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Exam 2: Managerial Accounting and Cost Concepts

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Question 1

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Gluth Corporation has provided the following data for the month of July. The beginning balance in the finished goods inventory account was $56,000 and the ending balance was $49,000. Sales totaled $290,000. Cost of goods manufactured was $147,000, selling expense was $17,000, and administrative expense was $68,000. -The net operating income for July was:

A) $58,000
B) $143,000
C) $150,000
D) $51,000

E) C) and D)
F) A) and C)

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Question 2

Multiple Choice

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Using the following data for August, calculate the cost of goods manufactured: The cost of goods manufactured was:

A) $106,000
B) $92,000
C) $95,000
D) $89,000

E) B) and C)
F) All of the above

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D

Question 3

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Managerial accounting is primarily concerned with the organization as a whole rather than with segments of the organization.

Geneva Steel Corporation produces large sheets of heavy gauge steel. The company showed the following amounts relating to its production for the year just completed: -The balance of the finished goods inventory at the end of the year was:

In a manufacturing firm, all costs are product costs.

During the month of January, Fisher Corporation, a manufacturing company, purchased raw materials costing $76,000. The cost of goods manufactured for the month was $129,000. The beginning balance in the raw materials account was $26,000 and the ending balance was $21,000. The beginning balance in the finished goods account was $52,000 and the ending balance was $35,000. Required: a. What was the cost of raw materials used in production during January? Show your work. b. What was the cost of goods sold for January? Show your work.

The following cost data pertain to the operations of Lefthand Department Stores, Inc., for the month of December. The Brentwood Store is just one of many stores owned and operated by the company. The Shoe Department is one of many departments at the Brentwood Store. The central warehouse serves all of the company's stores. -What is the total amount of the costs listed above that are direct costs of the Shoe Department?

Which of the following IS a characteristic of financial accounting?

If the finished goods inventory increases between the beginning and the end of a period, then the cost of goods manufactured for the period is larger than the cost of goods sold.

The variable cost per unit is constant and does not depend on how many units are produced.

The following data (in thousands of dollars) have been taken from the accounting records of Karlana Corporation for the just completed year. -The net operating income for the year (in thousands of dollars) was:

Buford Company rents out a small unused portion of its factory to another company for $1,000 per month. The rental agreement will expire next month, and rather than renew the agreement Buford Company is thinking about using the space itself to store materials. The term to describe the $1,000 per month is:

Tator Corporation reported the following data for the month of April: -The net operating income for April was:

A number of costs and measures of activity are listed below. Required: For each item above, indicate whether the cost is MAINLY fixed or variable with respect to the possible measure of activity listed next to it.

A partial listing of costs incurred during February at Urfer Corporation appears below: -The total of the period costs listed above for February is:

A partial listing of costs incurred during February at Urfer Corporation appears below: -The total of the product costs listed above for February is:

At a sales volume of 36,000 units, Quale Corporation's sales commissions (a cost that is variable with respect to sales volume) total $187,200. -To the nearest whole dollar, what should be the total sales commissions at a sales volume of 38,300 units? (Assume that this sales volume is within the relevant range.)

An opportunity cost is:

Gabrisch Inc. is a merchandising company. Last month the company's merchandise purchases totaled $90,000. The company's beginning merchandise inventory was $13,000 and its ending merchandise inventory was $22,000. What was the company's cost of goods sold for the month?

The CFO of Stoffer Corporation has provided the following data for October. The beginning balance in the raw materials inventory account was $39,000. During the month, the company made raw materials purchases amounting to $68,000. At the end of the month, the balance in the raw materials inventory account was $28,000. Direct labor cost was $29,000 and manufacturing overhead was $78,000. The beginning balance in the work in process account was $11,000 and the ending balance was $13,000. The beginning balance in the finished goods account was $37,000 and the ending balance was $47,000. Sales totaled $240,000. Selling expense was $21,000 and administrative expense was $27,000. -The cost of goods sold for October was: