Quiz For Cost

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1.) Spoiled units may be corrected, and sold at the price of good unit . ans.False
2.) If the amount of materials on hand is more than the balance in the materials control account
there is shortage ans. False
3.) In backfluch accounting, direct materials is usually insignificant in a highly automated
system, so is not cost effective to account for it separately. Ans.False
4.) When the scrap value is small, no entry is required even if the scrap is sold due to
immateriality. Ans. True
5.) For materials returned to vendors the books of original entry is the general ledger.
Ans.False
6.) Production process in a non-value added activity. Ans. False
7.) The factors to be considered in determining order and carrying costs for a particular order
and carrying costs for a particular company carry with the nature of operations and the
organizational structure. Ans. True
8.) WALA HIPOS
9.) An effective system of cost control is designed to control the actions of people responsible
for the expenditures because cost control themselves. Ans. False
10.)The stock card contains an account for each material used in the manufacturing process.
Each account shows the number of units on hand and their cost. Ans. TRUE
11.)Factory overhead account is debited for indirect materials issued to production even under
backflush costing. Answer,FALSE
12.)Storing materials in the storeroom is an example of non-value added activity. Ans.. TRUE
13.)Under investment control there must be limited access and segregation of duties. Ans.
FALSE
14.)The received columns in the stock cards are used every time purchases are made. Ans.
TRUE
15.)The revenue from scrap sales should be credited to income account all the time. Ans. False
16.)Arwen Company has correctly computed its economic order quantity at 500 units; however,
management (pota laba) ans. Lower total order cost and higher total carrying cost.
17.) If the amount of materials on hand at the end of the period is more than the control
account balance, the following entry should be made: ans. Debit- Materials Credit-
factory overhead
18.)The data used to calculate the order point include all the following except: ans. The costs
of placing an order.
19.)In a period of falling prices, the use of which of the following cost flow methods would result
in the highest cost of goods sold? Ans. FIFO
20.)Carrying costs would include all of the following except: ans. Inspection employees’ wages
21.)The employee who is responsible for ordering the required materials from the supplier is
most likely the: ans. Purchasing Agent
22.) Just-in-time production techniques: answer. Require a high degree of cooperation and
coordination between supplier and manufacturer.
23.)During the March, Hart Company incurred the following costs on Job 120 for the
manufacture 0f 200 motors: Ans: A debit to Factory Overhead amounting to 550
24.)To effectively control materials, a business must maintain: Ans. Limited Access.
25.)The form that serves as an authorization to withdraw materials from the storeroom is
known as the: ans. Materials Requisition.
26.)At the end of the period, the balance in the materials account should represent.. ans: The
cost of materials on hand, not yet put into production.
27.)Listed below are steps or procuring materials for production: ans. 4213
28.)In a backflush accounting system, a single account is used for the following: ans. Labor and
Overhead
29.)The general ledger entry to record the purchase of material is: ans. Debit Materials Credit
Accounts payable.
30.)In a period of rising prices, the use of which of the following cost flow methods would result
in the lowest gross margin ans. LIFO
31.)Xander Company anticipates that usage of component t WILL BE 100 units
daily……..compute the order point…. Answer 1500
32.)The following accounts are maintained by the Ideal Manufacturing Company in its general
ledger: …….. What is the balance of the materials account on January 31?....ans. 41,450
33.)The following data refer to various annual costs relating to the inventory of a single-product
company that requires 10,000 units per year:………What is the annual carrying cost per
unit?.....answer .34
34.)Rowe co.’s Job 401 for manufacture of 2,100 wagons was completed during August……..How
much should be recognized as spoiled goods inventory?.......answer 3,300
35.)The Kennedy Company uses throtties in its assembly of lawn mowers………If a perpetual
inventory record of throtties is …………June 14 will have a unit cost of… ans. 3,386
36.)The Ferme Manufacturing produces sporting equipment. The company maintains a single
raw materials inventory account……… Compute the cost of direct materials used during the
month of December… ans. 608,200
37.)Expected annual usage of a particular raw materials od 180,000…. Assuming the company
DOES NOT maiantain safetystock…..ans, 6,000
38.)The Egbert Company uses an industrial chemical, XRG…….. ans. 2,625
39.)Harrison Industries Produces 4,000 lunch boxes each day. ………..What would the
throughput time….. ans. Two days
40.)Rowe co’s Job 401… How much should be Factory Overhead? Ans… 4,200
41.)Xander Company anticipates that usage of Component…… How much is the total order cost
at EOQ…ans 500
42.)The materials account of the Lankford Company…. How much is the total Cost of units
Issued using FIFO method.. ans. 9,540
43.)Harrison Industries produces 4,000….. Harrison is able to be implement the recommended
changes? …. Ans 2,000
44.)The Bisset Corporation uses RAW material A……… How much is the cost of 200 units on hand
as of August 18… answer 320.5
45.)During the March, Hart Company incurred the following…. What is the cost per finished unit
of Job 125……answer 27

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