Review Assessment: Online Assignment One S2 2012 Essay

1.The service department embody allocation method that completely ignores reciprocal services between service departments is called the causeSelected dissolver top method.2.In order to have a high-quality finished product serveSelected resolutenessthe products design specifications must ensure customers expectations AND the product must meet the standards of its design.3.The assume method ignores the fact that dissolventSelected Answersome service departments provide services to other service departments4.Refer to the chase data. reign over material employ$150 000merchandising appeals$5 000In reign over labour$7 000Administrative costs$10 000 dispraise on factory equipment$70 000Direct labour$40 000Overtime premiums paid$20 000Indirect materials$45 000The product costs areAnswerSelected Answer$332 0005.The Casual Furniture troupe manufactures outdoor furniture, and incurred the following costs during the month of January. Timber$25 000Paint$5 000Glue$500 cont interceptassemb ly personnel$20 000Wagesfactory supervisor$3 500Factory cleaners wages$2 000Sales commissions$10 000Administrative staff salaries$4 000Depreciationfactory equipment$3 000Depreciationsales office equipment$1 000Utilities, insurancefactory$6 000Utilities, insurancesales office$2 000Advertising$8 000Total costs$90 000The manufacturing overhead isCorrect Answer $15 0006.Cost of Goods Manufactured = Beginning Work in Process + Total Manufacturing Costs resultant Work in Process. AnswerSelected Answer True7.When recording breed in the financial statements, the score standards prescribe that the companies use the lower of cost or net realisable value. AnswerSelected Answer True8.The Lots More Store has a Janitorial Department and a force Department that provide services to one-third Sales Departments. The Janitorial Department cost is allocated based on space and the Personnel Department cost is allocated based on employees. The following information is available.PersonnelJanitorial SalesSalesSalesDeptDept123Budget$45 000$30 000Space (sq m)4 0001 00020 00030 00050 000No. of Employees510154530Using the step-down method, calculate the amount of Janitorial Department cost allocated to Sales Department 2, if the Personnel Department is allocated first. AnswerSelected Answer$10 3509.Quality of conformance refers toAnswerSelected Answerthe degree to which the product meets its design specifications. 10.Which of the following is not an objective of management taleing? AnswerSelected AnswerProviding information for profit and loss statements11.Appraisal costs refer to costs incurredCorrect Answer in determining whether defects exist.12.Leisure Life manufactures a grade of sporting equipment. The firms predetermined overhead application rate was 150 per cent of direct labour cost. Job 101 included direct materials of $15 000 and direct labour of $6 000. The manufacturing overhead use to Job 101 during the year was AnswerSelected Answer$9 00013.Which of the following i s not a cost of quality?AnswerSelected AnswerProductive inefficiency cost14.If production increases, variable cost will Correct Answer remain constant on a per unit basis.15.The service department cost allocation method that fully accounts for the mutual provision of services between service departments is called the AnswerSelected Answerreciprocal method.16.Which of the following statements is correct?AnswerSelected AnswerCost accounting is a subset of management accounting.17.Richardson & Sons purchased direct material worth $15 000 during the most modern period. At the end of the period the direct material account correspondence was $6 000 larger than the outset balance. Cost of goods sold was $150 000. Overhead is applied at 50 per cent of direct labour cost. Other account balances areBeginningEndingWork in process$75 000$20 000Finished goods$one hundred ten 000$60 000What is the amount of prime cost added to production for the period? AnswerSelected Answer$33 00018.Product c osts compriseAnswerSelected Answerdirect materials, direct labour and manufacturing overhead.19.The flow of manufacturing costs through the system isAnswerSelected Answer stark naked materials inventory work in process inventory finished goods inventory cost of goods sold. 20.Whether a cost is classified as direct or indirect will depend on AnswerSelected Answerthe nature of the cost object AND whether the cost can be economically traced to the cost object. 