the appropriate description.     Planning     Directing    Controlling     Improving     Decision making a)  Used by managers for continuous improvement b)  Managers must decide how to respond to unfavorable performances c) Used by management to develop the organization’s objectives and goals d)  Monitoring the operating results of implemented plans.
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Match each definition that follows with the term (a–h) it defines. discontinued operations extraordinary items change from one generally accepted accounting principle to another horizontal analysis vertical analysis common-sized financial statements current position analysis profitability analysis 139.  a percentage analysis of increases and decreases in related items on comparative financial statements 140.  an event or transaction that is both unusual.
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129.Which of the following would appear as an extraordinary item on the income statement? a.loss resulting from the sale of fixed assets b.gain resulting from the disposal of a segment of the business c.loss from land condemned for public use d.liquidating dividend 130.A loss on disposal of a segment would be reported in the income.
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68.In order to be useful to managers, managerial accounting reports should possess all of the following characteristicsexcept a.provide objective measures of past operations and subjective estimates about future decisions b.be prepared in accordance with generally accepted accounting principles c.be provided at any time management needs information d.be prepared to report information for any unit.
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118.Jensen Company’s period costs are a. $345,000 b. $250,000 c. $400,000 d. $175,000 119.Which of the following is nota factory overhead cost? a.materials used directly in the manufacturing process of the product b.insurance on factory equipment c.salaries of production supervisors d.property tax on factory building 120.Factory overhead includes a.factory rent and direct labor b.direct materials and direct labor c.indirect materials and direct materials d.indirect.
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31.Factory overhead cost is sometimes referred to as factory burden. a.True b.False 32.Conversion cost is the combination of direct labor cost and factory overhead cost. a.True b.False 33.Conversion cost is the combination of direct materials cost and factory overhead cost. a.True b.False 34.Factory overhead is an example of a product cost. a.True b.False 35.Direct labor costs are included in the conversion costs.
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1.Managerial accounting reports must be prepared according to generally accepted accounting principles. a.True b.False 2.Managerial accounting uses only past data in reports to aid management in the decision making process. a.True b.False 3.Managerial accounting information includes both historical and estimated data. a.True b.False 4.Since there are few rules to restrict how an organization chooses to arrange its own internal.
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138.  The following information has been condensed from the December 31 balance sheets of Gabriel Co.: Year 2 Year 1 Assets: Current assets $ 825,500 $ 674,300 Fixed assets (net) 1,473,600 1,275,300 Total assets $2,299,100 $1,949,600 Liabilities: Current liabilities $ 313,500 $ 309,600 Long-term liabilities 703,000 545,000 Total liabilities $1,016,500 $ 854,600 Stockholders' equity $1,282,600 $1,095,000 Total liabilities and stockholders' equity $2,299,100 $1,949,600 (a)    Determine the ratio of fixed assets to long-term liabilities for each year. (b)    Determine.
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138.  A company reports the following: Net income $150,000 Preferred dividends $10,000 Shares of common stock outstanding 20,000 Market price per share of common stock $35 Calculate the company’s earnings per share on common stock. 139.  A company reports the following: Net income $350,000 Preferred dividends 50,000 Average stockholders’ equity 1,000,000 Average common stockholders’ equity 800,000 Determine the (a) rate earned on stockholders’ equity, and (b) rate earned on.
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21.The cost of a manufactured product generally consists of direct materials cost, direct labor cost, and factoryoverhead cost. a.True b.False 22.The cost of materials entering directly into the manufacturing process is classified as factory overhead cost. a.True b.False 23.The cost of wages paid to employees directly involved in converting materials to finished product is classified asdirect.
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138.  Condensed data taken from the ledger of St. Louis Company at December 31, for the current and preceding years,are as follows: Year 2 Year 1 Current assets $160,000 $130,000 Property, plant, and equipment 450,000 400,000 Intangible assets 20,700 30,000 Current liabilities 70,000 80,000 Long-term liabilities 210,000 250,000 Common stock 225,000 150,000 Retained earnings 125,700 80,000 Prepare a comparative balance sheet, with horizontal analysis, for December 31, Year 2 and Year 1. (Roundpercents to.
