Question 1 of 20 5.0 Points
In comparing management accounting with financial accounting, which of the following statements is FALSE?
A. Management accounting is primarily used by managers, employees, and supply chain partners.
B. The report format for financial accounting is based on generally accepted accounting principles.
C. The purpose of management accounting reports is to provide information for planning, control, performance measurement, and decision making.
D. Financial accounting reports are prepared as needed.
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My choice is D
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Question 2 of 20 5.0 Points
The unit of measurement used in management accounting is:
A. primarily the future dollar.
B. monetary at historical and current market values.
C. monetary at historical or current market or projected values.
D. the measurement unit used by competing companies.
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My choice is C
Question 3 of 20 5.0 Points
When preparing a report, it is sometimes necessary to sacrifice accuracy for:
A. timeliness.
B. personal feelings.
C. profits.
D. expectations.
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My choice is A
Question 4 of 20 5.0 Points
Primary processes:
A. apply only to a just-in-time environment.
B. include information systems and human resources.
C. add value to a product or service.
D. limit bottlenecks during production.
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My choice is C
Question 5 of 20 5.0 Points
Primary processes are comprised of:accounting.
A. marketing, legal, and accounting services.
B. research and development, marketing, supply, design, production, distribution, and information systems.
C. research and development, design, supply, production, marketing, distribution, and customer service.
D. human resources, legal services, information systems, and management
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My choice is C
Question 6 of 20 5.0 Points
An advantage of value chain analysis is that it allows a company to:
A. evaluate ethical conduct.
B. focus on its core competencies.
C. use the four "w's."
D. increase sales to customers.
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My choice is B
Question 7 of 20 5.0 Points
The just-in-time philosophy emphasizes:
A. completing products on schedule.
B. increasing production.
C. finishing all products before starting new ones.
D. eliminating waste.
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My choice is D
Question 8 of 20 5.0 Points
Activity-based management's primary goal is to reduce:
A. nonvalue-adding costs.
B. defects.
C. inventory size.
D. machine setup time.
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My choice is A
Question 9 of 20 5.0 Points
The balanced scorecard:
A. is rarely used.
B. produces formal reports.
C. only applies to manufacturing companies.
D. links the organization's perspectives with stakeholders.
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My choice is D
Question 10 of 20 5.0 Points
If a management accountant confides to a relative that his or her company has a confidential plan to merge with another company in the near future, the accountant has:
A. not violated ethical standards.
B. violated ethical standards only if the relative owns stock in the company.
C. violated ethical standards because the accountant and relative could stand to gain personally from that information.
D. not violated ethical standards because the information was relayed to a family member.
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My choice is C
My choice is
Question 11 of 20 5.0 Points
An example of a period cost is:
A. advertising costs.
B. indirect materials.
C. product design costs.
D. direct materials.
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My choice is A
Question 12 of 20 5.0 Points
Which of the following is a value-adding cost?
A. Depreciation on personnel department equipment
B. Depreciation on factory equipment
C. Depreciation on office equipment
D. Depreciation on sales department equipment
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My choice is B
Question 13 of 20 5.0 Points
All manufacturing costs incurred and assigned to products that are being produced are classified as:
A. variable costs.
B. allocated costs.
C. product costs.
D. overhead costs.
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My choice is C
Question 14 of 20 5.0 Points
Which of the following is the formula used to compute a product's unit cost?
A. (Direct Materials + Direct Labor) / Number of Units Produced
B. (Direct Materials + Direct Labor + Overhead) / Number of Units Produced
C. (Direct Labor + Overhead) / Number of Units Produced
D. (Indirect Materials + Indirect Labor + Overhead) / Number of Units Produced
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My choice is B
Question 15 of 20 5.0 Points
In a manufacturing environment, direct labor costs initially flow:
A. into the Materials Inventory account.
B. directly to Cost of Goods Sold.
C. into the Work in Process Inventory account.
D. into the Finished Goods Inventory account.
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My choice is C
Question 16 of 20 5.0 Points
Cost of goods manufactured is equal to:
A. Direct Materials + Direct Labor + Overhead.
B. Beginning Work in Process Inventory + Total Manufacturing Costs - Ending Work in Process Inventory.
C. Beginning Work in Process Inventory + Period Costs - Ending Work in Process Inventory.
D. Beginning Work in Process Inventory + Product Costs.
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My choice is B
Question 17 of 20 5.0 Points
To reconcile total manufacturing costs with the total cost of goods manufactured during the period:
A. subtract out all period costs from total manufacturing costs to arrive at cost of goods manufactured.
B. add beginning and subtract ending finished goods inventory to total manufacturing costs.
C. you must know how many goods were sold during the period.
D. add beginning and subtract ending work in process inventory to total manufacturing costs.
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My choice is D
Question 18 of 20 5.0 Points
If the estimated cost driver level is overstated, the: predetermined overhead rate will be understated.
