1.Prime cost consists of:
A: Direct materials + direct labor
2. An unfavorable variance means that actual costs were lower than the amount budgeted.
A; False
3. The master budget contains which of the following budgets?
A; Both operating and financial budgets
4. method to evaluate capital investments, the company determines the number of years it will take to recover the asset’s original
A:
5. Factory overhead includes expenses such as utilities, insurance,
A:
6. An increase in the variable cost per unit will increase the contribution margin ratio.
A: False
7. Which of the following costs are included in the variable costing income statement’s cost of goods sold?
A: Only variable manufacturing costs
8. Which of the following best describes the process costing production flow?
A: Continuous flow from department to department
9. The same predetermined factory overhead rate should be used across all departments in process costing.
A: False
10. Which of the following costs would be included in factory overhead in a manufacturing company?
A: Factory supervisor salaries
11. If 18,000 units were sold during the period at a selling price of $50 per unit, what would be the contribution margin with a $25 variable cost per unit
A:
12. The calculation used to determine the breakeven point in units is:
A: Total fixed costs divided by unit contribution margin
13. A company is considering the purchase of equipment that costs $120,000 and has an estimated residual value
A:
14. Job 12345 has $5,000 of materials, $4,000 of labor, and $1,100 of overhead added to Work in Process
A:
15. Under absorption costing, when are fixed factory overhead costs expensed on the income statement?
A: When the product is sold
16. Calculate the direct materials quantity variance if actual quantity used is 8,800 pounds and the standard quantity is 8,600 pounds. The standard price is $6 per pound.
A: $1,200 unfavorable
17. All of the following are considered the three costs of production that accumulate in the Work in Process, except:
A: cost of goods sold
18. In process costing, costs flow from one department to the next through debits and credits to the
A:
19. The contribution margin ratio measures the
A:
20. If total actual factory overhead costs are $575,000 and total actual machine hours are 25,000, what was the factory overhead rate per machine hour?
A:
21. If fixed costs are $100,000, the selling price per unit is $50, and the variable cost per unit is $20, what is the monthly breakeven point in units?
A; 3,333 units
22. expenses include expenditures for a company’s accounting department and human resources department.
A:
23. costs are expenditures that can be specifically traced to a manufactured product.
A: Direct
24. In process costing,
A:
25. Which of the following is NOT a product cost?
A: selling expenses
26. RentGo Company has fixed costs of $75,000 per month. Each rental unit sells for $125 per day. The variable cost per rental unit is $25 per day. If next month’s sales volume is budgeted at 450 rental units, what is the expected operating income?
A: $30,000
27. True or False: Finished goods is the account in which the costs of a manufactured product accumulate.
A: False
28. Which account is debited to record the cost of materials being moved from the storeroom to the factory?
A: Work in Process
29. What are the two key components needed to prepare a sales budget?
A: Number of units sold and unit selling price
30. involves work done directly by factory workers on products sold to customers.
A:
