In the standard regression equation of y=a+bx, the letter y is best described at the:

In the standard regression equation of y=a+bx, the letter y is best described at the:

A independent variable
B dependent variable
C slope of the equation
D intercept of the equation


Answer: B

Which of the following statements is (are) true regarding product costing?

A individual product costs are relevant for managerial decision-making but irrelevant for preparing the financial statements
B A common decision facing managers is determining the price at which to sell their product or provide their services.
A only A is true
B only B is true
C Both A and B are true
D neither A nor B is true


Answer: B

In the cost equation TC+F+VX, V is best described as:

A costs that do not vary with changes in the activity level.
B intercept of the cost equation
C slope of the cost equation
D activity level used to estimate the dependent variable


Answer: C

Which of the following cost estimation methods finds the variable portion of a mixed cost before calculating the fixed portion?

Which of the following cost estimation methods finds the variable portion of a mixed cost before calculating the fixed portion?

A Scattergraph
B High-Low
C Account analysis
D Linear regression
E engineering approach


Answer: B

A disadvantage of the high-low method of cost analysis is that it:

A typically results in totally inaccurate cost formula
B is too time consuming to apply
C uses only two data points, which may not be representative of normal conditions
D relies totally on the judgement of the person performing the cost analysis


Answer: C

In the standard regression equation of y=a+bx, the letter a is best described as the:

A independent variable
B dependent variable
C slope of the equation
D intercept of the equation


Answer: D

In determining cost behavior in business, the cost function is often expressed as Y= a+bX. Which on the the following cost estimate methods

In determining cost behavior in business, the cost function is often expressed as Y= a+bX. Which on the the following cost estimate methods should NOT be used in estimating fixed and variable costs for the equation?

A Scattergraph method
B Simple regression
C High-Low point method
D Multiple regression
E Management analysis of data


Answer: E

In the cost equation TC=F+VX, X is best described as the:

A costs that do not vary with changes in the activity level.
B costs that do vary with changes in the activity level.
C total cost estimate at a particular activity level.
D activity level used to estimate the total cost


Answer: D

A manager is trying to estimate the manufacturing costs of a new product. The company makes several other products that utilize some of the same manufacturing procedures as the new product. Which cost estimate method would be the best method to determine the total cost of manufacturing the new product?

A Engineering estimates
B Regression analysis
C Account Analysis
D Scattergraph
E High-low

Lakeside Company estimated manufacturing overhead costs for 2009 at $378,000, based on 180,000 estimated direct labor hours

Lakeside Company estimated manufacturing overhead costs for 2009 at $378,000, based on 180,000 estimated direct labor hours. Actual direct labor hours for 2009 totaled 195,000. Manufacturing overhead contains debit entries totaling $391,500. What was the amount of manufacturing overhead for 2009?

A) $31,500 underallocated
B) $31,500 overallocated
C) $18,000 underallocated
D) $18,000 overallocated



Answer: D

The journal entry to record $200 of depreciation on factory equipment for the current period involves which of the following?

A) debit to accumulated depreciation-factory equipment for $200
B) credit to manufacturing overhead for $200
C) debit to depreciation expense-factory equipment for $200
D) debit to manufacturing overhead for $200


Answer: D

Door Company estimated manufacturing overhead costs for 2009 at $378,000. The predetermined manufacturing overhead rate was based on 105,000

Door Company estimated manufacturing overhead costs for 2009 at $378,000. The predetermined manufacturing overhead rate was based on 105,000 estimated direct labor hours. Actual direct labor hours for 2009 totaled 110,000. The manufacturing overhead account showed debit entries totaling $394,000. For the year, was overhead over or underallocated and by how much?

A) $16,000 underallocated
B) $2,000 overallocated
C) $2,000 underallocated
D) $16,000 overallocated


Answer: B

Actual manufacturing overhead for the current period is $19,600 while allocated manufacturing overhead for the current period is $18,700. What is the proper entry to dispose of the manufacturing overhead balance?

A) debit cost of goods sold and credit manufacturing overhead for $900
B) debit cost of goods sold and credit finished goods inventory for $900
C) debit manufacturing overhead and credit cost of goods sold for $900
D) debit manufacturing overhead and credit work in process inventory for $900


Answer: A

Manufacturing overhead is overallocated $1,000 at the end of the current period. The journal entry to dispose of the overallocated overhead balance involves a debit to:

A) manufacturing overhead and a credit to cost of goods sold for $1,000
B) cost of goods sold and a credit to manufacturing overhead for $1,000
C) manufacturing overhead and a credit to work in process inventory for $1,000
D) cost of goods sold and a credit to finished goods inventory for $1,000


Answer: A

The journal entry to assign $1,500 of direct labor and $200 of indirect labor for the current period involves a debit to what account(s)?

The journal entry to assign $1,500 of direct labor and $200 of indirect labor for the current period involves a debit to what account(s)?

A) manufacturing overhead for $1,700
B) work in process inventory for $1,500 and a credit to manufacturing overhead for $200
C) work in process inventory for $1,500 and a debit to manufacturing overhead for $200
D) work in process inventory for $1,700


Answer: C

How is the predetermined manufacturing overhead rate used to allocate manufacturing overhead calculated?

A) by dividing the total estimated manufacturing overhead costs by the total estimated quantity of allocation base
B) by dividing the total estimated quantity of allocation base by the total estimated manufacturing overhead costs
C) by multiplying the total estimated manufacturing overhead costs by the total estimated quantity of allocation base
D) by dividing the total estimated manufacturing overhead costs by the total actual quantity of the allocation base


Answer: A

Which of the following is the most significant cost for a service company which used job order costing?

A) labor costs
B) indirect costs
C) supplies costs
D) overhead costs


Answer: A

The Hemingway Company uses a job costing system. In April, material requisitions of $44,000 were issued (direct materials, $40,000) and materials

The Hemingway Company uses a job costing system. In April, material requisitions of $44,000 were issued (direct materials, $40,000) and materials purchases of both direct and indirect materials totaled $56,600. The ending balance in materials inventory was $18,400. What was the beginning balance?

A) $5,800
B) $31,000
C) $25,600
D) none of the above


Answer: A

Actual manufacturing overhead for 2009 amounts to $102,500, allocated manufacturing overhead for 2009 amounts to $98,700. By how much is manufacturing overhead over/underallocated?

A) $3,800 underallocated
B) $1,900 underallocated
C) $1,900 overallocated
D) $3,800 overallocated


Answer: A

When a job is completed in a job costing system, the journal entry involves which accounts?

A) a debit to finished goods inventory and a credit to work in process inventory for the cost of the job B) a debit to finished goods inventory and a credit to work in process inventory for the sales price of the job
C) a debit to cost of goods sold and a credit to finished goods inventory for the cost of the job D) a debit to work in process inventory and a credit to finished goods inventory for the cost of the job


Answer: A