A Quiz That’ll Add To Your Knowledge Of Accounting

26 Questions | By AllAmericanOne | Updated: Mar 20, 2022 | Attempts: 165

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A Quiz Thatll Add To Your Knowledge Of Accounting - Quiz

Trading, profit and loss account shows the income and expenditure of a company and this will define the financial position on whether the company is making a profit or incurring some losses. This information will help the company or redefine on how to operate. This quiz will add to your knowledge of accounting. Good luck!

Questions and Answers

1.

Preparing budgets is an example of the managent function of:
- A.
  
  Controlling
- B.
  
  Decision-making
- C.
  
  Directing
- D.
  
  Planning
2.

Which of the following groups are external users of financial information
- A.
  
  Customers of the company
- B.
  
  Vendors of the company
- C.
  
  Potential investors of the company
- D.
  
  All of the above
3.

Which of the following is TRUE?
- A.
  
  Managerial accounting reports are audited by CPAs
- B.
  
  Managerial accounting reports provide detailed internal information
- C.
  
  Managerial accounting reports aid potential investors
- D.
  
  Managerial accounting reports must follow GAAP
4.

The primary goal of financial accounting is to provide infomation for:
- A.
  
  Potential investors
- B.
  
  Creditors
- C.
  
  Governmental regulators
- D.
  
  All of the above
5.

Which of the following is an example of overhead in a factory?
- A.
  
  Wages of machine operators
- B.
  
  Wages of factory maintenance personnel
- C.
  
  Wages of administrators in the corporate office
- D.
  
  Salaries of salespersons
6.

Which of the following statements is true regarding the salary of the manager of a fast food hamburger restaurant?
- A.
  
  The salary is a fixed cost that is directly traceable to the cost of making hamburgers
- B.
  
  The salary is a fixed cost that is directly traceable to the cost of operating a specific restaurant
- C.
  
  The salary is a variable cost that cannot be traced to the cost of operating a specific restaurant
- D.
  
  None of the aboce
7.

Use the following information for the next three questions: Comfy Furniture Company manufactures furniture at its Akron, Ohio, factory. Some of its costs from the past year include: Depreciation on sales office $ 11,000 Depreciation on factory equipment $ 16,000 Factory supervisor salary $ 52,500 Sales commissions $ 23,000 Lubricants used in factory equipment $ 3,000 Insurance costs for factory $ 21,000 Wages paid to maintenance workers $ 115,000 Fabric used to upholster furniture $ 7,000 Costs of delivery to customers $ 9,000 Wages paid to assembly-line workers $ 132,500 Lumber used to build product $ 72,000 Utilities in factory $ 44,500 Utilities in sales office $ 26,500 Manufacturing overhead costs for Comfy Furniture Company totaled:
- A.
  
  $324,000
- B.
  
  $122,000
- C.
  
  $228,000
- D.
  
  $252,000
8.

When manufacturing products, which of the following is an example of an inventoriable product cost?
- A.
  
  Depreciation on office equipment
- B.
  
  Depreciation on store building
- C.
  
  Depreciation on factory equipment
- D.
  
  Sales salaries exepenses
9.

Active Apparel Company reports the following data for its first year of operation (000s omitted). Cost of goods manufactured $500,000 Work in process inventory, beginning 0 Work in process inventory, ending 120,000 Direct materials used 85,000 Manufacturing overhead 100,000 Finished goods inventory, ending 72,000 What is the cost of goods sold?
- A.
  
  $500,000
- B.
  
  $428,000
- C.
  
  $685,000
- D.
  
  $548,000
10.

When manufacturing products, direct labor and direct materials are classified as:
- A.
  
  Period costs and expensed when incurred
- B.
  
  Period costs and expensed when the goods are sold
- C.
  
  Product costs and expensed when incurred
- D.
  
  Product costs and expensed when the goods are sold
11.

Rent on a factory building would be considered to be:
- A.
  
  A direct cost
- B.
  
  A period cost
- C.
  
  A product cost
- D.
  
  None of the above
12.

Which of the following costs would appear on the income statements for both a merchandiser and manufacturer?
- A.
  
  Cost of goods manufactured
- B.
  
  Direct labor incurred
- C.
  
  Direct materials used
- D.
  
  Cost of goods sold
13.

Manufacturing overhead would include:
- A.
  
  Indirect labor costs only
- B.
  
  All manufacturing costs except direct materials and direct labor
- C.
  
  All manufacturing costs
- D.
  
  Indirect materials only
14.

Which of the following is most likely NOT to use process costing?
- A.
  
  DuPont Chemical
- B.
  
  Ashley Custom Furnishings
- C.
  
  Exxon-Mobile (gasoline)
- D.
  
  General Mills ( cereal)
15.

What type of product costing system would a manufacturer plywood include?
- A.
  
  Job Costing
- B.
  
  Process Costing
- C.
  
  Either job or process
- D.
  
