ACCT 2000- Ch. 14

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Places emphasis on special-purpose information
managerial accounting
The management of an organization performs several broad functions. They are:
planning, directing, and controlling
After passage of the Sarbanes-Oxley Act of 2002:
CEOs and CFOs must certify that financial statements give a fair presentation of the company’s operating results
Direct Materials are a ______ cost.
product
Which of the following costs would a computer manufacturer include in manufacturing overhead?

A) the cost of the disk drives
B) wages earned by computer assemblers
C) cost of the memory chips
D) depreciation on testing equipment

depreciation on testing equipment
What is NOT an element of manufacturing overhead?
sales manager’s salary
Indirect labor is a ______ cost.
product
What is an example of a period cost?
wages paid to a cost accounting department supervisor
For the year, Redder Company has cost of goods manu-factured of $600,000, beginning finished goods inventory of $200,000, and ending finished goods inventory of $250,000. The cost of goods sold is:
$550,000 (beginning finished goods+cost of goods manufactured-ending finished goods)
Cost of goods available for sale is a step in the calculation of cost of goods sold of:
a merchandising company and a manufacturing company
A cost of goods manufactured schedule shows beginning and ending inventories for:
raw materials and work in process only
The formula to determine cost of goods manufactured is:
beginning work in process inventory + total manufacturing costs – ending work in process inventory
What is the order of the 3 inventories a manufacturer can report on a balance sheet?
finished goods, work in process, and raw materials
What managerial accounting technique attempts to allocate manufacturing overhead in a more meaningful fashion?
activity-based accounting
What are 3 examples of recent trends in the economic environment of US businesses?
increasing deregulation, increasing global competition, and a shift toward providing services rather than goods
Which of the following would NOT describe managerial accounting reports?

A) they are internal reports
B) they provide general purpose information for all users
C) they are issued as frequently as the need arises
D) the reporting standard is relevant to the decision to be made

they provide general purpose information for all users
Financial and managerial accounting are similar in that both:
deal with economic events of an enterprise
The function of coordinating the diverse activities and human resources of a company to produce a smooth running operation is:
directing
The function that pertains to keeping up the activities of the enterprise on track is:
controlling
The function that involves looking ahead and establishing objectives by management is:
planning
If the cost of goods manufactured is less than the cost of goods sold, then what is correct?
finished goods inventory has decreased
The account that shows the cost of production for those units that have been started in the manufacturing process, but that are NOT complete at the end of the accounting period is:
work in process inventory
Costs that are matched with the revenue of a specific time period and charged to expense as incurred.
period costs
A method of allocating overhead based on each product’s use of activities in making the product
activity-based costing
A field of accounting that provides economic and financial information for managers and other internal users
managerial accounting
A performance-measurement approach that uses both financial and non-financial measures, tied to company objectives, to evaluate a company’s operations in an integrated fashion
balanced scorecard
Work of factory employees that has no physical association with the finished product, or it is impractical to trace the costs to the goods produced
indirect labor
Systems implemented to reduce defects in finished products with the goal of achieving zero defects
total quality management
Manufacturing costs that are indirectly associated with the manufacturer of the finished product
manufacturing overhead
All activities associated with providing a service or product
value chain
The work of factory employees that can be physically and conveniently associated with converting raw materials into finished goods
direct labor
Raw materials that do not physically become part of the finished product or cannot be traced because their physical association with the finished product is too small
indirect materials
Inventory system in which goods are manufactured or purchased just-in-time for use
just-in-time inventory
Costs that are necessary and integral part of producing the finished product
product costs
Raw materials that can be physically and conveniently associated with manufacturing the finished product
direct materials
Categories: Managerial Accounting