27 May Question Which of the following is considered to be an advantage of using both non
Question
Which of the following is considered to be an advantage of using both nonfinancial and financial information in the balanced scorecard? (Points : 2)
Nonfinancial information is most helpful in analyzing a company’s past performance, while financial information is most useful in evaluating potential future performance.
Nonfinancial information provides the short-term perspective while financial information provides the long-term perspective of performance.
Nonfinancial information reflects the company’s current and potential competitive advantage, while financial information tends to focus on a firm’s achieved financial performance.
Nonfinancial information should be included with financial information because it is more reliable than financial information.
Question 2.2. Which of the following tend to be non-differential in the short term since they cannot be changed, but are more likely to be differential in the long term? (Points : 2)
Fixed costs.
Variable costs.
Mixed costs.
Semi-variable costs.
Question 3.3. When managers produce value for the customer, their orientation consists of all the following except: (Points : 2)
Quality and Service.
Timeliness of delivery.
The ability to respond to the customer’s desire for specific features.
State of the art manufacturing facilities.
Question 4.4. Target costing determines the desired cost for a product upon the basis of a given competitive price such that the product will: (Points : 2)
Earn at least a small profit.
Earn a desired profit.
Earn the maximum profit.
Break even.
Question 5.5. Over the past several years it has become increasingly important for firms to improve achievement towards their social and environmental responsibilities. What is the best way the management accountant can help the firm improve on sustainability? (Points : 2)
Participate in programs of environmental organizations.
Develop and implement a legal staff and public relations staff for dealing with sustainability issues that may affect the firm.
Develop and implement a sustainability scorecard.
Risk management.
Question 6.6. Factory overhead costs for a given period were 2 times as much as the direct material costs. Prime costs totaled $8,000. Conversion costs totaled $11,350. What are the direct labor costs for the period? (Points : 2)
$4,650.
$3,560.
$4,200.
$3,860.
Question 7.7. Tierney Construction, Inc. recently lost a portion of its financial records in an office theft. The following accounting information remained in the office files:
COGS = $80,000
WIP Inventory – January 1. = $18,500
WIP Inventory – December 31 = $14,500
Selling & Administrative Expenses = $16,000
Net Income = $30,000
Factory O/H = $20,000
Direct Materials Inventory, January 1= $26,000
Direct Materials Inventory, December 31= $14,000
COGM = $98,000
Finished Goods Inventory, January 1 = 31,000
Direct labor cost incurred during the period amounted to 2.5 times the factory overhead. The CFO of Tierney Construction, Inc. has asked you to recalculate the following accounts and to report to him by the end of tomorrow.
What should be the amount in the finished goods inventory at December 31, 2013? (Points : 2)
$55,500.
$35,000.
$43,000.
$49,000.
Question 8.8. The journal entry to record requisitioned and usage of direct materials would include a credit to: (Points : 2)
Work-in-Process Inventory.
Accrued Payroll.
Factory Overhead.
Materials Inventory.
Finished Goods Inventory.
Question 9.9. Abnormal spoilage: (Points : 2)
Is considered part of good production.
Arises under efficient operating conditions.
Is controllable in the short run.
Is unacceptable spoilage that should not occur under efficient operating conditions.
Is part of inventory product cost.
Question 10.10. Which of the following is most likely to be the cost driver for the packaging and shipping activity? (Points : 2)
Number of setups.
Number of components.
Number of orders.
Hours of testing.
Number of production runs.
Question 11.11. The ideal criterion for choosing an allocation base for overhead is: (Points : 2)
Ease of calculation.
A cause-and-effect relationship.
Ease of use.
Its preciseness.
Question 12.12. An activity that is performed to support the production of a new custom-order product is a(n): (Points : 2)
Product-level activity.
Facility-level activity.
Unit-level activity.
Customer-support activity.
Batch-level activity.
Question 13.13. The objectives of cost allocation are to: (Points : 2)
Motivate, provide incentives, and determine fair rewards.
Accurately define, divide and spread direct costs.
Value, measure, and interpret cost data.
Connect, communicate, and discern information.
Define, refine, and re-define indirect costs.
Question 14.14. ABC Company uses a Materials Inventory account to record both direct and indirect materials. ABC charges direct materials to WIP, while indirect materials are charged to the Factory Overhead account. During the month of April, the company has the following cost information:
Total Materials (Direct and Indirect) Purchased = $ 90,000
Indirect Materials Issued to Production = 30,000
Total Materials Issued to Production = 110,000
Beginning Materials Inventory = 50,000
The debit to Work-in-Process Inventory account for materials is: (Points : 2)
$110,000.
$30,000.
$90,000.
$80,000.
Question 15.15. The cost allocation method most widely used because of its accuracy and ability to provide a detailed level of analysis is: (Points : 2)
Departmental approach.
Activity-based approach.
Direct approach.
Accounting approach.
Joint product costing.
Question 16.16. Firm X has a production process that has a total joint cost of $15,000. At the split-off point, there are 2,000 pounds of Product 1 and 3,000 pounds of Product 2. What is the cost per pound of Product 1 using the physical measure method? (Points : 2)
$2.50.
$3.00.
$3.50.
$4.00.
Question 17.17. Which one of the following methods uses units of output to allocate joint costs to joint products? (Points : 2)
Net realizable value method.
Physical units method.
Net sales value method.
Sales value at split-off method.
Question 18.18. Cost-volume-profit (CVP) relationships that are curvilinear may be analyzed linearly by considering only: (Points : 2)
Fixed and semi-variable costs.
Relevant fixed costs.
Relevant variable costs.
A relevant range of volume.
The multi-product/multi-service context.
Question 19.19. The point in a joint production process at which individual products can be identified for the first time is called the: (Points : 2)
Separable point.
By-pass point.
Split-off point.
Joint identification point.
Question 20.20. Cleaning Care Inc. expects to sell 10,000 mops. Fixed costs (for the year) are expected to be $10,000, unit sales price is expected to be $12, and unit variable costs are budgeted at $7.
Cleaning Care’s margin of safety (MOS) in units is: (Points : 2)
1,000.
2,000.
4,000.
8,000.
9,000.
Question 21.21. Variable costs will generally be relevant for decision making because they: (Points : 2)
Differ between options.
Are volume-based.
Have not been committed and differ between options.
Differ between options and have been committed.
Measure opportunity cost.
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