Term
Value chain analysis takes place:
a) In order to implement a firm’s competitive strategy
b) In order to create/design a firm’s competitive strategry
c) In order to price the firm’s product at the lowest price in the industry
d) In order to establish the highest product quality standards in the industry |
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Definition
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Term
An accounting report that derives the increase in a manufacturing firm’s finished goods inventory
a) Balance sheet
b) Cash flow budget
c) Balanced scorecard
d) Statement of cost of goods manufactured |
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Definition
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Term
Two contemporary (recent years) business environment factors vs. prior (5-10 years ago) business environment factors include:
a) short product life cycles and global markets
b) long product life cycles and domestic markets
c) machine paced and low level skills
d) economies of scale and standardization |
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Definition
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Term
for a manufacuring firm, the accounting transaction that recognizes an increase in the finished goods inventory:
a) Includes a credit to Finished Goods Inv. and a debit to WIP Inventory
b) Includes a debit to Finished Goods Inv. and a credit to COGM
c) Includes a debit to Finished Goods Inv. and a credit to WIP Inventory
d) Includes a credit to Finished Goods Inv. and a debit |
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Definition
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Term
The concept and practice of lean manufacturing:
a) is gaining popularity within the manufacturing environment
b) was popular in the 1980's but is now being replaced by the concept of long production runs
c) is being replaced by the machine paced-low level skills method of production
d) Is being replaced by the hierarchical/ command and control system |
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Definition
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Term
SWOT analysis focuses upon:
a) pricing a firms primary product line
b) establishing the industry's highest quality standards
c) Identifying a firm's critical success factors
d) maximizing current performance period financial profits |
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Definition
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Term
A merchandising firm will generally have ________ inventory account(s) in its general ledger
a) one
b) two
c) three
d) four |
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Definition
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Term
Referancing the diagram that was used in class to illustrate the movement of costs in a manufacturing for a given accounting period, the transfer of costs from WIP to FG is equal to ________ for the accounting period.
a) Total Manufacturing Costs
b) COGS
c) COGM
d) None of the above |
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Definition
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Term
Assuming that a firm with a mix of fixed and variable costs is operating within its relevant range, as the activity level of units manufactured decreases the average cost per unit manufactured will:
a) increase
b) decrease
c) remain the same
d) depends upon which cost type has the greatest dollar value |
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Definition
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Term
Manufacturing overhead used in production is an example of:
a) a product cost
b) an inventoriable cost
c) a conversion cost
d) all of the above |
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Definition
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Term
At the beginning of the year the FG inventory for MSM Co. was $20,000, COGS for the year was $180,000, and the ending FG inventory was $30,000. COGM for the year was:
a) $200,000
b) $210,000
c) $170,000
d) $190,000 |
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Definition
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Term
Assuming that a firm is operating within its relevant range, as production increases the variable cost per unit will
a) increase
b) decrease
c) remain the same |
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Definition
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Term
Which of the following would not likely be classified as a product cost:
a) indirect manufacturing labor
b) repair and mainenance cost on factory machines
c) social security tax expense applicable to direct labor
d) all of the above would likely be considered product costs |
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Definition
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Term
The predetermined O/H rate is calculated as:
a) budgeted DL divided by budgeted DLH
b) budgeted total manufacturing costs divided by a budgeted activity base
c) budgeted O/H divided by a budgeted activity base
d) actual O/H divided by a budgeted activity base |
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Definition
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Term