A. predetermined overhead rate will be overstated.
B. product cost will be overstated.
C. cost pool will be understated.
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Question 19 of 20 5.0 Points
The activity base that would be most appropriate in a capital-intensive industry is:
A. direct labor dollars.
B. direct labor hours.
C. sales volume.
D. machine hours.
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My choice is D
Question 20 of 20 5.0 Points
In an activity-based costing system, the first step in assigning costs is to:
A. accumulate costs for each activity.
B. identify the appropriate activities for each function.
C. separate nonvalue-adding activities from value-adding activities.
D. analyze all nonvalue-adding activities to determine if they are necessary support areas.
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My choice is B
Can you please assist in reviewing my choices?
Question 1 of 20 5.0 Points
Which of the following products probably would be manufactured using a job order costing system?
A. Paper
B. Baseball cards
C. Computer monitors
D. Company business cards
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Question 2 of 20 5.0 Points
Applied overhead exceeds actual overhead when the:
A. Overhead account has a credit balance.
B. journal entry to account for the difference involves a debit to Cost of Goods Sold.
C. Overhead account has a debit balance.
D. company has overspent in the overhead cost area.
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Question 3 of 20 5.0 Points
The total of the dollar amounts on the job order cost cards that have not been completed would be equal to the:
A. cost of goods completed.
B. balance in the Finished Goods Inventory account.
C. Cost of Goods Sold account.
D. balance in the Work in Process Inventory account.
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Question 4 of 20 5.0 Points
The basic document for keeping track of costs in a job order costing system is a:
A. job order cost card.
B. labor time card.
C. process cost report.
D. materials requisition form.
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Question 5 of 20 5.0 Points
When direct materials are issued from inventory to production under a job order costing system, an increase is recorded in:
A. Overhead.
B. Work in Process Inventory.
C. Materials Inventory.
D. Finished Goods Inventory.
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Question 6 of 20 5.0 Points
Unit costs for each job are computed by dividing:
A. estimated total costs by planned units to be produced.
B. actual costs by actual units sold.
C. cost of materials, direct labor, and overhead by number of units produced.
D. estimated total costs by actual units produced.
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Question 7 of 20 5.0 Points
In cost-plus contracts, the "plus" represents:
A. sales price.
B. profit, based on the amount of costs incurred.
C. overapplied overhead costs.
D. the amount of any cost overruns.
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Question 8 of 20 5.0 Points
The balance in the Work in Process Inventory account equals the:
A. balance in the Finished Goods inventory account.
B. balance in the Cost of Goods Sold account.
C. total of the balances on the job order cost sheets of uncompleted jobs.
D. balance in the Overhead account.
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Question 9 of 20 5.0 Points
Which of the following entities probably would use a process costing system?
A. An oil refinery
B. A yacht builder
C. A custom furniture company
D. A custom screw manufacturer
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Question 10 of 20 5.0 Points
Process costing is applicable to production operations that:
A. utilize several processes, departments, or work cells in a series.
B. do not assign overhead costs to operations.
C. produce large and unique machines.
D. are found in only a few industries.
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My Answers -
1 C
2 A
3 D
4 A
5 B
6 C
7 B
8 C
9 A
10 A
Sure! Here is your review of choices for the questions:
Question 1: D. Financial accounting reports are prepared as needed. - Correct!
Question 2: C. monetary at historical or current market or projected values. - Correct!
Question 3: A. timeliness. - Correct!
Question 4: C. add value to a product or service. - Correct!
Question 5: C. research and development, design, supply, production, marketing, distribution, and customer service. - Correct!
Question 6: B. focus on its core competencies. - Correct!
Question 7: D. eliminating waste. - Correct!
Question 8: A. nonvalue-adding costs. - Correct!
Question 9: D. links the organization's perspectives with stakeholders. - Correct!
Question 10: C. violated ethical standards because the accountant and relative could stand to gain personally from that information. - Correct!
Question 11: A. advertising costs. - Correct!
Question 12: B. Depreciation on factory equipment - Correct!
Question 13: C. product costs. - Correct!
Question 14: B. (Direct Materials + Direct Labor + Overhead) / Number of Units Produced - Correct!
