Managerial Accounting Essay

630 Words Feb 11th, 2013 3 Pages
Quiz Questions for Chapter 1

1. Waverly Company paid $5,000 cash for wages of production workers. This business event would: a. increase total assets and total equity. b. increase one asset account and decrease another asset account. c. decrease total assets and total equity. d. decrease one asset account and increase an equity account.

2. Warren Company makes candy. During the most recent accounting period, Warren paid $3,000 for raw materials, $4,000 for labor, and $2,000 for overhead costs that were incurred to make candy. Warren started and completed 10,000 units of candy, of which 7,000 were sold. Based on this information, Warren would recognize which of the following amounts of expense on the income
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zero. b. $3,000 c. $2,500 d. $2,000

6. Which of the following items is not a product cost? a. Cash paid for wages of production workers. b. Cash paid for salary of production supervisor. c. Cash paid for wages of a maintenance crew that cleans the manufacturing facility. d. All of the above are product costs.

7. Consolidated Company makes cardboard boxes. During the most recent accounting period Consolidated paid $60,000 for raw materials, $48,000 for labor, and $52,000 for overhead costs that were incurred to make boxes. Consolidated started and completed 400,000 boxes. Based on this information, what is the average manufacturing cost per box? a. $0.40 b. $0.56 c. $0.50 d. $0.27

8. Consolidated Company makes cardboard boxes. During the most recent accounting period Consolidated paid $60,000 for raw materials, $48,000 for labor, and $52,000 for overhead costs that were incurred to make boxes. Consolidated started and completed 400,000 boxes. Consolidated desires to earn a gross margin that is equal to 40% of product cost. Based on this information the selling price per box is: a. $0.40 b. $0.56 c. $0.50 d. $0.70

9. Which of the following is a characteristic of managerial accounting information? a. It is historically based. b. It involves continuous reporting. c.

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