1. Divulging company information (when not legally obligated to do so) would be a violation of which part of the IMA Code of Conduct?
2. Which of the following accounts would appear on the financial statements of ONLY a manufacturing firm?
3. In resolving an ethical conflict, which of the following would NEVER be appropriate?
discussing the matter with the chief executive officer
discussing the matter with an external member of the board of directors
taking the matter to the press where there is no legal requirement
resigning from the position because of a conflict
4. Which of the following costs would NOT be included in calculating inventory values under the absorption-costing basis?
selling and administrative expenses
5. Which of the following costs would be included as part of direct materials in the production of an automobile?
glue for a sticker applied to the automobile
gasoline used to fuel machines in production
none of these
6. Which of the following costs is a product cost?
lease payments on cars used by salespersons
property taxes on factory building
depreciation on office equipment
7. In a traditional manufacturing company, product costs include
direct materials only
direct materials, direct labor, and factory overhead.
direct materials and direct labor only.
direct labor only
8. Which of the following would be an example of a unit-based cost driver?
direct labor hours
9. Altering the dates of shipping documents of next January’s sales to record them as sales in the current year would be a violation of which standard of ethical conduct for management accountants?
all of these
10. Cost behavior analysis focuses on how costs
accounting policy changes over time
react to changes in profit
react to changes in activity level
none of the above
11. Financial accounting information is used for
all of these
12. _______________ is devoted to providing information for external users.
13. Which of the following costs would NOT be included in operating product costs?
research and development
all of these
14. The sum of direct labor and factory overhead is referred to as
direct product costs
15. Inventory balances for the James Enterprises in February 2011 are as follows:
February 1, 2011 February 28, 2011
Raw materials $ 27,000 $21,000
Work in process 48,000 37,200
Finished goods 108,000 90,000
During February, purchases of direct materials were $36,000. Direct labor and factory overhead costs were $60,000 and $84,000, respectively.
1) What is the cost of materials used in production?
2) What are the total manufacturing costs added?
3) What is the cost of goods manufactured?
16. Assume the following data for Gross, Inc., for February:
Beginning finished goods inventory $ 60,000
Beginning work-in-process inventory 40,000
Ending work-in-process inventory 80,000
Ending finished goods inventory 50,000
Factory overhead costs 200,000
Direct materials used 160,000
Direct labor 100,000
What is the cost of goods manufactured for February? BE SURE TO SHOW WORK AND BRIEF EXPLANATION
17. You are a management accountant for the Eugene Division of Lowden Company. Your longtime friend, David Orth, is the Eugene Division manager. David was instrumental in helping you obtain your current position. Because the manager’s annual bonus is based on the amount of profit the Eugene Division reports for the year, David has asked you to “massage the numbers” to make the Eugene Division appear more profitable.
Considering the Standards of Ethical Conduct for Management Accountants, how would you respond to David Orth’s request? EXPLAIN YOUR ANSWER