Smallest component of total manufacturing cost

Smallest component of total manufacturing cost 

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.

 

Indirect materials have one of two characteristics

 

·         They do not physically become part of the finished product or (2) they cannot be traced because their physical association with the finished product is too small in terms of cost

 

list 3 manufacturing costs

 

·         direct materials
direct labor
manufacturing overhead

 

On average, studies have shown that the smallest component of total manufacturing cost is

 

·         direct labor

 

Manufacturers add beginning finished goods inventory to cost of goods manufactured and subtract ending finished goods inventory to compute ?

 

·         the cost of goods sold

 

Which of the following would you find on the income statement of a manufacturing company, but not on the income statement of a merchandising company?

 

·         cost of goods manufactured

 

Cost of goods available for sale is reported on the income statement of

 

·         a merchandising company and a manufacturing company.

 

Manders Corporation has $20,000 of ending finished goods inventory at December 31. If beginning finished goods inventory was $15,000 and cost of goods sold was $40,000, how much would Manders Corporation report as cost of goods manufactured?

 

·         45000

 

The costs assigned to beginning work in process inventory are based on the manufacturing costs incurred

 

·         in the prior period

 

The costs assigned to beginning work in process inventory are based on the manufacturing costs incurred

 

·         in the prior period

 

A cost of goods manufactured schedule shows beginning and ending inventories for

 

·         raw materials and work in process only.

 

The formula to determine the cost of goods manufactured is

 

·         beginning work in process inventory + total manufacturing costs - ending work in process inventory

 

The sum of the direct materials costs, direct labor costs, and manufacturing overhead incurred is the

 

·         total manufacturing costs

 

Companies compute cost of goods manufactured by subtracting ending work in process inventory from

 

·         total cost of work in process

 

Manufacturing companies report inventories in the order of?

 

·         liquidity

 

Finished goods is to a ____________ what merchandise inventory is to a _______.

 

·         Manufacturer

·        
merchandiser

 

A manufacturer may report three inventories in its balance sheet: (1) raw materials, (2) work in process, and (3) finished goods. Indicate in what sequence these inventories generally appear on a balance sheet.

 

·         3,2,1

 

Which one of the following is a trend in industry?

 

·         The U.S. economy has shifted toward an emphasis on providing services.

 

Which one of the following is a trend in managerial accounting?

 

·         Large machines have been replaced with smaller, more flexible ones.