21.Barrett Industries began the month of June with a finished goods inventory of $15 000. The finished goods inventory at the end of June was $10 000 and the cost of goods sold during the month was $20 000.The cost of goods manufactured during the month of June was AnswerSelected Answer$15 00022.In the manufacturing firm, inventories consist ofAnswerSelected Answerraw materials, work in process and finished goods.23.Which of the following statements is correct in relation to determining whether a cost is direct or indirect? Answe rSelected AnswerThe wider the definition of the cost object the more costs that will be direct costs. 24.Refer to the following data.Direct material used$150 000Selling costs$5 000Indirect labour$7 000Administrative costs$10 000Depreciation on factory equipment$70 000Direct labour$40 000Overtime premiums paid$20 000Indirect materials$45 000The prime costs areAnswerSelected Answer$190 00025.A courier company may regard kilometres driven as a possible cost driver. AnswerSelected Answer True26.Rappaport Corporation reported the following data for the month of FebruaryThe direct materials cost for February isAnswerSelected Answer$88,00027.During the month of frightful, direct labor cost totaled $13,000 and direct labor cost was 20% of prime cost. If total manufacturing costs during August were $88,000, the manufacturing overhead was AnswerSelected Answer$23,00028. Rappaport Corporation reported the following data for the month of FebruaryThe adjusted cost of goods sold that appears on the income statement for February is AnswerSelected Answer$240,00029.A partial listing of costs incurred at Peggs Corporation during September appears belowThe total of the period costs listed above for September is AnswerSelected Answer$318,00030.The following data pertain to Harriman Companys operations during JulyThe ending finished goods inventory wasAnswerSelected Answer$7,00031.For the current year, Paxman Company incurred $150,000 in actual manufacturing overhead cost. The Manufacturing Overhead account showed that overhead was overapplied in the amount of $6,000 for the year. If the predetermined overhead rate was $8.00 per direct labor-hour, how many hours were worked during the year? AnswerSelected Answer19,500 hours32.Management of Berndt Corporation has asked your sustain as an intern in preparing some key reports for August. The beginning balance in the raw materials inventory account was $33,000. During the month, the company made raw materials purchases amounting to $62,000. At the end of the month, the balance in the raw materials inventory account was $30,000. Direct labor cost was $46,000 and manufacturing overhead was $74,000. The beginning balance in the work in process account was $13,000 and the ending balance was $19,000. The beginning balance in the finished goods account was $54,000 and the ending balance was $50,000. Sales totaled $270,000. Selling put down was $18,000 and administrative expense was $49,000.The net operating income for August wasAnswerSelected Answer$20,00033.Management of Berndt Corporation has asked your help as an intern in preparing some key reports for August. The beginning balance in the raw materials inventory account was $33,000. During the month, the company made raw materials purchases amounting to $62,000. At the end of the month, the balance in the raw materials inventory account was $30,000. Direct labor cost was $46,000 and manufacturing overhead was $74,000. The beginning balance in the work in proce ss account was $13,000 and the ending balance was $19,000. The beginning balance in the finished goods account was $54,000 and the ending balance was $50,000. Sales totaled $270,000. Selling expense was $18,000 and administrative expense was $49,000.The cost of goods sold for August wasAnswerSelected Answer$183,00034.The corporate controllers salary would be considered a(n) AnswerSelected Answeradministrative cost.35.Choice of allocation base should be made based onAnswerSelected Answerwhether the base actually drives the cost being allocated.36.The three basic elements of manufacturing cost are direct materials, direct labor, and AnswerSelected Answermanufacturing overhead.37.An opportunity cost isAnswerSelected Answerthe benefit forgone by selecting one alternative instead of another. 38.Which terms below correctly describe the cost of the black blushing mushroom used to paint the dots on a pair of dice?AnswerSelected AnswerChoice B39.Buford Company rents out a small overbold p ortion of its factory to another company for $1,000 per month. The rental agreement will expire next month, and rather than renew the agreement Buford Company is thinking well-nigh using the space itself to store materials. The term to describe the $1,000 per month is AnswerSelected Answeropportunity cost.40.Cost of goods manufactured will usually includeAnswerSelected Answersome costs incurred during the prior period as well as costs incurred during the current period.