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MT 1 Inclass Review Questions

MT 1 Inclass Review Questions
Course

Introductory Management Accounting (BUSI 294)

26 Documents
Students shared 26 documents in this course
Academic year: 2023/2024
Listed booksIntroduction to Managerial AccountingManagerial Accounting
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BUSI 294

Inclass Midterm Review Questions Question 1

Find the required amounts, assuming each is an independent case.

a. Direct Materials Beginning balance $14, Ending balance 28, Purchases 96, Direct materials used?

b. Finished Goods Inventory Cost of goods manufactured 124, Ending balance 40, Cost of goods sold 122, Beginning balance?

c. Work in Process Inventory Ending Balance 44, Cost of goods manufactured 42, Beginning balance 16, Current manufacturing costs?

d. Merchandise Inventory Purchases 420, Cost of goods sold 446, Beginning balance 82, Ending balance?

Question 2

X Company reported the following actual cost data for the year:

Purchase of raw material (all direct) $266, Direct labour cost 160, Manufacturing overhead cost 246, Change in inventories: Decrease in raw materials $10, Decrease in work in process 8, Decrease in finished goods 16,

X Company used a 150% predetermined overhead rate based on direct labour cost. The rate was based on annual estimated overhead cost and direct labour cost of $252,000 and $168,000, respectively.

Required:

  1. Calculate the cost of goods manufactured using the pre-determined overhead rate.
  2. What was the cost of goods sold before adjusting for any under or overapplied overhead?
  3. By how much was manufacturing overhead cost under or overapplied?
  4. Prepare a summary journal entry to close any under or overapplied manufacturing overhead cost to cost of goods sold. Is such an entry appropriate in this situation? Why or why not?

Question 4

Best Products Inc. retails two products, the Basic Gadget and the Deluxe Gadget. The following financial information has been provided:

Basic Deluxe Units sold 120,000 80, Unit selling price $40 $ 70. Unit variable cost 30 35.

Fixed costs for the company totaled $ 3,000,000 and are not allocated to individual products.

Required:

  1. Compute the break-even point in units. How many units of each product will have to be sold to achieve the break-even point?
  2. Compute the break-even point in sales revenue.
  3. The company is considering adding a new product, the Widget. The Widget will sell for $100 and have variable costs of $50 per unit. If the Widget is added to the product line, it is anticipated that sales volume for the Basic Gadget will decline by 7% and by 12% for the Deluxe Gadget. Fixed costs will increase by $100,000 and the company will only produce the Widget if total income will increase by at least $80,000. How many units of the Widget will the company have to sell to meet its objective?
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MT 1 Inclass Review Questions

Course: Introductory Management Accounting (BUSI 294)

26 Documents
Students shared 26 documents in this course

University: The University of British Columbia

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BUSI 294
Inclass Midterm Review Questions
Question 1
Find the required amounts, assuming each is an independent case.
a. Direct Materials Beginning balance $14,000
Ending balance 28,000
Purchases 96,000
Direct materials used ?
b. Finished Goods Inventory Cost of goods manufactured 124,000
Ending balance 40,000
Cost of goods sold 122,000
Beginning balance ?
c. Work in Process Inventory Ending Balance 44,000
Cost of goods manufactured 42,000
Beginning balance 16,000
Current manufacturing costs ?
d. Merchandise Inventory Purchases 420,000
Cost of goods sold 446,000
Beginning balance 82,000
Ending balance ?

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