Accounting Test with Multiple Choice Questions Essay

1891 Words Nov 7th, 2013 8 Pages
BA 213 - Test#1 Review Instructor: Usha Ramanujam Dear Students,
I have indicated answers to the test review questions in BOLD. You can highlight the entire review and remove the bold feature before you start working on these questions and then verify the answers. Also, detailed solutions are given for q.38 and q.40 /Usha
1. Thread used in the production of mattresses, an indirect material, is classified as manufacturing overhead. TRUE/ False

2. Prime cost and conversion cost share what common element of total cost? A) Direct materials. B) Direct labor. C) Variable overhead. D) Fixed overhead.

3. Wages paid to a timekeeper in a factory are a:

Prime cost
Conversion cost
A)
Yes
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The cost of goods sold for the year (in thousands of dollars) was: A) $490 B) $450 C) $620 D) $600

14. The net operating income for the year (in thousands of dollars) was: A) $170 B) $140 C) $500 D) $200

15. Emco Company uses direct labor cost as a basis for computing its predetermined overhead rate. In computing the predetermined overhead rate for last year, the company misclassified a portion of direct labor cost as indirect labor. The effect of this misclassification will be to: A) understate the predetermined overhead rate. B) overstate the predetermined overhead rate. C) have no effect on the predetermined overhead rate. D) cannot be determined from the information given.

16. The journal entry to record applying overhead during the production process is: A)
Manufacturing Overhead
XXX

Work In Process

XXX
B)
Finished Goods
XXX

Manufacturing Overhead

XXX
C)
Manufacturing Overhead
XXX

Finished Goods

XXX
D)
Work In Process
XXX

Manufacturing Overhead

XXX

17. On the Schedule of Cost of Goods Manufactured, the final Cost of Goods Manufactured figure represents: A) the amount of cost charged to Work in Process during the period. B) the amount of cost transferred from Finished Goods to Cost of Goods Sold during the period. C) the amount of cost placed into production during

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