Question 15: C. into the Work in Process Inventory account. - Correct!
Question 16: B. Beginning Work in Process Inventory + Total Manufacturing Costs - Ending Work in Process Inventory. - Correct!
Question 17: D. add beginning and subtract ending work in process inventory to total manufacturing costs. - Correct!
Question 18: A. predetermined overhead rate will be overstated. - Correct!
Question 19: D. machine hours. - Correct!
Question 20: B. identify the appropriate activities for each function. - Correct!
Overall, all of your choices are correct. Well done!
Certainly! Here's a review of your choices:
Question 1: You selected option D - Financial accounting reports are prepared as needed. This statement is FALSE because financial accounting reports are prepared on a regular basis, usually following specific accounting periods.
Question 2: You selected option C - Monetary at historical or current market or projected values. This is the correct answer. The unit of measurement used in management accounting can be monetary at historical or current market values, or projected values.
Question 3: You selected option A - Timeliness. This is the correct answer. When preparing a report, it is sometimes necessary to sacrifice accuracy for timeliness, especially when time-sensitive decisions need to be made.
Question 4: You selected option C - Add value to a product or service. This is the correct answer. Primary processes in management accounting refer to activities that add value to a product or service.
Question 5: You selected option C - Research and development, design, supply, production, marketing, distribution, and customer service. This is the correct answer. Primary processes in management accounting include research and development, design, supply, production, marketing, distribution, and customer service.
Question 6: You selected option B - Focus on its core competencies. This is the correct answer. Value chain analysis allows a company to identify and focus on its core competencies, which are the activities that give it a competitive advantage in the market.
Question 7: You selected option D - Eliminating waste. This is the correct answer. The just-in-time philosophy emphasizes eliminating waste in all forms, such as excess inventory, overproduction, and waiting time.
Question 8: You selected option A - Nonvalue-adding costs. This is the correct answer. Activity-based management aims to reduce nonvalue-adding costs, which are costs that do not directly contribute to the production or delivery of a product or service.
Question 9: You selected option D - Links the organization's perspectives with stakeholders. This is the correct answer. The balanced scorecard is a framework that links the organization's perspectives (financial, customer, internal processes, and learning and growth) with the interests of stakeholders.
Question 10: You selected option C - Violated ethical standards because the accountant and relative could stand to gain personally from that information. This is the correct answer. Sharing confidential, non-public information with a relative, especially if they could benefit financially from it, would be a violation of ethical standards.
Question 11: You selected option A - Advertising costs. This is the correct answer. Period costs, such as advertising costs, are incurred for the sole purpose of generating revenue during a specific period, rather than being directly tied to the production of a product.
Question 12: You selected option B - Depreciation on factory equipment. This is the correct answer. Depreciation on factory equipment is a value-adding cost because it contributes to the production process and the creation of a product.
Question 13: You selected option C - Product costs. This is the correct answer. All manufacturing costs incurred and assigned to products that are being produced are classified as product costs.
Question 14: You selected option B - (Direct Materials + Direct Labor + Overhead) / Number of Units Produced. This is the correct formula to compute a product's unit cost, taking into account direct materials, direct labor, and overhead.
Question 15: You selected option C - Into the Work in Process Inventory account. This is the correct answer. Direct labor costs incurred in a manufacturing environment flow into the Work in Process Inventory account.
Question 16: You selected option B - Beginning Work in Process Inventory + Total Manufacturing Costs - Ending Work in Process Inventory. This is the correct calculation for cost of goods manufactured, which takes into account the beginning and ending work in process inventory and the total manufacturing costs incurred.
Question 17: You selected option D - Add beginning and subtract ending work in process inventory to total manufacturing costs. This is the correct answer. To reconcile total manufacturing costs with the total cost of goods manufactured, you need to consider the beginning and ending work in process inventory.
Question 18: You selected option A - The predetermined overhead rate will be overstated. This is the correct answer. If the estimated cost driver level is overstated, the predetermined overhead rate will be overstated, leading to higher allocated overhead costs and potentially higher product costs.
Question 19: You selected option D - Machine hours. This is the correct answer for a capital-intensive industry, as machine hours are a relevant activity base for allocating costs in such an industry.
Question 20: You selected option B - Identify the appropriate activities for each function. This is the correct answer. The first step in assigning costs in an activity-based costing system is to identify the appropriate activities for each function, which will determine the cost drivers and allocation of costs.
Great job on your choices! If you have any more questions or need further clarification, feel free to ask.