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Krannert School of Management
MGMT 201 – Managerial Accounting I
Practice Midterm Exam
This practice exam consists of 30 multiple choice questions on 11 pages (including this cover page). Answer all questions.
No partial credit is available for multiple choice questions. Be sure to put your answers to the multiple choice questions on your Scantron form.
The exam is closed book. A basic four function calculator is permitted. GOOD LUCK.
Please circle the best answer and fill-in the corresponding circle on your Scantron sheet. Only answers on the Scantron will be scored.
a. is unregulated.
b. produces information that is useful only for manufacturing organizations. c. is based exclusively on historical data.
d. is regulated by the Securities and Exchange Commission (SEC).
The accounting records of Dolphin Company revealed the following information:
Dolphin's cost of goods sold is:
Costs that are expensed when incurred are called:
a. product costs.
b. direct costs.
c. inventoriable costs.
d. period costs.
When 5,000 units are produced variable costs are $35 per unit and total costs are $200,000. What are the total costs when 8,000 units are produced? a. $200,000.
d. Cannot be determined from the information given.
MGMT 201 Practice Midterm Exam—Page 2
Which of the following is the correct method to calculate a predetermined overhead a. Budgeted total manufacturing cost ÷ budgeted amount of cost driver. b. Budgeted overhead cost ÷ budgeted amount of cost driver. c. Budgeted amount of cost driver ÷ budgeted overhead cost. d. Actual overhead cost ÷ budgeted amount of cost driver.
Armada Company applies manufacturing overhead by using a predetermined rate of 150% of direct labor cost. The data that follow pertain to job no. 831: Direct Material Cost
Direct Labor Cost
If Armada adds a 30% markup on total cost to generate a profit, which of the following choices depicts a portion of the accounting needed to record the credit sale of job no. 831? a.
Debit Accounts Receivable
Credit Accounts Receivable
Debit Accounts Receivable
Debit Finished Goods Inventory
Jacobs, Inc. disposes of under- or overapplied overhead at year-end as an adjustment to cost of goods sold. Prior to disposal, the firm reported cost of goods sold of $590,000 in a year when manufacturing overhead was underapplied by $15,000. If sales revenue totaled $1,400,000, determine (1) Jacobs’ adjusted cost of goods sold and (2) gross margin. a.
Serina Manufacturing recently sold goods that cost $35,000 for $45,000 cash. The journal entries to record this transaction would include:
a. a credit to Work-in-Process Inventory for $35,000.
b. a debit to Sales Revenue for $45,000.
c. a debit to Finished-Goods Inventory for $35,000.
d. a credit to Sales Revenue for $45,000.
MGMT 201 Practice Midterm Exam—Page 3
Pineapple Company uses a weighted-average process-costing system. Company records disclosed that the firm completed 40,000 units during the month and had 10,000 units in process at month-end, 20% complete. Conversion costs associated with the beginning work-in-process inventory amounted to $231,000, and amounts that relate to the current month totaled $966,000. If conversion is incurred uniformly throughout manufacturing, Peach's equivalent-unit cost is: a. $23.00.
Quattro Products started and finished job no. J42 during June. The job required $15,000 of...
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