DEPARTMENT OF ACCOUNTANCY COMM 305 & ACCO 240
OHN MOLSON SCHOOL OF BUSINESS ALL SECTIONS
MID TERM EXAMINATION
PLEASE READ THIS PAGE – IT CONTAINS IMPORTANT INFORMATION BEFORE STARTING TO WRITE BE SURE YOU ARE WRITING IN THE CORRECT EXAM ROOM RELATED TO YOUR SECTION.
1. This examination will last Three (3) hours and consists of Five (5) Questions printed on (8) pages including this page. Make sure your copy of the exam is complete before starting.
2. Write all your answers (including answers to multiple-choice statements) in the lined examination answer booklet that has been provided to you separately. You may answer the Questions in any order. Indicate clearly your professor’s name in the front of the booklet.
3. Your answers may be written in pencil or ink.
4. Read the Questions carefully and budget your time carefully. Show details of all work in order to benefit from part marks, except for Multiple-choice questions. Attempt all Questions.
5. This is a closed book examination; no reference to notes, etc. is allowed. However, a silent hand-held four-function calculator and one standard (not electronic) dictionary are permitted.
6. Invigilators will not answer questions, unless you think there is an error in the examination questionnaire.
QUESTION I 15 POINTS
Select the best answer. 1 mark each
1. Managerial accounting
a. is concerned with costing products.
b. is governed by generally accepted accounting principles.
c. pertains to the entity as a whole and is highly aggregated.
d. places emphasis on special-purpose information.
2. In which of the following categories do indirect materials belong?
3. Which beginning and ending inventories appear on a cost of goods manufactured schedule?
a. Raw materials only
b. Raw materials and work in process only
c. Raw materials, work in process, and finished goods
d. Work in process only
4. Luca Company overapplied manufacturing overhead during 2008. Which one of the following is part of the year end entry to dispose of the overapplied amount assuming the amount is material? a. An increase to Finished Goods b. A decrease to Applied Overhead c. A decrease to Work in Process Inventory d. An increase to Cost of Goods Sold
5. What is the best way to handle manufacturing overhead costs in order to get the most timely job cost information? a. The company should account for only the direct production costs. b. The company should apply overhead using an estimated rate throughout the year.
c. The company should add actual manufacturing overhead costs to jobs as soon as the overhead costs are incurred.
d. The company should determine an allocation rate as soon as the actual costs are known, and then apply manufacturing overhead to jobs.
6. At the end of the year, Manufacturing Overhead has been overapplied. What occurred to create this situation?
a. The company incurred more total job costs than the amount budgeted for the job.
b. The actual manufacturing overhead costs were less than the manufacturing overhead assigned to jobs.
c. The company incurred more manufacturing overhead costs than the manufacturing overhead assigned to jobs.
d. Estimated manufacturing overhead was less than actual manufacturing overhead costs.
7. Which one of the following is a similarity of both a job order and a process cost system? a. They both track direct materials and direct labour, but not manufacturing overhead. b. They both track conversion costs, but not materials. c. They both track the same three manufacturing cost elements – direct materials, direct labour, and manufacturing overhead. d. They both are used for the same type of inventory production items.