Test 1 Spring 2008 Chapters 1-3

1.

Managerial accounting:

A)

is more future oriented than financial accounting.

B)

tends to summarize information more than financial accounting

C)

is primarily concerned with providing information to external users.

D)

is more concerned with precision than timeliness.

2.

The function of management that compares planned results to actual results is known as:

A)

planning.

B)

directing and motivating.

C)

controlling.

D)

decision making.

3.

Which of the functions of management involves overseeing day-to-day activities?

A)

Planning

B)

Directing and motivating

C)

Controlling

D)

Decision making

4.

Ideally, how many units should be produced in a just-in-time manufacturing system?

A)

budgeted customer demand for the current week.

B)

budgeted customer demand for the following week.

C)

actual customer demand for the current week.

D)

maximum production capacity for the current week.

5.

After careful planning, Jammu Manufacturing Corporation has decided to switch to a just-in-time inventory system. At the beginning of this switch, Jammu has 30 units of product in inventory. Jammu has 2,000 labor hours available in the first month of this switch. These hours could produce 500 units of product. Customer demand for this first month is 400 units. If just-in-time principles are correctly followed, how many units should Jammu plan to produce in the first month of the switch?

A)

370

B)

400

C)

430

D)

470

6.

Management accounting focuses primarily on providing data for:

A)

internal uses by managers.

B)

external uses by stockholders and creditors.

C)

external uses by the Internal Revenue Service.

D)

external uses by the Securities and Exchange Commission.

7.

Indirect labor is a part of:

A)

Prime cost.

B)

Conversion cost.

C)

Period cost.

D)

Nonmanufacturing cost.

8.

The cost of lubricants used to grease a production machine in a manufacturing company is an example of a(n):

A)

period cost.

B)

direct material cost.

C)

indirect material cost.

D)

none of the above.

9.

The salary paid to the president of King Company would be classified on the income statement as a(n):

A)

administrative expense.

B)

direct labor cost.

C)

manufacturing overhead cost.

D)

selling expense.

10.

Direct labor cost is a part of:

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