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Exam 26: Accounting for Manufacturing Activities

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Question 21

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Six adjusting entries are made at the end of the fiscal year for inventory accounts in a manufacturing operation.

A) True
B) False

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Question 22

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Complete the chart below by placing an "X" under the column heading that identifies the type of cost listed to the left.

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Question 23

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The following information appears on the Statement of Cost of Goods Manufactured for the Ethridg Company at the end of the year. Cost of Goods Manufactured for the year is:

Using only the relevant items from the information given, determine the total product cost for Donnybrook Corporation, a manufacturer of children's furniture. In addition, categorize each line item as either Direct Material (DM), Direct Labor (DL)or Overhead (OH). If an item does not tall under any of these categories, then classify as N/A. All materials purchased were used in inventory during the current period. There was no beginning inventory.

Gross profit for a manufacturing business is calculated by deducting cost of goods manufactured from net sales.

The end-of-period adjusting entries are:

In a manufacturing company, it is not necessary to take a physical inventory of the finished goods.

The beginning and ending balances of the finished goods inventory are not used in the computation of cost of goods manufactured.

The balance sheet of a manufacturing firm will include Raw Materials, Work in Process, Manufacturing Overhead and Finished Goods inventory accounts.

The cost of goods manufactured is calculated by:

The following information appears on the Statement of Cost of Goods Manufactured for the Coleman Company at the end of the year. $\begin{array}{lr}\text { Raw Materials Used } & \$ 50,000 \\\text { Manufacturing Overhead } & 60,000 \\\text { Total Manufacturing Costs } & 181,000 \\\text { Work in Process Inventory, January 1 } & 13,500 \\\text { Cost of Goods Manufactured } & 145,000\end{array}$ The balance in Work in Process Inventory at year-end is:

The cost of goods sold will often differ from the cost of goods manufactured because of changes in the quantity of finished goods.

All manufacturing costs, except those for direct labor and direct materials, are included in-----------.

The Cost of Goods Sold section of the income statement for a manufacturing business shows the balance of the work in process inventory.

The three components of total manufacturing cost are:

Ajax Company's manufacturing overhead cost per unit is 125% of the direct labor cost per unit. If Ajax Company's total direct labor cost for the 4,340 units manufactured totaled $56,420, what is the manufacturing overhead cost per unit?

The Balance Sheet of a manufacturing firm includes which account that will not be included in the Balance Sheet of a merchandising or service firm?

As part of the adjusting entries, the beginning inventory of finished goods is closed into the-----------account.

Use the following information for Hardy Co. $\begin{array}{lr}\text { Raw Materials Used } & 5,000 \\\text { Direct Labor } & 7,000 \\\text { Manufacturing Overhead } & 5,100 \\\text { Work in Process Inventory, January 1 } & 3,000 \\\text { Work in Process Inventory, December 31 } & 4,000\end{array}$ Hardy, Co.'s manufacturing costs added during the current year is:

On a worksheet for a manufacturing business, the beginning inventory of finished goods is extended to the -------------Debit column.