Accounting Exam 4
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The exams are finally here but you still have doubts on whether you are a hundred percent prepared. The quiz below is designed to cool your nerves and point out the topics you haven’t grasped fully. Give it a try and all the best as you become a certified accountant.
- 1.The cost of a manufactured product generally consists of which of the following costs?
- A.
Direct materials cost and factory overhead cost
- B.
Direct labor cost and factory overhead cost
- C.
Direct labor cost, direct materials cost, and factory overhead cost
- 2.Which of the following costs are referred to as conversion costs?
- A.
Direct labor cost and factory overhead cost
- B.
Direct materials cost and direct labor cost
- C.
Factory overhead cost
- 3.What term is used to refer to the cost of changing direct materials into a finished manufactured product
- A.
Factory overhead cost
- B.
Period cost
- C.
Conversion cost
- 4.Which of the following is considered a part of factory overhead cost?
- A.
Sales commissions
- B.
Depreciation of factory buildings
- C.
Deprectation of office equipment
- 5.Which of the following manufacturing cos is an indirect cost of producing a product?
- A.
Oil lubricants used for factory machinery
- B.
Commissions for sales personnel
- C.
Hourly wages of an assembly worker
- 6.Which of the following are the two main types of cost accounting systems for manufacturing operations?
- A.
Process cost and general accounting systems
- B.
Job order cost and process cost systems
- C.
Job order and genral accounting systems
- 7.Which of the following costs are NOT included in finished goods inventory?
- A.
Direct labor
- B.
Factory overhead
- C.
Company president's salary
- 8.At the end of the fiscal year, the balance in factory overhead is small. this balance would normally be?
- A.
Transferred to work in progress
- B.
Transferred to cost of goods sold
- C.
Transferred to finished goods
- 9.Each account in the cost ledger is called a?
- A.
Finished good sheet
- B.
Stock record
- C.
Job cost sheet
- 10.What was the balance of work i process as of april 30?
- A.
8,100
- B.
22,900
- C.
29,900
- 11.If the amount of factory overhead cost incurred exceeds the amount applied, the factory overhead account will have a
- A.
Debit balance and be underapplied
- B.
Debit balance and be oberabsorbed
- C.
Credit balance and be overapplied
- 12.The recording of the jobs completed would include a credit to
- A.
Factory overhead
- B.
Finished goods
- C.
Work in process
- 13.The recording of the jobs shipped and customers billed would include a credit to
- A.
Accounts payable
- B.
Cash
- C.
Finished goods
- 14.The finished goods account is the controlling account for the
- A.
Materials ledger
- B.
Work in process ledger
- C.
Stock ledger
- 15.
- A.
The difference between actual unit price or unit cost and the planned unit price or cost, multiplied by the planned quantity sold
- B.
The difference between actual unit price or unit cost and the planned unit price or cost, multiplied by the actual quantity sold
- C.
The difference between the actual quantity sold and the planned quantity sold, multiplied by the planned unit sales price or unit cost
- 16.If variable cost of goods sold totaled $80,000 for the year (16,000 units at $5 each) and the planned variable cost of goods sold totaled $84,000 (15,000 units at $5.60 each), the effect of the unit cost factor on the change in variable cost of goods sold is
- A.
5,000
- B.
9,600
- C.
5,600
- 17.If variable selling and administrative expenses totaled $120,000 for the year (80,000 units at $1.50 each) and the planned variable selling and administrative expenses totaled $120,900 (78,000 units at $1.55 each), the effect of the unit cost factor on the change in variable selling and administrative expenses is
- A.
900 decrease
- B.
4,000 decrease
- C.
3,100 decrease
- 18.Under which inventory costing method could increases of decreases in income from operations be misinterpreted to be the result of operating efficiencies or inefficiencies
- A.
Variable costing
- B.
Absorption costing
- C.
Incremental costing
- 19.The selling price of a product may be just above the variable costs and expenses of making and selling it in
- A.
The long run
- B.
The short run
- C.
Both short run and long run
- 20.The relative distribution of sales among various products sold is referred to as the
- A.
Joint product mix
- B.
Profit mix
- C.
Sales mix
- 21.The contribution margin ration is computed as
- A.
Sales divided by contribution margin
- B.
Contribution margin divided by sales
- C.
Contribution margin divided by costs of sales
- 22.For a supervisor of a manufacturing department, which of the following costs are controllable?
- A.
Direct materials
- B.
Insurance of factory building
- C.
Depreciation of factory building
- 23.In the variable costing income statement, deduction of variable selling and administrative expenses from manufacturing margin yields
- A.
Differential margin
- B.
Contribution margin
- C.
Gross profit
- 24.A business operated at 100% of capacity during its first month and incurred the following costs:if 1,600 units remain unsold at the end of the month, what is the amount of inventory that would be reported on the variable costing balance sheet (49)
- A.
64,000
- B.
56,000
- C.
66,400
- 25.A business operated at 100% of capacity during its first month and incurred the following costs:if 2,000 units remain unsold at the end of the month and sales total $300,000 for the month, what is the amount of income from operations reported on the variable costing income statement? (50)
- A.
100,000
- B.
114,800
- C.
140,000
- 26.Which of the following would be included in the cost of a product manufactured according to variable costing?
- A.
Property taxes on factory buildings
- B.
Interest expense
- C.
Direct materials
- 27.
- A.
$11,000
- B.
$110
- C.
$11
- 28.Costs that are treated as assets until the product is sold are called:
- A.
Product costs
- B.
Conversion costs
- C.
Selling expenses
- 29.For the manufacturing business, inventory which is in the process of being manufactured is referred to as:
- A.
Finished goods inventory
- B.
