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Ethics in Business and Industry > Managerial Accounting Midterm 1-7 > Flashcards

Managerial Accounting Midterm 1-7 Flashcards

1
Q

What is a part of the controlling responsibility of management?

A

Evaluating operations by comparing actual results to budgeted results

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2
Q

How often should managerial accounting reports be prepared?

A

as needed

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3
Q

What responsibilities does a CFO have?

A

providing reports to creditors as required, managing corporate financing, managing the preparation of all corporate tax returns

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4
Q

What are the IMA’s ethical principles?

A

Honesty, Fairness, Objectivity, and Responsibility

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5
Q

What was not a result of the Sarbanes-Oxley Act?

A

The COO assumes financial statement responsibility

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6
Q

Testing ways to increase the strength of your product would be classified as which of the following?

A

research and development

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7
Q

What are period costs?

A

costs that are not generally tied to or related to the production of inventory; selling, general and administration expenses, marketing expenses, CEO salary and rent expense for office

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8
Q

COGS

A

starting inventory + purchases - ending inventory

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9
Q

Cost of Goods Manufactured

A

Beginning WIP + Total Manufacturing Cost - Ending WIP

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10
Q

Operating Expenses

A

Sales commissions, rent for office, utilities for office

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11
Q

Variable cost per unit

A

total variable cost/total units produced

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12
Q

Total variable cost

A

Units produced x variable cost per unit

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13
Q

Job Costing

A

More unique production ex: custom wood structures

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14
Q

Beginning Raw Materials Inventory Balance

A

Ending balance of raw materials inventory + material requisitions - material purchase

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15
Q

Overhead Rate

A

Manufacturing Overhead/Estimated direct labor cost = %

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16
Q

Allocated manufacturing overhead costs

A

overhead rate x actual direct labor cost

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17
Q

predetermined manufacturing overhead rate

A

estimated manufacturing rate/activity base (per direct labor hour)

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18
Q

direct materials charged to the job

A

direct labor= MOH costs/allocation rate; overhead + direct labor + direct material = total cost

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19
Q

Actual Gross Profit

A

allocated manufacturing overheads+actual manufacturing overheads = over applied manufacturing overheads;

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20
Q

Prime Costs

A

total direct costs of production; raw materials and labor

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21
Q

Determining if manufacturing overhead is over-allocated or under-allocated

A

Under-allocated=actual MOH > allocated MOH costs
Over-allocated=actual MOH < allocated MOH costs

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22
Q

MOH

A

depreciation on factory equipment, factory administration expenses, equipment maintenance, factory employee benefits, quality control/inspection, rent for facility or lease costs for equipment, utilities

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23
Q

How to calculate MOH allocation rate

A

total MOH/ total # of products sold or # of direct labor hours

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24
Q

Predetermined overhead rate

A

budgeted MOH/budgeted DL cost

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25
Q

Applied MOH

A

predetermined overhead rate x DL cost

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26
Q

Overapplied/Underapplied MOH

A

applied MOH - actual MOH

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27
Q

Do you debit to Finish Goods Inventory account when transferring sold goods?

A

Yes

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28
Q

Under a perpetual inventory system, the journal entry needed to record the sale of a job includes a

A

debit to accounts receivable and credit to sales revenue

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29
Q

Ending WIP Inventory

A

Beginning WIP Inventory + Manufacturing Costs - COGM

30
Q

Amount of allocated overhead w credit balance

A

MOH credit + actual costs

31
Q

Hourly cost

A

annual salary & benefits/ weeks x hours

32
Q

Pivot Tables

A

are not difficult and time consuming, do not provide valuable info

33
Q

“Value Field Settings”

A

displays count, average and sum but not the median

34
Q

What is the departmental overhead rate?

A

allocated towards specific departments based on activities they perform

35
Q

Is plantwide overhead cost allocation computed by dividing the total manufacturing overhead costs of the department by the estimated total quantity of the department’s cost allocation base?