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128.The following information is taken from the financial records of Gunner Manufacturing: Cost of materials used$45,000 Direct labor costs48,000 Factory overhead39,000 Work in process, beg.18,000 Work in process, end.28,000 What is cost of goods manufactured?a. $178,000 b. $132,000 c. $122,000 d. $142,000 129.Which of the following are reported on the income statement as part of cost of goods? a.administrative expenses b.period costs c.cost.
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138.        From the following data for Norton Company for the year ended December 31, prepare a multiple-step incomestatement. Show earnings per share for the following: income from continuing operations, loss on discontinuedoperations (less applicable income tax), income before extraordinary item, extraordinary item (less applicableincome tax), and net income. Common stock, $50.
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152.  Classify the following costs as either a product cost or a period cost: a) direct materials used b) factory utilities c) salespersons’ commissions d) salary of plant manager e) indirect materials used f) depreciation on store equipment g) indirect labor incurred h) advertising expense i) direct labor incurred j) factory machinery repairs and maintenance k) depreciation on factory machinery l) plant insurance expired 153.  .
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61.On the balance sheet for a manufacturing business, the cost of direct materials, direct labor, and factory overheadare categorized as either materials inventory, work in process inventory, or finished goods inventory. a.True b.False 62.The statement of cost of goods manufactured is an extension of the income statement for a manufacturingcompany. a.True b.False 63.Managers use managerial information.
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138.  What is a major advantage of using percentages rather than dollar changes in doing horizontal and vertical analysis? 139.  The following items are reported on a company’s balance sheet: Cash $230,000 Marketable securities 50,000 Accounts receivable 200,000 Inventory 240,000 Accounts payable 300,000 Determine the (a) current ratio, and (b) quick ratio.  Round your answer to one decimal place. 140.  The following items.
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152.  Match each description to the appropriate term (a-d). a)  direct materials b)  selling and administrative expense c)  factory overhead d)  direct labor (1) rent expense on factory building (2) sales supplies used (3) factory supplies used (4) indirect materials used (5) wages of assembly line personnel (6) cost of primary material used to make product (7) depreciation on office equipment (8) rent on office facilities (9) insurance expired on factory.
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138.  Selected data from the Carmen Company at year end are presented below: Total assets $2,000,000 Average total assets 2,200,000 Net income 250,000 Sales 1,300,000 Average common stockholders' equity 1,000,000 Net cash provided by operating activities 275,000 Shares of common stock outstanding 10,000 Calculate: (a) ratio of sales to assets; (b) rate earned on total assets; (c) rate earned on common stockholders' equityand (d) earnings.
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138.  The following data are taken from the financial statements: Current Preceding Year Year Current assets $  745,000 $  820,000 Property, plant, and equipment 1,510,000 1,400,000 Current liabilities (non-interest-bearing) 160,000 140,000 Long-term liabilities, 12% 400,000 400,000 Preferred 10% stock 250,000 250,000 Common stock, $25 par 1,200,000 1,200,000 Retained earnings, beginning of year 230,000 160,000 Net income for year 110,000 155,000 Preferred dividends declared (25,000) (25,000) Common dividends declared (70,000) (60,000) Determine for the current year the (a) rate earned on total assets, (b) rate earned on stockholders'.
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138.  The following data are available for Martin Solutions, Inc. Year 2 Year 1 Sales $1,139,600 $1,192,320 Beginning inventory 80,000 64,000 Cost of goods sold 500,800 606,000 Ending inventory 72,000 80,000 (1)             Determine for each year: (a)         The inventory turnover (b)         The number of days’ sales in inventory (Round intermediate calculation to the nearestwhole number and your final answer to one decimal place). (2)             What conclusions can be.
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138.  The following items are reported on Denver Company’s balance sheet: Cash $190,000 Marketable securities 160,000 Accounts receivable (net) 240,000 Inventory 350,000 Accounts payable 600,000 Determine (a) the current ratio and (b) the quick ratio. Round to one decimal place. 139.  For Garrison Corporation, the working capital at the end of the current year is $10,000 more than the workingcapital at the.