  Both job and process
16.

Before the year began, Johnson Manufacturing estimated that manufacturing overhead for the year would be $160,000 and that 12,000 direct labor hours would be worked. Actual results for the year included the following: Actual manufacturing overhead cost $175,000 Actual direct labor hours 15,000 The predetermined manufacturing overhead rate per direct labor hour is closest to:
- A.
  
  $13.33
- B.
  
  $10.67
- C.
  
  $11.67
- D.
  
  $14.58
17.

Before the year began, Johnson Manufacturing estimated that manufacturing overhead for the year would be $160,000 and that 12,000 direct labor hours would be worked. Actual results for the year included the following: Actual manufacturing overhead cost $175,000 Actual direct labor hours 15,000 The amount of manufacturing overhead allocated for the year based on direct labor hours would have been:
- A.
  
  $160,000
- B.
  
  $167,500
- C.
  
  $175,000
- D.
  
  $200,000
18.

Use the following data to answer the next three questions: Data below pertains to Garrett Company’s most recently completed fiscal year before any adjustments for overallocated or underallocated overhead were made: Estimated manufacturing overhead $ 240,000 Factory utilities $ 29,100 Estimated labor hours 35,000 Indirect labor $ 23,500 Actual direct labor hours 36,000 Sales commissions $ 53,700 Estimated direct labor cost $ 300,000 Factory rent $ 49,200 Actual direct labor cost $ 320,000 Factory property taxes $ 28,100 Factory depreciation $ 67,200 Indirect materials $ 33,000 If the company allocates manufacturing overhead based on direct labor cost, what are the allocated manufacturing overhead costs?
- A.
  
  $240,000
- B.
  
  $256,000
- C.
  
  $230,100
- D.
  
  $400,000
19.

Use the following data to answer the next three questions: Data below pertains to Garrett Company’s most recently completed fiscal year before any adjustments for overallocated or underallocated overhead were made: Estimated manufacturing overhead $ 240,000 Factory utilities $ 29,100 Estimated labor hours 35,000 Indirect labor $ 23,500 Actual direct labor hours 36,000 Sales commissions $ 53,700 Estimated direct labor cost $ 300,000 Factory rent $ 49,200 Actual direct labor cost $ 320,000 Factory property taxes $ 28,100 Factory depreciation $ 67,200 Indirect materials $ 33,000 Actual overhead incurred during the year totaled
- A.
  
  $230,100
- B.
  
  $300,000
- C.
  
  $283,800
- D.
  
  $240,000
20.

Use the following data to answer the next three questions: Data below pertains to Garrett Company’s most recently completed fiscal year before any adjustments for overallocated or underallocated overhead were made: Estimated manufacturing overhead $ 240,000 Factory utilities $ 29,100 Estimated labor hours 35,000 Indirect labor $ 23,500 Actual direct labor hours 36,000 Sales commissions $ 53,700 Estimated direct labor cost $ 300,000 Factory rent $ 49,200 Actual direct labor cost $ 320,000 Factory property taxes $ 28,100 Factory depreciation $ 67,200 Indirect materials $ 33,000 At the end fo the period and before any adjustments are made, overhead would be
- A.
  
  Underallocated by $25,900
- B.
  
  Overallocated by $25,900
- C.
  
  Overallocated by $16,000
- D.
  
  Underallocated by $9,900
21.

Mountain Made quilts had a predetermined overhead allocation rate of $5.00 per direct labor hour. If 5 direct laborers worked 1 ½ hours each to make a batch of 10 quilts, how much total overhead would be allocated to the batch of quilts?
- A.
  
  $7.50
- B.
  
  $37.50
- C.
  
  $30.00
- D.
  
  $75.00
22.

Assume that the total cost for the batch of 10 quilts made above in #10 was $400. If Mountain Made wants to earn a gross profit of 40% on each quilt, what price should be charged for each quilt?
- A.
  
  $160
- B.
  
  $16
- C.
  
  $56
- D.
  
  $560
23.

Job 2301 requires $12,000 of direct materials, $5,000 of direct labor, 500 direct labor hours, and 300 machine hours. Manufacturing overhead is computed at $15 per direct labor hour used and $12 per machine hour used. The total cost of Job 1547 is:
- A.
  
  $28,100
- B.
  
  $11,100
- C.
  
  $17,000
- D.
  
  $24,500
24.

If manufacturing overhead has been overallocated during the period, and most of the jobs produced have been sold, then:
- A.
  
  Cost of goods sold should be decreased
- B.
  
  Cost of goods sold should be increased
- C.
  
  Finished goods inventory should be increased
- D.
  
  Work in process inventory should be decreased
25.

The requisition of direct and indirect materials into production:
- A.
  
  Reduced finished goods inventory
- B.
  
  Reduces manufacturing overhead
- C.
  
  Reduces raw materials inventory
- D.
  
  Reduces work in process inventory