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Study4smart

Quality review Materials

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ch18 Key1 . TR U E

2 . FALSE

3 . TR U E

4 . TR U E

5 . TR U E

6 . FALSE

7 . TR U E

8 . TR U E

9 . TR U E

10. FALSE11. TRUE12. TRUE13. TRUE14. TRUE15. FALSE16. FALSE17. TRUE18. FALSE19. TRUE20. FALSE21. TRUE22. FALSE23. FALSE24. TRUE25. TRUE26. FALSE27. TRUE28. FALSE29. TRUE

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32. FALSE33. TRUE34. TRUE35. FALSE36.

TRUE

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37. TRUE38. FALSE39. TRUE40. FALSE41. FALSE42. FALSE43. TRUE44. FALSE45. TRUE46. FALSE47. TRUE48. TRUE49. FALSE50. FALSE51. FALSE52. FALSE53. TRUE54. FALSE55. B56. C57. D58. E59. E60. D61. C62. A63. B64. C65. E66. E67. B68. B69. D70. B71. A72. E

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75. C76. A77. B78. A79. C80. D81. A82. D83. A84. D85.

B

86. B87. C88. D89. C90. A91. E

133.B

134.C135.A136.Costs that have already been incurred and cannot be avoided or changed:: Sunk costs andCosts that are incurred for the benefit of

more than one cost object :: Indirect costs andExpenditures necessary and integral to finished products :: Product costs andExpenditures

directly associated with the manufacture of finished products; include direct materials and direct labor :: Prime costs andCosts that do no

change in total with changes in the volume of activity :: Fixed costs andThe potential benefit lost by choosing a specific action from two or

more alternatives :: Opportunity costs andCosts that flow directly to the current income statement as expenses :: Period costs and

Expenditures incurred in the process of converting raw materials to finished products; include direct labor and factory overhead::

Conversion costs andManufacturing expenditures that cannot be separately or readily traced to finished goods :: Factory overhead andCosts

that change in proportion to changes in volume of activity :: Variable costs

137.An activity that provides financial and nonfinancial information to an organization's managers and other internal decisionmakers :: Managerial accounting andAn idea that rejects the notions of "good enough" and "acceptable" and challenges employees and

managers to continually experiment with new and improved business practices :: Continuous improvement andGoods a company acquires

to use in making products :: Raw materials inventory andAn idea that means that employees understand the changing needs and wants of

their customers and align their management and operating practices accordingly:: Customer orientation andA system that acquires inventory

and produces only when needed :: Just-in-time manufacturing andProducts in the process of being manufactured but not yet complete::

Goods in process inventory andA model whose goal is to eliminate waste while satisfying the customer and providing a positive return

to the company :: Lean business model andAn approach that aids continuous improvement by augmenting financial measures with information

on the drivers or indicators of future financial performance along the four dimensions of (1) financial, (2) customer, (3) internal business

processes; (4) learning and growth :: Balanced scorecard andExpenditures directly associated with the manufacture of finished goods; includes

direct materials and direct labor :: Prime costs andThe sum of process time, inspection time, move time and wait time :: Cycle time

138.M :: Users are generally managers, employees and decision makers internal to the organization. andM :: Used to assist managers in makingplanning and control decisions. andF :: Information is structured and controlled by GAAP. andM :: Information is available quickly withoutthe need to wait for an audit. andF :: Information is mainly historical with some predictions. andF :: Emphasis of the information is on the

whole organization. andM :: Information is mostly monetary, but includes nonmonetary information.

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139.The three basic cost elements in accounting for manufactured goods are direct material costs, direct labor costs, and factory overheadcosts.

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can be traced to individual units or batches of products. Factory overhead lists all of the indirect manufacturing costs. Finally, the direct

materials, direct labor, and factory overhead are added to determine total manufacturing costs. Beginning goods in process is added to total

manufacturing costs; ending goods in process are subtracted to determine the cost of goods manufactured.

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Feedback:

157. Answers will vary

(b) Current Assets - Rockland Industries:

Feedback: (a) Rockland Industries is the manufacturer. It has three types of inventories: raw materials, goods in process, and finished goods. It

converts materials to finished goods.

158. Answers will vary

Feedback:

159. Answers will vary

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Feedback:

161. Answers will vary

Feedback:

162. Answers will vary

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Feedback:

164.

Answers will

vary

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Feedback:

167. Answers will vary

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Feedback:

169. Answers wil l vary

170. Managerial accounting171. P l a nni ng172. C o n t r o l173. Internal; External174. Just-In-Time (JIT) or Just-In-Time-Manufacturing

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175. Lean business model176. Continuous improvement177. Balanced scorecard178. F r a u d179. Internal Control180. E t h i c s181. Traceability182. Opportunity Cost183. Va r i a b l e184. F i x e d185. M i x e d186. S u n k187. Out-of -poc ket188. P r o d u c t189. P e r i o d190. Ra w ma ter i a l s191. Goods in process or work in process192. Finished goods193. Goods in Process194. Cost of goods manufactured195. Wait t ime196. Cycle efficiency197. Conversion Costs198. P r i m e199. $12,500 ($2,000 + $11,500 - $1,000)200. Cost of Goods Manufactured

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ch18 Summary

Category # of Q

AACSB: Analytic 1

AACSB: Communications 7

AACSB: Ethics 1

AICPA BB: Critical Thinking

AICPA BB: Industry 1

AICPA BB: Legal

AICPA BB: Resource Management 6

AICPA FN: Decision Making 3

AICPA FN: Measurement 12

AICPA FN: Measurement, Decision Making

AICPA FN: Reporting 2

AICPA FN: Risk Analysis 1

Blooms: Analyze

Blooms: Apply 3

Blooms: Remember 1

Blooms: Understand 6

Difficulty: Easy 9

Difficulty: Hard 3

Difficulty: Medium 6

Fundamental - Chapter 18 2

Learning Objective: A1 Compute cycle time and cycle efficiency; and explain their importance to production management

Learning Objective: C1 Explain the purpose and nature of; and the role of ethics in; managerial accounting. 3

Learning Objective: C2 Describe accounting concepts useful in classifying costs. 3

Learning Objective: C3 Define product and period costs and explain how they impact financial 2

Learning Objective: C4 Explain how balance sheets and income statements for manufacturing and merchandising companiesdiffer 1

.

Learning Objective: C5 Explain manufacturing activities and the flow of manufacturing costs.

Learning Objective: C6 Describe trends in managerial accounting. 2

Learning Objective: P1 Compute cost of goods sold for a manufacturer. 3

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Learning Objective: P2 Prepare a manufacturing statement and explain its purpose and links to financial statements. 3