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108.Which of the following is nota prime cost? a.plant janitor’s wages b.direct labor wages c.machine operator wages d.assembly line wages 109.The Darwin Company reports the following information: Sales$76,500 Direct materials used7,300 Depreciation on factory equipment4,700 Indirect labor5,900 Direct labor10,500 Factory rent4,200 Factory utilities1,200 Sales salaries expense15,600 Office salaries expense8,900 Indirect materials1,200 Product costs area. $24,500 b. $30,300 c. $29,200 d. $35,000 110.Product costs a.appear only on the balance sheet b.appear only on.
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138.  The following selected data were taken from the financial statements of the Winter Group for the three most recentyears of operations: Dec. 31, Year 3 Dec.31, Year 2 Dec. 31, Year 1 Total assets $3,000,000 $2,700,000 $2,400,000 Notes payable (10% interest) 1,000,000 1,000,000 1,000,000 Common stock 400,000 400,000 400,000 Preferred $6 stock, $100 par 200,000 200,000 200,000 Retained earnings 1,126,000 896,000 600,000 The Year 3 net income was $242,000 and the Year 2.
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78.Which of the following are basic phases of the management process? a.supervising and directing b.decision making and supervising c.organizing and directing d.planning and controlling 79.What term is used to describe the process of monitoring operating results and comparing actual results with theexpected results? a.improving b.controlling c.directing d.planning 80.Accounting designed to meet the needs of decision makers inside the business is a.general.
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138.  Cash and accounts receivable for Adams Company are provided below: Current Year Prior Year Cash $70,000 $50,000 Accounts receivable (net) 70,400 80,000 What is the amount and percentage of increase or decrease that would be shown with horizontal analysis? 139.  The following items were taken from the financial statements of Tilden, Inc., over a three-year period: Item Year 3 Year.
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138.  Revenue and expense data for Bluestem Company are as follows: Year 2 Year 1 Administrative expenses $ 37,000 $ 20,000 Cost of goods sold 350,000 320,000 Income tax 40,000 32,000 Sales 800,000 700,000 Selling expenses 150,000 110,000 (a)          Prepare a comparative income statement, with vertical analysis, stating each item for bothyears as a percent of sales. (b)         Comment upon significant changes disclosed by the comparative income statement. Round percentages.
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138.All of the following would be reported on the balance sheet as a current asset except a.factory overhead b.materials inventory c.finished goods inventory d.work in process inventory 139.Smith Company reports the following information: Cost of goods manufactured$68,250 Direct materials used27,000 Direct labor incurred25,000 Work in process inventory, January 111,000 Factory overhead is 75% of the cost of direct labor.  Work.
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138.  A company reports the following: Sales$1,200,000 Average accounts receivable (net)50,000 Determine the (a) accounts receivable turnover, and (b) number of days’ sales in receivables. Round your answerto one decimal place. 139.  A company reports the following: Cost of goods sold$610,000 Average inventory80,000 Determine the (a) inventory turnover, and (b) number of days’ sales in inventory.   Round.
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152.  The Zoe Corporation has the following information for the month March. Determine the (a) cost of goodsmanufactured, and (b) cost of goods sold. Cost of materials placed in production $69,000 Direct labor 27,000 Factory overhead 34,000 Work in process, March 1 15,000 Work in process, March 31 19,500 Finished goods inventory, March 1 25,000 Finished goods inventory, March 31 23,000 153.   Sienna Company has.
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11.The controller's staff consists of management accountants responsible for systems and procedures, generalaccounting, budgets, taxes, and cost accounting. a.True b.False 12.Managerial accounting reports must be useful to the user of the information. a.True b.False 13.Planning is the process of monitoring operating results and comparing actual results with the expected results. a.True b.False 14.Planning is the process of developing the.
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51.Operating expenses are product costs and are expensed when the product is sold. a.True b.False 52.Period costs are operating costs that are expensed in the period in which the goods are sold. a.True b.False 53.Factory overhead includes all manufacturing costs except direct materials and direct labor. a.True b.False 54.Labor costs that are directly traceable to the product are part.
