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Exam 15: Managerial Accounting Concepts and Principles

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Question 51

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Indirect labor would be included in factory overhead.

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Question 52

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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
D) Direct labor cost

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Question 53

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Which of the following is not a characteristic of useful managerial accounting reports?

Classify the following costs as either a product cost or a period cost:

Indirect labor and indirect materials are classified as:

Only the value of the inventory that is sold will appear in the income statement.

Accounting designed to meet the needs of decision-makers inside the business is referred to as:

A report analyzing the dollar savings of purchasing new equipment to speed up the production process is a managerial accounting report.

Control is the process of monitoring operating results and comparing actual results with the expected results.

Sineath Industries had a fire and some of its accounting records were destroyed. Available information is presented below for the year ended December 31, 2011.

Controlling deals with choosing goals and deciding how to achieve them.

Factory overhead is an example of a product cost.

The controller's staff often consists of several management accountants. All of the following would most likely be on the controller's staff EXCEPT:

All of the following would probably be considered a direct material except:

Accounting is an information system that provides essential data about the economic activities of an entity to various users to aid them in making informed judgments and decisions.

Sienna Company has the following information for January.

The cost of wages paid to employees directly involved in the manufacturing process in converting materials into finished product is classified as:

Factory overhead cost is sometimes referred to as factory burden.

At the beginning of 2011, the Gilbert Company's work in process inventory account had a balance of $30,000. During 2011, $68,000 of direct materials were used in production, and $66,000 of direct labor costs were incurred. Factory overhead in 2011 amounted to $90,000. Cost of goods manufactured is $230,000 in 2011. The balance in work in process inventory on December 31, 2011, is:

Period costs are operating costs that are expensed in the period in which the goods are sold.