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Exam 2: Managerial Accounting and Cost Concepts

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Question 41

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Management of Berndt Corporation has asked your help as an intern in preparing some key reports for August.The beginning balance in the raw materials inventory account was $33,000.During the month,the company made raw materials purchases amounting to $62,000.At the end of the month,the balance in the raw materials inventory account was $30,000.Direct labor cost was $46,000 and manufacturing overhead was $74,000.The beginning balance in the work in process account was $13,000 and the ending balance was $19,000.The beginning balance in the finished goods account was $54,000 and the ending balance was $50,000.Sales totaled $270,000.Selling expense was $18,000 and administrative expense was $49,000. -The net operating income for August was:

A) $20,000
B) $21,000
C) $87,000
D) $83,000

E) A) and B)
F) A) and D)

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Question 42

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A partial listing of costs incurred at Rust Corporation during August appears below: Required: a.What is the total amount of product cost listed above? Show your work. b.What is the total amount of period cost listed above? Show your work.

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Question 43

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Consider the following costs incurred in a recent period: What was the total amount of the period costs listed above for the period?

Cromuel Corporation has provided the following data for January.The beginning balance in the raw materials inventory account was $27,000.During the month,the company made raw materials purchases amounting to $50,000.At the end of the month,the balance in the raw materials inventory account was $24,000.Direct labor cost was $53,000 and manufacturing overhead was $70,000.The beginning balance in the work in process account was $14,000 and the ending balance was $12,000.The beginning balance in the finished goods account was $33,000 and the ending balance was $51,000.Sales totaled $270,000.Selling expense was $21,000 and administrative expense was $48,000. -The net operating income for January was:

Dagg Corporation reported the following data for the month of October: -The total manufacturing cost for October was:

Corcetti Company manufactures and sells prewashed denim jeans.Large rolls of denim cloth are purchased and are first washed in a giant washing machine.After the cloth is dried,it is cut up into jean pattern shapes and then sewn together.The completed jeans are sold to various retail chains. -Which of the following terms could be used to correctly describe the cost of the soap used to wash the denim cloth?

Dodridge Corporation has provided the following data for February.The beginning balance in the raw materials inventory account was $23,000.During the month,the company made raw materials purchases amounting to $59,000.At the end of the month,the balance in the raw materials inventory account was $33,000.Direct labor cost was $28,000 and manufacturing overhead was $74,000.The beginning balance in the work in process account was $12,000 and the ending balance was $17,000.The beginning balance in the finished goods account was $48,000 and the ending balance was $54,000. -The total manufacturing cost for February was:

How much opportunity cost is represented in the following information concerning a machine?

The following inventory balances relate to Lequin Manufacturing Corporation at the beginning and end of the year: Lequin's total manufacturing cost was $543,000.What was Lequin's cost of goods sold?

The CFO of Stoffer Corporation has provided the following data for October.The beginning balance in the raw materials inventory account was $39,000.During the month,the company made raw materials purchases amounting to $68,000.At the end of the month,the balance in the raw materials inventory account was $28,000.Direct labor cost was $29,000 and manufacturing overhead was $78,000.The beginning balance in the work in process account was $11,000 and the ending balance was $13,000.The beginning balance in the finished goods account was $37,000 and the ending balance was $47,000.Sales totaled $240,000.Selling expense was $21,000 and administrative expense was $27,000. -The cost of goods sold for October was:

Derflinger Corporation reported the following data for the month of January: -The cost of goods manufactured for January was:

The following cost data pertain to the operations of Lefthand Department Stores,Inc. ,for the month of December. The Brentwood Store is just one of many stores owned and operated by the company.The Shoe Department is one of many departments at the Brentwood Store.The central warehouse serves all of the company's stores. -What is the total amount of the costs listed above that are NOT direct costs of the Brentwood Store?

Williams Company's direct labor cost is 25% of its conversion cost.If the manufacturing overhead for the last period was $45,000 and the direct materials cost was $25,000,the direct labor cost was:

Cromuel Corporation has provided the following data for January.The beginning balance in the raw materials inventory account was $27,000.During the month,the company made raw materials purchases amounting to $50,000.At the end of the month,the balance in the raw materials inventory account was $24,000.Direct labor cost was $53,000 and manufacturing overhead was $70,000.The beginning balance in the work in process account was $14,000 and the ending balance was $12,000.The beginning balance in the finished goods account was $33,000 and the ending balance was $51,000.Sales totaled $270,000.Selling expense was $21,000 and administrative expense was $48,000. -The total manufacturing cost for January was:

Management of Sourwine Corporation is considering whether to purchase a new model 320 machine costing $389,000 or a new model 280 machine costing $318,000 to replace a machine that was purchased 6 years ago for $376,000.The old machine was used to make product C78P until it broke down last week.Unfortunately,the old machine cannot be repaired. Management has decided to buy the new model 280 machine.It has less capacity than the new model 320 machine,but its capacity is sufficient to continue making product C78P. Management also considered,but rejected,the alternative of simply dropping product C78P.If that were done,instead of investing $318,000 in the new machine,the money could be invested in a project that would return a total of $405,000. -In making the decision to buy the model 280 machine rather than the model 320 machine,the differential cost was:

Within the relevant range,the difference between variable costs and fixed costs is:

A number of costs are listed below. Required: For each item above,indicate whether the cost is direct or indirect with respect to the cost object listed next to it.

A fixed cost is constant per unit of product.

Weygandt Corporation reported the following data for the month of February: -The total manufacturing cost for February was:

Nadell Corporation reported the following data for the month of April: -If the company transferred $234,000 of completed goods from work in process to finished goods inventory during April,what was the cost of goods sold for the month?