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138.  What information is generally included in the Management Discussion and Analysis (MD&A) section of acorporate annual report? 139.  Prepare an income statement using the following data for New Orleans Adventures for the year ended December31: Sales $24,500,000 Cost of merchandise sold 10,900,000 Operating expenses 6,300,000 Losses from asset impairment 2,800,000 Income tax expense 500,000 Loss on discontinued operations 100,000 Net loss on extraordinary.
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138.  A company reported the following: Net income $270,000 Preferred dividends $10,000 Shares of common stock outstanding 20,000 Market price per share of common stock $36.40 Calculate the company’s price­earnings ratio.  Round your answer to one decimal place. 139.  Why would you compare or not compare Coca-Cola and Pepsi-Cola (PepsiCo) as companies to each other? 140.  .
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138.  The following data are taken from the balance sheet at the end of the current year. Cash $154,000 Accounts receivable 210,000 Inventory 240,000 Prepaid expenses 15,000 Temporary investments 350,000 Property, plant, and equipment 375,000 Accounts payable 245,000 Accrued liabilities 4,000 Income tax payable 10,000 Notes payable, short-term 85,000 Determine the (a) working capital, (b) current ratio, and (c) quick ratio. Round ratios to the nearest tenth. 139.  The following data are.
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98.Which of the following costs are conversion costs? a.direct labor cost and factory overhead cost b.direct materials cost and direct labor cost c.factory overhead cost d.direct materials cost and factory overhead cost 99.Goods that are partially completed by a manufacturer are a.merchandise inventory b.work in process inventory c.finished goods inventory d.materials inventory 100.What term refers to the cost of changing.
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138.  Zeus Company reports the following for the current year: Income from continuing operations before income tax $500,000 Extraordinary property loss from hurricane $60,000* Loss from discontinued operations $90,000* Weighted average number of common shares outstanding 40,000 Applicable tax rate 40% *Net of any tax effect (a)             Prepare a partial income statement for Zeus Company beginning with income fromcontinuing operations before income.
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138.  Gallant Company reported net income of $2,500,000.  The income statement included a $500,000 gain fromcondemnation of land and a $200,000 loss on discontinued operations, both after applicable income tax. There were100,000 shares of $10 par common stock and 40,000 shares of 4% preferred stock of $100 par outstandingthroughout the.
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152.  Magnus Industries has the following data: Beginning raw materials inventory $75,000 Materials purchased 40,000 Ending raw materials inventory 60,000 Calculate the cost of raw materials used. 153.  Watson Company has the following data: Work in process, beginning $18,000 Work in process, ending 25,000 Direct labor costs incurred 5,000 Cost of goods manufactured 9,000 Factory overhead 7,000 Calculate the amount of direct materials used. 154.  Laramie Technologies had the following.
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152.  The Putney Company reports the following information: Sales $76,500 Direct materials used 7,300 Depreciation on factory equipment 4,700 Indirect labor 5,900 Direct labor 10,500 Factory rent 4,200 Factory utilities 1,200 Sales salaries expense 15,600 Office salaries expense 8,900 Indirect materials 1,200 Compute: a)  product costs b)  period costs 153.  Identify the following costs as a (a) product cost or (b) period cost for a cake factory. 1.    Frosting 2. _____ Baker’s wages 3.  Advertising fees 4.  Transportation out 154. .
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138.  Why would you or why wouldn’t you compare an organization like Ford Motor Company to the local car dealer“Johnson City Ford/Lincoln/Mercury” in vertical and horizontal analysis? 139.  The balance sheet data of Randolph Company for two recent years appears below: Assets: Year 2 Year 1 Current assets $ 440 $280 Plant assets 675 520 Total assets $1,115 $800 Liabilities and stockholders'.
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Match each ratio that follows to its use (items a–h).  Items may be used more than once. assess the profitability of the assets assess the effectiveness in the use of assets indicate the ability to meet currently maturing obligations indicate the margin of safety to creditors indicate instant debt-paying ability assess the profitability of the investment.
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138.  Define solvency and profitability.  How are they alike? 139.  A company reports the following: Sales$2,400,000 Average total assets1,500,000 Determine the ratio of sales to assets.  Round your answer to one decimal place. 140.  A company reports the following: Sales$2,520,000 Average total assets1,400,000 Determine the ratio of sales to assets.  Round your answer to one decimal place. 141.  A.
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