CHAPTER 18 QUIZ
1 Period costs can be found on both the balance sheet and the income statement.
False
2 Use the information below for Darwin Company to answer the question that
follow.
Sales $76,500
Direct materials used 7,300
Depreciation on factory equipment 4,700
Indirect labor 5,900
Direct labor 10,500
Factory rent 4,200
Factory utilities 1,200
Sales salaries expense 15,600
Office salaries expense 8,900
m
er as
Indirect materials 1,200
co
eH w
Darwin Company's product costs are - $35,000
o.
Product Costs = Direct Materials Cost + Direct Labor Cost + Factory Overhead Cost a = $7,300 +
rs e
$10,500 + $4,700 + $5,900 + $4,200 + $1,200 + $1,200 = $35,000
ou urc
a
Factory Overhead Costs = Depreciation on factory equipment + Indirect labor + Factory rent +
Factory utilities + Indirect materials
o
aC s
3 Costs other than direct materials cost and direct labor cost incurred in the
vi y re
manufacturing process are classified as factory overhead cost.
True
4 Managerial accounting reports must be prepared according to generally
ed d
accepted accounting principles
ar stu
False
5 A company manufactured 50,000 units of a product at a cost of $450,000. It
is
sold 45,000 units at $15 each. The gross profit is
$270,000
Th
Cost of Manufacturing 45,000 units = ($450,000/50,000 units) × 45,000 = $405,000
Gross Profit = Sales – Cost of Manufacturing = ($15 × 45,000) – $405,000 = $675,000 – $405,000 =
sh
$270,000
6 Use
This thewasinformation
study source below for
downloaded by 100000790585579 Darwin Company
from [Link] to answer
on 05-21-2021 [Link] GMT -05:00the question that follow.
[Link]
Sales $76,500
Direct materials used 7,300
Depreciation on factory equipment 4,700
Indirect labor 5,900
Direct labor 10,500
Factory rent 4,200
Factory utilities 1,200
Sales salaries expense 15,600
Office salaries expense 8,900
Indirect materials 1,200
Darwin Company's period costs are
d.$24,500
Period Costs = Sales Salaries Expense + Office Salaries Expense = $15,600 + $8,900 = $24,500
7 Product costs include direct labor and advertising expense.
m
er as
False
co
eH w
8 Work in process inventory increased by $20,000 during the current year. Cost of
o.
goods manufactured was $180,000. Total manufacturing costs incurred are.
$200,000 rs e
ou urc
Total Manufacturing Costs = Cost of Goods Manufactured – Beginning Work in Process Inventory +
Ending Work in Process Inventory = $180,000 – Beginning Work in Process Inventory +
(Beginning Work in Process Inventory + $20,000) = $200,000
o
aC s
9 Finished goods inventory is reported on the balance sheet as a current asset
vi y re
10 A company used $35,000 of direct materials, incurred $73,000 in direct labor
ed d
cost, and had $114,000 in factory overhead costs during the period. If beginning
ar stu
and ending work in process inventories were $28,000 and $32,000, respectively,
the cost of goods manufactured was
d.$218,000
is
Cost of Goods Manufactured = Beginning Work in Process Inventories + Direct Materials + Direct
Th
Labor Cost + Factory Overhead Costs – Ending Work in Process Inventories = $28,000 + $35,000
+ $73,000 + $114,000 – $32,000 = $218,000
sh
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