Understanding Key Concepts in Managerial Accounting Grading Summary These are the automatically computed results of your exam. Grades for essay questions, and comments from your instructor, are in the "Details" section below. Date Taken: Time Spent: Points Received: 170 / 170 (100%) Question Type: # Of Questions: # Correct: Multiple Choice 25 25 Short 1 N/A Essay 2 N/A Grade Details - All Questions Page: 1 2 3 1. Question : (TCO 1) Which of the following is not a difference between financial accounting and managerial accounting? Student Answer: Financial accounting is primarily concerned with reporting the past, while managerial accounting is more concerned with the future. Managerial accounting uses more nonmonetary information than is used in financial accounting. Managerial accounting is primarily concerned with providing information for external users while financial accounting is concerned with internal users. Financial accounting must follow GAAP while managerial accounting is not required to follow GAAP. Instructor Explanation: Chapter 1, Page 7 Points Received: 4 of 4 Comments: 2. Question : TCO 1) Which of the following statements regarding fixed costs is true? Student Answer: When production increases, fixed cost per unit increases. When production decreases, total fixed costs decrease. When production increases, fixed cost per unit decreases. When production decreases, total fixed costs increase. Instructor Explanation: Chapter 1, Page 9 Points Received: 4 of 4 Comments: 3. Question : (TCO 1) You own a car and are trying to decide whether or not to trade it in and buy a new car. Which of the following costs is an opportunity cost in this situation? Student Answer: the trip to Cancun that you will not be able to take if you buy the car the cost of the car you are trading in the cost of your books for this term the cost of your car insurance last year Instructor Explanation: Chapter 1, Page 9 Points Received: 4 of 4 Comments: 4. Question : (TCO 1) Shula’s 347 Grill has budgeted the following costs for a month in which 1,600 steak dinners will be produced and sold: materials, $4,080; hourly labor (variable), $5,200; rent (fixed), $1,700; depreciation, $800; and other fixed costs, $600. Each steak dinner sells for $14.00 each. How much is the budgeted variable cost per unit? Student Answer: $5.80 $7.74 $6.68 $3.25 Instructor Explanation: Chapter 1, Page 8 ($4,080 + $5,200) / 1,600 = $5.80 Points Received: 4 of 4 Comments: 5. Question : (TCO 1) Which of the following is an example of a manufacturing overhead cost? Student Answer: security at the manufacturing plant fabric used to produce shirts cost of shipping product to customers the salary of the president of the company Instructor Explanation: Chapter 2, Page 37 Points Received: 4 of 4 Comments: 6. Question : (TCO 1) Product costs Student Answer: are also called manufacturing costs. are considered an asset until the finished goods are sold. become an expense when the goods are sold. All of the above answers are correct. Instructor Explanation: Chapter 2, Page 38 Points Received: 4 of 4 Comments: 7. Question : (TCO 1) At December 31, 2010, WDT Inc. has a balance in the Work in Process Inventory account of $62,000. At January 1, 2010, the balance was $55,000. Current manufacturing costs for the year are $292,000, and cost of goods sold is $284,000. How much is cost of goods manufactured? Student Answer: $292,000 $299,000 $277,000 $285,000 Instructor Explanation: Chapter 2, Page 43 $55,000 + $292,000 - $62,000 = $285,000 Points Received: 4 of 4 Comments: 8. Question : (TCO 2) BCS Company applies manufacturing overhead based on direct labor hours. Information concerning manufacturing overhead and labor for August follows: Estimated Actual Overhead cost $174,000 $171,000 Direct labor hours 5,800 5,900 Direct labor cost $87,000 $89,975 How much overhead should be applied in total during August? Student Answer: 177,000 179,950 171,100 168,200 Instructor Explanation: Chapter 2, Page 54 ($174,000 / 5,800) x 5,900 = 177,000 Points Received: 4 of 4 Comments: 9. Question : (TCO 2) Citrus Company incurred manufacturing overhead costs of $300,000. Total overhead applied to jobs was $306,000. What was the amount of overapplied or underapplied overhead? Student Answer: $7,000 overapplied $6,000 overapplied $6,000 underapplied $13,000 underapplied Instructor Explanation: Chapter 2, Page 55 $306,000 - $300,000 = $6,000 overapplied Points Received: 4 of 4