Multiple choice questions on various concepts of cost accounting.
1. Given the following: Transfers In $30,000; Transfers Out: $36,000; Ending Inventory: $6,000. What was the beginning balance?
a.$12,000
b.$0
c.$10,000
d.$18,000
Use the following to answer questions 2 and 3: Mansfield Corporation estimates its manufacturing overhead costs to be $160,000 and its direct labor costs to be $320,000 for 2007. The actual manufacturing labor costs were $80,000 for job 1, $120,000 for job 2 and $160,000 for job 3 during 2007. Manufacturing overhead is applied to jobs on the basis of direct labor costs using a predetermined overhead rate. The actual manufacturing overhead cost for the year was $172,000.
2. The amount of overhead assigned to Job 3 during 2007 was:
a.$80,000
b.$320,000
c.$160,000
d.$71,110
3. The amount of the manufacturing overhead variance during 2007 was:
a.8,000 Overapplied
b.$12,000 Overapplied
c.$12,000 Underapplied
d.$8,000 Underapplied
4. Salaries of the human resource staff responsible for hiring production personnel at Dell Computer would be an example of:
a.Unit-level activity
b.Facility-level activity
c.Batch-level activity
d.Product-level activity
5. Setup labor costs required for setting up equipment for flexible production facilities for manufacturing would be an example of:
a.Unit-level activity
b.Batch-level activity
c.producer-level activity
d.customer-level activity
6. The design and manufacture of a bottle cap mold for Avon Products Company is an example of:
a.A facility-level resource or activity
b.A customer-level resource or activity
c.A batch-level resource or activity
d.A product-level resource or activity
7. Which of the following statements is true?
a.Approval is usually a value-added activity
b.Setup of machines for production is a value-added activity
c.Processing itself is a source of non-value-added activity in many manufacturing firms
d.It may not be possible to eliminate all non-value-added activities
8. Which of the following statements is True regarding activity-based-costing and profitability analysis?
a.Unit level costing measures the impacts of various products use of resources
b.Full costing measures the impacts of various products on spending for resources
c.Only unit level costing is useful for decision making about products and services
d.Companies with a complex array of products produced from common facilities tend to benefit more from ABC than companies with a single product
9. The Malcolm Baldrige Award:
a.Is awarded to companies around the world that excel in quality improvement
b.Is awarded to the company that does the best job of adhering to ISO 9000 standards
c.Recognizes U.S. firms with outstanding records of quality improvements and quality management
d.Is required to received ISO 9000 certification
10. Dunn Corporation finds that 60% of the time spent in its manufacturing process is on non-value added activities such as moving parts and inspection. Dunn needs to improve:
a.Its throughput
b.Its customer-response time
c.Its throughput time ratio
d.Its average cycle time