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    4.1 Tutorial Questions 1

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    Lee Xing
    This document contains tutorial questions from Chapter 1 on managerial accounting concepts and principles. There are three sections - true/false questions, multiple choice questions, and exercises. The true/false questions cover topics like the definitions of managerial and financial accounting, characteristics of costs, and inventory classifications. The multiple choice questions test understanding of concepts like identifying direct costs, classifying costs by behavior, and calculating cost of goods sold. The exercises involve identifying sources of accounting information and classifying costs.

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    4.1 Tutorial Questions 1

    Uploaded by

    Lee Xing
    685 views6 pages
    This document contains tutorial questions from Chapter 1 on managerial accounting concepts and principles. There are three sections - true/false questions, multiple choice questions, and exercises. The true/false questions cover topics like the definitions of managerial and financial accounting, characteristics of costs, and inventory classifications. The multiple choice questions test understanding of concepts like identifying direct costs, classifying costs by behavior, and calculating cost of goods sold. The exercises involve identifying sources of accounting information and classifying costs.

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    This document contains tutorial questions from Chapter 1 on managerial accounting concepts and principles. There are three sections - true/false questions, multiple choice questions, and exercises. The true/false questions cover topics like the definitions of managerial and financial accounting, characteristics of costs, and inventory classifications. The multiple choice questions test understanding of concepts like identifying direct costs, classifying costs by behavior, and calculating cost of goods sold. The exercises involve identifying sources of accounting information and classifying costs.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    685 views6 pages

    4.1 Tutorial Questions 1

    Uploaded by

    Lee Xing
    This document contains tutorial questions from Chapter 1 on managerial accounting concepts and principles. There are three sections - true/false questions, multiple choice questions, and exercises. The true/false questions cover topics like the definitions of managerial and financial accounting, characteristics of costs, and inventory classifications. The multiple choice questions test understanding of concepts like identifying direct costs, classifying costs by behavior, and calculating cost of goods sold. The exercises involve identifying sources of accounting information and classifying costs.

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    Tutorial Questions- Acc 104

    Chapter I : Managerial Accounting Concept and Principle


    ssssssssss
    I- True( T) / False ( F) Questions

    1- Managerial accounting is an activity that helps managers determine costs of products and
    services, plan future activities, and compare actual to planned results. T
    2- Control is the process of setting goals and determining ways to achieve them. F
    3- Managerial accounting provides financial and nonfinancial information to an organization's
    managers and other internal decision makers. T
    4- Costs are important to managers because they impact both the financial position and
    profitability of a business. T
    5- Managerial accounting reports and information are used by external users and financial
    accounting by internal users. T
    6- Both financial and managerial accounting rely on accepted principles that are enforced
    through an extensive set of rules and guidelines. F
    7- Both financial and managerial accounting affect user’s decisions and actions. T
    8- Direct materials are not easily traced to a product. F
    9- Total variable costs change in proportion to changes in the volume of activity. T
    10- Variable costs per unit change in proportion to changes in the volume of activity. F
    11- Product costs can refer to expenditures necessary to finish products and to the
    administrative support during the time period. F
    12- Period costs can refer to expenditures necessary to finish products during the time period.
    F
    13- Product costs are capitalized as inventory on the balance sheet and period costs are
    expensed on the income statement. T
    14- Product costs can be classified as one of three types: direct materials, direct labor, or
    overhead. T
    15- Manufacturers usually have three inventories: raw materials, work in process, and
    finished goods. T

    II- Multiple Choice Questions

    16- Managerial accounting information:


    A. Is used mainly by external users.
    B. Involves gathering information about costs for planning and control decisions.
    C. Is generally the only accounting information available to managers.
    D. Can be used for control purposes but not for planning purposes.
    E. Has little to do with controlling costs.
    17- Managerial accounting is different from financial accounting in that:
    A. Managerial accounting is more focused on the organization as a whole and
    financial accounting is more focused on subdivisions of the organization.
    B. Managerial accounting never includes nonmonetary information.
    C. Managerial accounting includes many projections and estimates whereas
    financial accounting has a minimum of predictions.
    D. Managerial accounting is used extensively by investors, whereas financial
    accounting is used only by creditors.
    E. Managerial accounting is mainly used to set stock prices.
    18- A direct cost is a cost that is:
    A. Identifiable as controllable.
    B. Traceable to the company as a whole.
    C. Does not change with the volume of activity.
    D. Traceable to a single cost object.
    E. Traceable to multiple cost objects.
    19- Classifying costs by behavior with changes in volume of activity involves:
    A. Identifying fixed cost and variable cost.
    B. Identifying cost of goods sold and operating costs.
    C. Identifying costs as financial or managerial.
    D. Identifying costs in a physical manner.
    E. Identifying both quantitative and qualitative cost factors.
    20- A fixed cost:
    A. Requires the future outlay of cash and is relevant for future decision making.
    B. Does not change with changes in the volume of activity within the relevant range.
    C. Is directly traceable to a cost object.
    D. Changes with changes in the volume of activity within the relevant range.
    E. Is irrelevant for cost-volume-profit and short-term decision making.
    21- A manufacturing company has a beginning finished goods inventory of $14,600, raw
    material purchases of $18,000, cost of goods manufactured of $32,500, and an ending
    finished goods inventory of $17,800. The cost of goods sold for this company is:
    A.$21,200.
    B. $29,300.
    C. $32,500.
    D. $47,100.
    E. $27,600

    Feedback: Beginning Finished Goods + Cost of Goods Manufactured – Ending Finished Goods = Cost
    of Goods Sold; $14,600 + $32,500 – $17,800 = $29,300
    22- A manufacturing company has a beginning finished goods inventory of $28,300, cost of
    goods manufactured of $58,500, and an ending finished goods inventory of $27,600. The
    cost of goods sold for this company is:
    A.$114,400.
    B. $57,800.
    C. $2,600.
    D. $86,100.
    E. $59,200.

    Feedback: Beginning Finished Goods + Cost of Goods Manufactured – Ending Finished Goods = Cost of
    Goods Sold; $28,300 + $58,500 – $27,600 = $59,200

    23- Craigmont Company’s direct materials costs are $3,000,000, its direct labor costs total
    $7,000,000, and its factory overhead costs total $5,000,000. Its prime costs total:
    A. $10,000,000.
    B. $8,000,000.
    C. $12,000,000.
    D. $5,000,000.
    E. $15,000,000.
    Feedback: Prime Costs = Direct Materials + Direct Labor; $3,000,000 + $7,000,000 = $10,000,000.

    24- A schedule of cost of goods manufactured is also known as a:


    A. Raw materials processed schedule.
    B. Factory supplies used schedule.
    C. Manufacturing statement.
    D. Total finished goods statement.
    E. Cost of goods sold schedule.
    25- Which of the following costs would not be classified as factory overhead?
    A. Property taxes on maintenance machinery.
    B. Insurance on factory building.
    C. Wages of the factory janitor.
    D. Rubber for the soles of shoes produced.
    E. Small tools used in production.

    III- Excises
    QS 1-1 Identify whether each description most likely applies to managerial (M) or financial
    (F) accounting.
    M
    F
    F
    M
    F
    I
    D
    I
    I
    D

    QS 1-5 Identify each of the following costs as either direct materials (DM), direct labor (DL), or factory
    overhead (FO). The company manufactures tennis balls.
    DM
    — 1. Rubber used to form the cores
    FO
    — 2. Factory maintenance
    DL
    — 3. Wages paid to assembly workers
    FO
    — 4. Glue used in binding rubber cores to felt covers
    — 5. Depreciation—Factory equipment
    FO

    — 6. Cans to package the balls


    DM

    QS 1-6 Identify each of the following costs as either a product cost (PROD) or a period cost (PER).
    PROD PROD
    PROD PROD
    PROD PROD

    Exercise 1-1 Indicate in the following chart the most likely source of information for each
    business decision. Use M for managerial accounting information and F for financial
    accounting information.
    Exercise 1-2 Listed here are product costs for the production of soccer balls. Classify each cost
    (a) as either variable (V) or fixed (F) and (b) as either direct (D) or indirect (I). What
    patterns do you see regarding the relation between costs classified in these two ways?
    -,

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