The journal entry to allocate O/H includes:
a) DR to WIP and CR to O/H
b) CR to WIP and DR to O/H
c) DR to WIP and CR to materials, labor, and O/H
d) CR to WIP and DR to materials, labor, and O/H |
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Definition
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Term
Assuming that all other factors are just as forecasted, if actual O/H is less than budgeted O/H, O/H will be:
a) overapplied
b) underapplied
c) neither over or under applied
d) more information is needed |
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Definition
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Term
If O/H is overapplied but the amount is immaterial, the adjustment will result in:
a) higher net income for the period
b) lower net income for the period
c) non change in net income for the period
d) depends on the dollar amount |
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Definition
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Term
The journal entry to move the cost accumulated on a job that was just completed includes:
a) DR to WIP and CR to FG
b) CR to FG and DR to WIP
c) DR to FG and CR to WIP
d) DR to COGS and CR to FG |
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Definition
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Term
The schedule of COGM is designed to determine the amount that results in a DR to
a) WIP
b) FG
c) COGS
d) None of the above |
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Definition
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Term
Using Activity Based Costing generally results in the development of
a) fewer - more efficient O/H pools
b) a greater dollar amount of O/H for the firm
c) a greater number of O/H pools
d) a more precise, single, predetermined O/H rate |
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Definition
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Term
The step method to O/H cost allocation is generally considered reasonable because
a) the time gained in calculating the O/H application is reduced and made more efficient
b) the resulting O/H allocation reduces the amount of total O/H applied
c) the resulting O/H allocation provides a more precise cost allocation of end units
d) the resulting total manufacturing cost is reduced and profitability is enhanced |
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Definition
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Term
ABC company's production manager just requisitioned 100 pounds of raw material "z" from the warehouse. The cost is $18 per pound. This transaction
a) increases COGS by $1,800
b) increases net income by $1,800
c) decreases net income by $1,800
d) increases total assets by $1,800
e) none of the above |
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Definition
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Term
SHI company forecasted total O/H to be $2,000,000 and forecasted the cost driver (machine hours) to be 100,000 hours. The actual O/H was $1,860,000 and the actual machine hours was 9,200. All required adjusting entries were made to zero out the O/H account and properly update all affected account balances. The result of these adjusting entries was to
a) increase net income for the year
b) decrease net income for the year
c) had no effect on net income for the year |
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Definition
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Term
RST company uses a job costing system that applies O/H on the basis of DL dollars. During the month of March the company worked on job C89. Total O/H applied was $60,000. Total DL dollars were $90,000. The firms predetermined O/H rate is
a) 150% of DL dollars
b) 67% of DL dollars
c) some other value
d) need more information to calculate |
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Definition
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Term
The three types of manufacturing costs include
a) raw materials, WIP, and FG
b) direct costs, indirect costs, and O/H
c) WIP, FG, and COGS
d) materials, labor, O/H |
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Definition
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Term
During the year a firm's COGS was $180,000. The ending FG inventory was $40,000. COGM was $200,000. FG beginning inventory was
a) $140,000
b) $160,000
c) $20,000
d) some other amount |
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Definition
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Term
When the budgeting process begins the usual starting point is to forecast:
A. direct labor costs
B. Applicable cost drivers
C. sales
D. units to be produced |
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Definition
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Term
the frst step in the cost estimation process is normally to
A. Identify cost objects
B. collect data
C. identify cost drivers
D. select the estimation method |
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Definition
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Term
ABC company is developing a formula to forecast vehicle operating cost. Miles driven is determined to be the most applicable cost driver.