A

No

36
Q

Departmental overhead rate

A

estimated overhead for department/estimated activity for department

37
Q

Using a refined cost allocation system will allow the management team to allocate the manufacturing overhead costs more accurately because

A

cost distortion is lower because indirect costs are assigned equally

38
Q

ABC generally causes the least amount of cost distortion among products because indirect costs are allocated to the products based on

A

the extent to which the activities are used, types of activities used by the product

39
Q

Cost of materials per

A

allocation base x cost allocation rate

40
Q

Costs for departments ABC

A

cost of activity x # in department/allocation base

41
Q

Total manufacturing costs ABC

A

FOR ACTIVITY: material cost + materials (allocation base x cost allocation rate) + assembling (allocation base x cost allocation rate) + packaging (allocation base x cost allocation rate)

42
Q

Overhead cost per product

A

estimated overhead cost for activity/total then multiplied by expected activity; add together all activities then divide by # produced/sold

43
Q

Does lean thinking involve carrying large amount of inventory “just in case”?

A

No

44
Q

Internal failure costs

A

costs incurred when poor quality goods or services are detected and corrected before delivery to customers

45
Q

Is correlation an analytical tool to measure the relationship among at least 4 variables?

A

No

46
Q

Process Costing

A

used for mass production of standard goods not unique goods

47
Q

Are all direct materials added at the beginning of the production process with units 50% of the way through the production process, have a percentage of completion for direct materials of 100%?

A

yes

48
Q

Equivalent Units for Conversion Costs

A

WIP inventory x % complete for conversion + units completed and transferred out

49
Q

Is the last step of the 5 step process costing procedure to summarize the flow of physical units?

A

No

50
Q

Total equivalent units for direct materials

A

units completed and transferred out + ending WIP

51
Q

Total cost of units completed and transferred out

A

units completed and transferred out for material and conversion x cost per unit for material and conversion then add up totals for both material and conversion

52
Q

Cost per equivalent unit

A

cost of materials added/equivalent # of units

53
Q

Why is it important to calculate an equivalent unit cost?

A

the company must allocate both the direct material costs added at the beginning of production and the conversion costs to all units

54
Q

Mixed Cost

A

fixed cost with an added variable cost

55
Q

what does y represent: y= $7.20x+ $790

A

total cost

56
Q

Fixed cost per unit

A

total fixed cost/total number of units produced

57
Q

Is a high-low method theoretically better than regression analysis because the high-low method uses more data points than regression analysis?

A

No

58
Q

variable cost per unit for high-low method

A

highest activity cost - lowest activity cost/ highest activity units - lowest activity units

59
Q

fixed cost for high-low method

A

highest activity cost - (variable cost per unit x lowest activity units)

60
Q

high-low cost

A

fixed cost + (variable cost + unit activity)

61
Q

A manager will use the strength of the relationship between cost and volume in regression analysis to make decisions regarding which of the following?

A

to assist in predicting costs at different volumes within relevant range

62
Q

contribution margin

A

net sales revenue - variable costs or fixed costs + net income

63
Q

operating income with variable costing

A

revenue - variable production expenses - variable selling and admin expenses = contribution margin - fixed prod. expenses - fixed sell/admin expense = operating income

64
Q

How can a breakeven point be calculated?

A

in terms of number of units or in terms of sales revenue

65
Q

Breakeven point

A

fixed costs/ (revenue per unit - variable cost per unit

66
Q

targeting operating income

A

fixed costs by contribution margin ratio

67
Q

contribution margin ratio

A

revenue - variable costs/revenue

68
Q

variable expense per unit

A

total variable expense/number of units

69
Q

if variable cost per unit decreases white sales price per unit and fixed costs remain constant what happenes

A

contribution margin increases and breakeven point decreases

70
Q
A

Ethics in Business and Industry (3 decks)

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