Quiz 1 study guide

Topics: Variable cost, Costs, Management accounting Pages: 16 (2095 words) Published: March 22, 2014
1.Which of the following persons would occupy a line position in a department store?
I. Sales manager
II. Manager, furniture department
III. Manager, advertising department
IV. Manager, personnel department
A)Only I
B)Only I and II
C)Only I, II, III
D)I, II, III, IV

2.The benefits of a successful Just-In-Time system include all of the following except:
A)funds tied up in inventories are released for use elsewhere.
B)inventory buffers are increased.
C)throughput time is reduced.
D)defect rates are decreased.

3.A successful JIT system is based upon which of the following concepts?
A)The company must rely upon a large number of suppliers to ensure frequent deliveries of small lots.
B)The company should always choose those suppliers offering the lowest prices.
C)The company should avoid long-term contracts with suppliers so as to exert pressure on suppliers to make prompt and frequent deliveries.
D)A small number of suppliers make frequent deliveries of specific quantities thus avoiding the buildup of large inventories of materials on hand.

4.Which of the following statements are true regarding financial and managerial accounting?
I. Both are mandatory.
II. Both rely on the same underlying financial data.
III. Both emphasize the segments of an organization, rather than just looking at the
organization as a whole.
IV. Both are geared to the future, rather than to the past.
A)I, II, III, and IV
B)Only II, III and IV
C)Only II and III
D)Only II

5.The cost of rent for a manufacturing plant is generally considered to be a:

Prime costProduct cost
A)NoYes
B)NoNo
C)YesNo
D)YesYes

6.The salary of the president of a manufacturing company would be classified as which of the following?
A)Product cost
B)Period cost
C)Manufacturing overhead
D)Direct labor

7.Variable cost:
A)increases on a per unit basis as the number of units produced increases.
B)remains constant on a per unit basis as the number of units produced increases.
C)remains the same in total as production increases.
D)decreases on a per unit basis as the number of units produced increases.

8.Within the relevant range, the difference between variable costs and fixed costs is:
A)variable costs per unit fluctuate and fixed costs per unit remain constant.
B)variable costs per unit are constant and fixed costs per unit fluctuate.
C)both total variable costs and total fixed costs are constant.
D)both total variable costs and total fixed costs fluctuate.

9.If the cost of goods sold is greater than the cost of goods manufactured, then:
A)work in process inventory has decreased during the period.
B)finished goods inventory has increased during the period.
C)total manufacturing costs must be greater than cost of goods manufactured.
D)finished goods inventory has decreased during the period.

10.Delta Merchandising, Inc., has provided the following information for the year just ended:

Net sales $128,500
Beginning inventory 24,000
Purchases 80,000
Gross margin 38,550

The ending inventory for the company at year end was:
A)$65,450.
B)$24,500.
C)$14,050.
D)$9,950.

11.The beginning balance of the Raw Materials inventory account for May was $27,500. The ending balance for May was $28,750 and $128,900 of raw materials were used during the month. The materials purchased during the month cost:

A)$131,300.
B)$127,650.
C)$130,150.
D)$157,650.

12.Gabel Inc. is a merchandising company. Last month the company's merchandise purchases totaled $63,000. The company's beginning merchandise inventory was $13,000 and its ending merchandise inventory was $15,000. What was the company's cost of goods sold for the month?

A)$91,000
B)...
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