A. vehicle operating cost is the independent variable and miles drven s the dependent variable
B. miles driven is the independent variable and vehicle operating cost is the dependent variable
C. each are dependent variable
D. each are independent variable |
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Definition
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Term
when using regression analysis for cost estmation the evaluator seeks a
A. high R squared value
B. low R squared value
C. positive R squared value
D. R squared value between .25 and .75 |
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Definition
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Term
The formula for the contribution margin ratio is
a. variable cost plus fixed costs
b. sales minus variable costs
c. sales munus fixed costs
d. sales minus variable costs divided by sales |
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Definition
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Term
Continuous improvement in the budgeting process is normally associated with
a. Kaizen budgeting
b. goal congruence budgeting
c. zero based budgeting
d. activity based budgeting |
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Definition
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Term
Budgetary slack often has the impact of forecasting
a. lover than estimated net income
b. higher than best estimated income
c. no material difference in estimated net income |
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Definition
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Term
ABC Co. forecasts that 600 units of product will be sold in 2012. the firm ended 2011 with 40 unts in inventory and expects to end 2012 with 70 units in inventory. During 2012 ABC needs to acquire _____ units of inventory
a. 670
b. 570
c. 530
d. 630 |
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Definition
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Term
The line with the steepest slope on a breakeven chart is the ______ line
a. fixed cost
b. variable cost
c. total cost
d. sales |
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Definition
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Term
Assume that a profitable firm has been notified that all costs for the comng year will increase by 8%. The good news is that the firm can increase its prices by 8%. The impact of these changes will be to
a. lower the breakeven point
b. increase the breakeven point in sales dollars
c. have no impact on the breakeven point in sales dollars |
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Definition
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Term
ABC company currently has monthly fixed costs of 20,000 variable cos per unit of 10$ and a selling price of 15$ per unit. The firm is considering increasing monthly fixed cost by 3000$ and lowering variable cost per unit by $3. The impact of these changes will be to
a. increase the unit breakeven point
b. decrease the unit breakeven point
c. have no impact on the unit breakeven point |
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Definition
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Term
A contribution type income statement groups costs by
a. function
b. operating department
c. manufacturing/overhead/administration
d. behavior |
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Definition
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Term
outliers are best observed using the
a. least squares method
b. regression analysis method
c. high/low method
d. scatter graph method |
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Definition
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Term
relevant cost analysis
a. has a short term focus
b. has a customer focus
c. has a long term focus
d. has a focus on fixed sunk costs |
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Definition
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Term
Assume that the purchase price for a part is $35. It can be manufactured for 33$. The $33 manufacturing costs include $5 per unt of fixed cost that will continue to be incurred whether the item is purchased or manufactured.
a. The cost benefit of manufacturing is $2 per unit
b. the cost benefit of manufacturing is $5 per unit
c. the cost benefit of manufacturing is $7
d. there is no cost benefit |
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Definition
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Term
A sunk cost is generally considered to be
a. a relevant cost
b. not a relevant cost
c. an incremental cost
d. a variable cost |
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Definition
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Term
In a capital budgeting model the after tax benefit of cash cost savings is equal to
a. the pretax cost savings times the firm's tax rate
b. the pre tax cost savings times 1 plus the tax rate
c. the pretax cost savings times 1 minus the tax rate
d. none of the above |
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Definition
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Term
the present value of a three year 100$ annuity is
a. greater than the present value of 100$ received at the end of year 3
b. greater than the present value of 100$ received at the end of year 1
c. both of the above
d. neither of the above |
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Definition
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Term
The IRR is
a. the discount rate that causes the present value of cash inflows to equal zero
b. the discount rate that causes the present value of cash outflows to equal zero
c. the discount rate that causes the net present value of cash flows to equal zero
d. none of the above |
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Definition
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Term
as the discount rate increases, the present value of an annuity and a single sum will
a. increase and increase
b. decrease adn decrease
c. increase and decrease
d. decrease and increase |
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Definition
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Term
capital budgeting focuses primarily on
a. pretax net income
b. the firms after tax cost of debt
c. the firms dividend yield
d. the firms risk adjusted weighted average cost of captal |
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Definition
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Term
| When a projects hurdle rate is increased, the net present value of he project will be increased when capital budgeting analysis is applied |
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Definition
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Term
| When a project's tax rate is increased the net present value of the project is increased |
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Definition
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Term
| The use of accelerated depreciation will increase the NPV of a capital budgeting related project |
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Definition
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Term
| Fixed costs are never considered in a relevant cost decision analysis |
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Definition
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Term
| The payback method is generally considered to be a more comprehensive method of project analysis then the NPV or the IRR methods. |
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Definition
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