ACCT 2220 Exam 1 Review Questions
Waverly Company paid $5,000 cash for wages of production workers. This business event would:
a. increase total assets and total equity.
b. increase one asset account and decrease another
ACCT 2220 Chapter 7 Review Questions
Strategic planning focuses on
a. short-range decisions.
b. intermediate-range decisions.
c. sales targets.
d. long-range decisions.
A plan that formalizes in financial terms the overall goals and objectives of a
ACCT 2220 Chapter 5 Review Questions
Roadster Tires produces a variety of auto and truck tires at its Dayton manufacturing plant. The plant is
highly automated and uses an activity-based costing system to allocate overhead costs to its various
Chapter 2 Lecture: Cost Behavior, Operating Leverage, and Profitability Analysis
Fixed Cost: A cost that remains constant in total regardless of changes in the volume of activity.
Ex: Suppose two children each ask to bring a friend along on a family vac
Chapter 3 Lecture
Analysis of Cost, Volume, and Pricing to increase Profitability
Break-Even: Where income equals zero.
-In order to cover our costs and not lose money, we have to break even
-The break-even point is found by using one of the follo
Lecture Chapter 9: Responsibility Accounting
Static Budgets: managers prepare these budgets based on the planned volume of activity at the
beginning of an accounting period.
Flexible Budgets: managers prepare these budgets based on the actual volume of
Lecture Chapter 11: Product Costing in Service and Manufacturing Entities
1. Nature & Treatment of Product Cost Information for Manufacturing & Service Companies
-The flow of manufacturing costs through the inventory accounts (raw materials, work in pro
Lecture Chapter 8: Performance Evaluation
-Be aware that the greatest stumbling block to calculating variances is confusion over terminology.
-The actual computations involve simple algebra. The difficulty arises from trying to decide which variables to
Chapter 7 Lecture: Planning for Profit and Cost Control
Describe the Budgeting Process and the Benefits it provides
-Companies must have a PLAN to operate efficiently and effectively.
Budgeting: Expressing the plan in financial terms.
-The process o
Chapter 6 lecture: Relevant Information for Special Decisions
Davis Driveways, Inc. (DDI) pours concrete driveways for single family homes. DDI uses a cost-plus pricing
approach. The companys accountant prepared the following report showing how DDI esta
ACCT 2220 Chapter 4 Review Questions
The process of assigning a cost to two or more designated cost objects is
a. cost tracing
b. cost allocation
c. cost/benefit analysis
d. cost classification
Of the following statements, which is NOT true concerni
ACCT 2220 Chapter 6 Review Questions
Use the following information to answer the next three questions.
Harcourt Marketing (HM) has the capacity to produce 10,000 fax machines per year. HM currently
produces and sells 7,000 units per year. The fax machines
Lecture Chapter 1
Financial Accounting: is a branch of accounting focused on the business information needs of external
users. The objective of financial accounting is to classify and record business events and transactions to
produce external financia
Lecture 4: Cost Accumulation, Tracing, and Allocation
Identify Cost Objects and Cost Drivers
-The need to make allocations causes widespread problems.
Allocation: Dividing a total into parts and assigning those parts to different objects the effort to
Answers to Questions 1. Budgets are useful for large companies with complex activities as well as small companies. Budgets act as a vehicle for communication by formalizing management's plans in a document that communicates company objectives. The benefit
Ash Creek Company is preparing its master budget for 2014. Relevant data pertaining to its sales,
production, and direct materials budgets are as follows.
Sales: Sales for the year are expected to total 1,000,000 units. Quarterly sales are 20%, 20%, 30%,
Chapter 4 Homework
1. Kenneth Corporation expects to incur indirect overhead costs of $112,575 per month and direct
manufacturing costs of $23 per unit. The expected production activity for the first four months of 2013 is
Chapter 3 homework
1. Use the table below to answer the following questions.
Selling Price = $35.000
a. Determine the sales volume, fixed cost, and variable cost per unit at the break-even point.
Sales Volume= _bottles
Variable cost per u
1. Veasy Corporation paid one of its sales representatives $8,000 during the month of March. The rep is
paid a base salary plus $10 per unit of product sold. During march, the rep sold 190 units.
a. Calculate the total monthly cost of the
1. A review of the accounting records of Spiller manufacturing indicated that the company incurred the following
payroll costs during the month of September.
1. Salary of the company president - $31,200
2. Salary of the vice president o
Exam 1 Review Sheet
The exam will consist of true/false, multiple choice, fill the blank, and problems.
The true/false and multiple choice questions consist of definitions and concepts found in the written part of the
textbook and lecture. Very few o
Exam 1 Equations
Total Product Cost = Raw Materials + Labor + Overhead Costs
(Depreciation of production equipment)
Average Cost Per Unit = Total Product Cost
Cost of Goods Sold = Average Cost per Unit x Sold
Online Practice Exam 1
1. Issa Manufacturing Company was started on January 1, 2014, when it acquired $77,000 cash by issuing
common stock. Issa Immediately purchased office furniture and manufacturing equipment costing $9,400
and $25,500, respectively
Exam 1 review sheet
1. Difference between Managerial and Financial Accounting-
Managerial Accounting: Focused on the information needs of managers and others working within the
business. To gather and report information that adds value to t
Answers to Questions 1. People, not budgets, control costs. Ms. Kelly needs to use the budget system to build a responsibility accounting program. The managers must be motivated to control costs. They should be trained to use the budgets as tools in helpi