Work in process inventory
- C.
Direct materials inventory
- 30.Which of the following would probably not be found in the accounting system of a service provider?
- A.
Deferred revenue account
- B.
Job cost sheets
- C.
Finished jobs ledger
- 31.The direct labor and overhead costs of providing services to clients are accumulated in:
- A.
Work in process
- B.
Overhead
- C.
Finished services expense
- 32.Which of the following activity bases would be the most appropriate for food costs of a hospital?
- A.
Number of x-rays taken
- B.
Number of patients who stay in the hospital
- C.
Number of scheduled surgeries
- 33.Which of the following activity bases would be the most appropriate for gasoline costs of a delivery service, such as United Postal Service?
- A.
Number of miles driven
- B.
Number of trucks employed
- C.
Number of packages delivered
- 34.Which of the following is NOT an example of a cost that varies in total as the number of units produced changes?
- A.
Straight-line depreciation on factory equipment
- B.
Wages of assembly worker
- C.
Direct materials cost
- 35.Which of the following is NOT an example of a cost that varies in total as the number of units produced changes?
- A.
Wages of assembly worker
- B.
Insurance premiums on factory building
- C.
Direct materials cost
- 36.A cost that has characteristics of both a variable cost and a fixed cost is called a:
- A.
Sunk cost
- B.
Mixed cost
- C.
Discretionary cost
- 37.Which of the following costs is a mixed cost?
- A.
Straight-line depreciation on factory equipment
- B.
Electricity costs of $2 per kilowatt-hour
- C.
Rental costs of $5,000 per month plus $.30 per mile per machine hour of use
- 38.In cost-volume profit analysis, all costs are are classified into the following two categories:
- A.
Variable costs and fixed costs
- B.
Mixed costs and variable costs
- C.
Sunk costs and fixed costs
- 39.If fixed costs are $250,000, the unit selling price is $20, and the unit variable costs are $16, what is the break-even sales if fixed costs are reduced by $40,000?
- A.
52,500 units
- B.
64,500 units
- C.
60,500 units
- 40.If fixed costs are $250,000, the unit selling price is $20, and the unit variable costs are $16, what is the break-even sales if fixed costs are increased by $40,000?
- A.
60,500 units
- B.
62,500 units
- C.
72,500 units
- 41.If fixed costs are $450,000, the unit selling price is $75, and the unit variable costs are $50, what are the old and new break-even sales if the unit selling price increases by $5?
- A.
9,000 units and 6,000 units
- B.
18,000 units and 15,000 units
- C.
9,000 units and 15,000 units
- 42.
- A.
$2,577,777
- B.
$2,400,000
- C.
$2,533,350
- 43.If fixed costs increased and variable costs per unit decreased, the break-even point would:
- A.
Increase
- B.
Decrease
- C.
Increase, decrease, or remain the same, depending upon the amounts of increase in fixed cost and decrease in variable cost.
- 44.
- A.
Total fixed costs increase
- B.
Unit variable cost decreases
- C.
Unit variable cost increases
- 45.The point where the sales line and the total costs line intersect on the cost-volume profit chart represents:
- A.
The break-even point
- B.
The maximum possible operating income
- C.
The total fixed costs
- 46.Assuming that last years fixed costs totaled $910,000, what was Phillips Co's break-even point in units?
- A.
28,000 units
- B.
35,000 units
- C.
40,000 units
- 47.If a business had a capacity of $10,000,000 of sales, actual sales of $6,000,000, break-even sales of $4,500,000, fixed costs of $1,800,000, and variable costs of 60% of sales, what is the margin of safety expressed as a percentage of sales?
- A.
25%
- B.
15%
- C.
33.3%
- 48.If a business had a margin of safety ratio of 20%, variable costs of 75% of sales, fixed costs of 240,000, a break-even point of 960,000, and operating income of 60,000 for the current year, what are the current years sales?
- A.
$1,020,000
- B.
$1,200,000
- C.
$1,260,000
- 49.Cost-volume -profit analysis cannot be used if which of the following occurs?
- A.
The total fixed costs change
- B.
Per unit sales prices change
- C.
Costs cannot be properly classified into fixed and variable costs
- 50.Under absorption costing, which of the following costs would not be included in finished goods inventory?
- A.
Variable and fixed selling and administrative expenses
- B.
Variable and fixed factory overhead cost
- C.
Direct materials cost
- 51.Under variable costing, which of the following costs would not be included in finished goods inventory?
- A.
Variable factory overhead cost
- B.
Fixed factory overhead cost
- C.
Direct labor cost
- 52.Which of the following would be included in the cost of a product manufactured according to absorption costing?
- A.
Sales salaries
- B.
Advertising expense
- C.
Office supplies costs
- 53.Under variable costing, which of the following would be included in finished goods inventory?
- A.
Straight-line depreciation on factory equipment
- B.
Wages of carpenters in a furniture factory
- C.
Advertising costs
- 54.Which of the following would be included in the cost of a product manufactured according to variable costing?
- A.
Sales commissions
- B.
Direct materials
- C.
Interest expense
- 55.In contribution margin analysis, the increase or decrease in unit sales price or unit cost on the number of units sold is referred to as the:
- A.
Cost of goods sold factor
- B.
Unit price or unit cost factor
- C.
Quantity factor
- 56.The amount of income under absorption costing will be more than the amount of income under variable costing when units manufactured:
- A.
Are less than units sold
- B.
Exceed units sold
- C.
Equal units sold
- 57.On the variable costing income statement, the figure representing the difference between manufacturing margin and contribution margin is the:
- A.
Fixed manufacturing costs
- B.
Fixed selling and administrative expenses
- C.
Variable selling and administrative expenses
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