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Exam 14: Managerial Accounting Concepts and Principles

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Question 91

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Assume Back to the Roots used 1 million pounds of raw materials in their most recent accounting year.They started the year with 20,000 pounds of raw materials and ended with 40,000 pounds. (a) Compute Back to the Roots' raw materials inventory turnover. (b) Compute Back to the Roots' days' sales in raw materials inventory. (c) Interpret these results.What can the company do to improve these measures?

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(a)Raw materials inventory turnover:
1,0...

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Question 92

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Selling and administrative expenses are normally product costs.

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Question 93

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Use the following data to determine the cost of goods manufactured: $\begin{array}{lr}\text { Beginning finished goods inventory } & \$ 10,800 \\\text { Direct labor } & 30,600 \\\text { Beginning goods in process inventory } & 7,200 \\\text { General and administrative expenses } & 13,500 \\\text { Direct materials used } & 40,500 \\\text { Ending goods in process inventory } & 9,000 \\\text { Indirect labor } & 6,300 \\\text { Ending finished goods inventory } & 9,500 \\\text { Indirect materials } & 13,500 \\\text { Depreciation - factory equipment } & 7,500\end{array}$

The manufacturing statement is also known as ____________________________.

A management concept that encourages all managers and employees to be in tune with the wants and needs of customers,and which leads to flexible product designs and production processes,is called:

The ________________________ aids continuous improvement by augmenting financial measures with information on the drivers or indicators of future financial performance along four dimensions: (1)financial,(2)customer,(3)internal business processes,and (4)learning and growth.

Whitman Products and Rockland Industries report the following information at December 31: $\begin{array}{lrr}&\text { WHIIMAN }&\text { ROCKLAND }\\ \text { Accounts receivable } & \$ 41,000 & \$ 68,000 \\\text { Cash } & 6,000 & 7,000 \\\text { Finished goods inventory } & & 25,000 \\\text { Goods in process inventory } & & 40,000 \\\text { Merchandise inventory } & 48,000 \\ \text { Prepaid expenses } & 1,000 & 2,000 \\\text { Raw materials inventory } & & 21,000\end{array}$ Required: (a) Which company is a manufacturer? Explain. (b) Prepare the current asset section of the balance sheet for the manufacturer.

Ending raw materials inventory divided by raw materials used multiplied by 365 is the _________________________.

A manufacturing statement is also known as a schedule or listing of the:

Define and contrast period costs and product costs.How are they reported in the financial statements of a manufacturing company?

What are raw materials inventory turnover and days' sales in raw materials inventory? What is the purpose of these measures?

Which of the following items appears only in a manufacturing company's financial statements?

The manufacturing statement must be prepared monthly as it is a required general-purpose financial statement.

A _________________ cost does not change in proportion to changes in the volume of activity within the relevant range.

The manufacturing statement is also known as the schedule of manufacturing activities or the schedule of cost of goods manufactured.

A company reports raw materials used of $42,750 for a year,with beginning raw materials inventory of $4,000 and an ending raw materials inventory of $4,500.Compute days' sales in raw materials inventory based on this data.

A manufacturing firm's cost of goods manufactured is equivalent to a merchandising firm's:

Period costs for a manufacturing company would flow directly to:

Figure 14_03 Use the following information for Acme, Inc., as of December 31 $\begin{array} { l r } \text { Administrative salaries } & \$ 32,000 \\\text { Depreciation of factory equipment } & 25,000 \\\text { Depreciation of delivery vehicles } & 9,000 \\\text { Direct labor } & 68,000 \\\text { Factory supplies used } & 12,000 \\\text { Finished goods inventory, January 1 } & 57,000 \\\text { Finished goods inventory, December } 31 & 68,000 \\\text { Factory insurance } & 15,500 \\\text { Interest expense } & 12,000 \\\text { Factory utilities } & 14,000 \\\text { Factory maintenance } & 7,500 \\\text { Raw materials inventory, January 1 } & 8,000 \\\text { Raw materials inventory, December 31 } & 4,000 \\\text { Raw material purchases } & 125,000 \\\text { Rent on factory building } & 25,000 \\\text { Repairs of factory equipment } & 11,500 \\\text { Sales commissions } & 37,500 \\\text { Goods in process inventory, January } 1 & 3,500 \\\text { Goods in process inventory, December } 31 & 2,000\end{array}$ -What is the correct amount of overhead?

Classifying costs by behavior involves: