ACCT 346 Midterm Question 1. Question : (TCO 1) Which of the following is NOT a difference between Financial Accounting and Managerial Accounting?
Student Answer: Financial Accounting is concerned with the past, while Managerial Accounting is concerned with the future.
Managerial Accounting uses more non-monetary information than Financial Accounting.
Managerial Accounting is primarily concerned with providing information to external users, whereas Financial Accounting is concerned with providing information to internal users.
Financial Accounting must follow GAAP, while Managerial Accounting does not need to follow GAAP.
Question 2. Question : (TCO1) Josie- Grill budgeted the following costs for a month in which 1,500 steak dinners will be produced and sold: materials, $4,080; hourly labor (variable), $5,200; rent (fixed), $1,700; depreciation, $800; and other fixed costs, $600. Each steak dinner sells for $14.00 each. How much is the budgeted variable cost per unit?
Student Answer: $6.19
$8.25
$6.72
$5.80
Question 3. Question : (TCO 1) Which of the following costs is NOT part of manufacturing overhead?
Student Answer: Depreciation for the factory equipment
Electricity for the factory
Salaries for production supervisors
Health insurance for the sales staff
Question 4. Question : (TCO 1) On December 31, 2015, GLE Inc. has a balance in the Work-in-Process Inventory account of $62,000. At January 1, 2015, the balance was $47,000. Current manufacturing costs for the year are $292,000, and cost of goods sold is $284,000. How much is cost of goods manufactured?
Student Answer: $292,000
$299,000
$277,000
$285,000
Comments:
Question 5. Question : (TCO 2) Paul Company applies manufacturing overhead based on direct labor cost. Information concerning manufacturing overhead and labor for August follows.
Estimated Actual
Overhead cost $174,000 $171,000
Direct labor hours 5,800 5,900
Direct labor cost $87,000 $89,975
How much is the predetermined overhead rate?
Student Answer: $1.90
$30.00
$2.00
$1.93
Question 6. Question : (TCO 2) During 2015, Michael Company applied overhead using a job-order costing system at a rate of $12 per direct labor hours. Estimated direct labor hours for the year were 150,000, and estimated overhead for the year was $1,800,000. Actual direct labor hours for 20x1 were 140,000, and actual overhead was $1,700,000.
What is the amount of under- or over-applied overhead for the year?
Student Answer: $100,000 under-applied
$20,000 under-applied
$100,000 over-applied
$120,000 over-applied
Question 7. Question : (TCO 2) Manufacturers follow four steps to implement a manufacturing overhead allocation system. What is the first step?
Student Answer: Select an allocation base and estimate the total amount that will be used during the year.
Allocate some manufacturing overhead to each individual job.
Calculate a predetermined manufacturing overhead rate.
Estimate total manufacturing overhead costs for the coming year.
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1. Question : (TCO 1) Which of the following topics is the focus of managerial accounting?
Student Answer: Financial statements and other financial reports
Historical cost principles
The needs of creditors
The needs of the organization's internal parties
Instructor Explanation: Managerial accounting focuses on the needs of internal users (managers) and on data relevant for decision making.
Points Received: 7 of 7
Comments:
Question 2. Question : (TCO 6) In an activity-based costing system, cost reduction is accomplished by identifying and eliminating:
All Cost Drivers Non-Value-Adding Activities
Student Answer: No No
Yes Yes
No Yes
Yes No
Question 3. Question : (TCO 3) Kerner Manufacturing uses a process cost system to manufacture laptop computers. The following information summarizes operations relating to laptop computer model #KJK20 during the quarter ending March 31:
Units Direct Labor
Work-in-process inventory, January 1 300 $50,000
Started during the quarter 800
Completed during the quarter 600
Work-in-process inventory, March 31 100
Costs added during the quarter $720,000
Beginning work-in-process inventory was 50% complete for direct labor costs. Ending work-in-process inventory was 75% complete for direct labor costs. What is the equivalent amount of units of production using the weighted-average unit cost inventory valuation method?
Student Answer: 600
650
725
675
Question 4. Question : (TCO 2) Sweet Co. uses budgeted overhead rates to apply overhead to individual jobs. They use a system based on direct labor hours. Last year, the company made the following estimates for this year.
Direct labor costs $48,000,000
Factory overhead costs $6,400,000
Direct Labor Hours 80,000
Machine Hours 110,000
(a) What is the budgeted overhead rate for the company?
(b) If Job #34567 had the following:
Material costs were $500,000;
Direct labor costs were $450,000;
Direct labor hours were 25,000; and
Machine hours were 36,000,
then what is the total cost of Job #34567?
Question 5. Question : (TCO 3) Adnan Company uses process costing. At the beginning of the month, there were 3,000 units in process, 70% complete with respect to material, and 60% complete with respect to conversion costs. 20,000 units were started during the month and 20,000 units were completed. The units in ending Work-In-Process Inventory were 90% complete with respect to material and 30% complete with respect to conversion costs. How many equivalent units will be used in calculating the cost per unit for materials?
. (TCO 6) Handy Display Company manufactures display cases to be sold to retail stores. The cases come in three sizes: large, medium, and small. Currently, Handy Display Company uses a single plant-wide overhead rate to allocate its $3,357,800 of annual manufacturing overhead. Of this amount, $820,000 is associated with the Large Case line, $1,276,800 is associated with the Medium Case line, and $1,261,000 is associated with the Small Case line. Handy Display Company is currently running a total of 33,000 machine hours: 10,000 in the Large Case line, 13,300 in the Medium Case line, and 9,700 in the Small Case line. Handy Display Company uses machine hours as the cost driver for manufacturing overhead costs.
Requirement: Calculate the departmental overhead rate for each of the three departments listed. (Points : 30)
Question 6. Question : (TCO 6) Handy Display Company manufactures display cases to be sold to retail stores. The cases come in three sizes: large, medium, and small. Currently, Handy Display Company uses a single plant-wide overhead rate to allocate its $3,357,800 of annual manufacturing overhead. Of this amount, $1,000,000 is associated with the Large Case line, $1,560,000 is associated with the Medium Case line, and $1,485,000 is associated with the Small Case line. Handy Display Company is currently running a total of 50,000 machine hours: 20,000 in the Large Case line, 24,000 in the Medium Case line, and 15,000 in the Small Case line. Handy Display Company uses machine hours as the cost driver for manufacturing overhead costs.
Requirement: Calculate the departmental overhead rate for each of the three departments listed.
Question 7. Question : (TCO 2) Fred Co. incurred costs of $900,000 for direct materials (raw) purchased. Direct labor was $10,000 and factory overhead was $10,000 for March.
Inventories were as follows:
raw materials beginning $1,000; raw materials ending $2,000
work-in-process beginning $190,000; work-in-process ending $170,000
finished goods beginning $10,000; finished goods ending $10,500
What is the cost of goods manufactured? Please show your work.
USA 
India