devry acct346 midterm exam done on june 2015

Question 1. Question : (TCO 1) The goal of managerial accounting is to provide information that managers need for which of the below?

Planning

Control

Decision making

All of the above

Question 2. Question : (TCO1) Josie’s 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?

$6.19

$8.25

$6.72

$5.80

Question 3. Question : (TCO 1) Which of the following is NOT a period cost?

Advertising cost

Direct Material

Accounting staff salaries

Depreciation on accounting office equipment

Question 4. Question : (TCO 1) On December 31, 2015, GLE Inc. has a balance in the Work-in-Process Inventory account of $55,000. On January 1, 2015, the balance was $62,000. Current manufacturing costs for the year are $292,000, and cost of goods sold is $284,000. How much is cost of goods manufactured?

$292,000

$299,000

$277,000

$285,000

Question 5. Question : (TCO 2) Paul Company applies manufacturing overhead based on direct labor hours. 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?

$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?

$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. Which step is notperformed before the year begins?

Allocate some manufacturing overhead to each individual job.

Select an allocation base and estimate the total amount that will be used during the year.

Estimate total manufacturing overhead costs for the coming year.

Calculate a predetermined manufacturing overhead rate.

Question 1. Question : (TCO 1) Which of the following types of costs are prime costs?

Direct materials and direct labor

Direct materials and overhead

Direct labor and overhead

Direct materials, direct labor, and overhead

Question 2. Question : (TCO 6) In an activity-based costing system, cost reduction is accomplished by identifying and eliminating:

Non-Value-Adding Activities All Cost Drivers

No No

Yes Yes

Yes No

No 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?

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 $42,000,000

Factory overhead costs $7,500,000

Direct Labor Hours 150,000

Machine Hours 100,000

(a) What is the budgeted overhead rate for the company?

(b) If Job #34567 had the following:

Material costs were $400,000;

Direct labor costs were $300,000;

Direct labor hours were 15,000; and

Machine hours were 20,000,

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 6,000 units in process, 80% complete with respect to material and 70% complete with respect to conversion costs. 30,000 units were started during the month and 30,000 units were completed. The units in ending Work-In-Process Inventory were 80% complete with respect to material and 20% complete with respect to conversion costs. How many equivalent units will be used in calculating the cost per unit for materials?

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 $800,000 for direct materials (raw) purchased. Direct labor was $5,000 and factory overhead was $15,000 for March.

Inventories were as follows:

Raw materials beginning $2,000; raw materials ending $4,000;

Work-in-process beginning $210,000; work-in-process ending $190,000;

Finished goods beginning $13,000; finished goods ending $12,500;

What is the cost of goods manufactured? Please show your work.