Furra College Hawassa campuse

Department of Accounting & Finance

Final examination for the course of Cost& Management Accounting I (Regular)
 Academic year :2012 EC, Year : 2nd Time allowed: 2:00hr Instructor : Gurmu Ephrem

ANSWER SHEET
Name ______________________________Id. No. __________________ Sec. _____ Sign. __________
Program: Regular Extension Week End Year: 2nd Department
______
Part One: Multiple choices (20 %)
1._______2._______3.________4.________5._______6.______7.______8._______9.______
10._______11.______12._______13.______14.______15.______16._____17._____18.______
19._______20.______
Part I:True/false (10%) :1._______2._______3._____4._______5._____6._____7.______8.______
9._________10._________

Part III Work out: use attached paper (15%) use the attached paper

Part I: Multiple choose

Instruction: select correct answer and write your answer choice on the Space provided
above

1. When a job is complete:

A. Work-in-Process Control is debited
B. Finished Goods Control is credited
C. the cost of the job is transferred to Manufacturing Overhead Control
D. actual direct materials, actual direct manufacturing labor, and allocated
manufacturing overhead will comprise the total cost of the job
2. All of the following items are debited to Work-in-Process EXCEPT:
A. allocated manufacturing overhead
B. completed goods being transferred out of the plant
C. direct labor consumed
D. direct materials consumed
3. Which of the following statements about normal costing is true?
A. Direct costs and indirect costs are traced using an actual rate.
B. Direct costs and indirect costs are traced using budgeted rates.
C. Direct costs are traced using a budgeted rate, and indirect costs are allocated using
an actual rate.
D. Direct costs are traced using an actual rate, and indirect costs are allocated using a
budgeted rate.
4. In a normal costing system, the Manufacturing Overhead Control account:
A. is increased by allocated manufacturing overhead
B. is credited with amounts transferred to Work-in-Process
C. is decreased by allocated manufacturing overhead
D. is debited with actual overhead costs

5. A job-cost record uses information from:

A. a materials requisition record to record raw material purchases from suppliers
B. a receiving report that indicates the type and quantity of each item received in an
order from a supplier
C. a labor-time card to record an employee's wage rate and hours spent on a
particular job
D. All of these answers are correct.
6. The predetermined rate of indirect-cost rate for each cost pool is computed as
A. budgeted annual indirect costs divided by budgeted annual quantity of cost
allocation base.
B. budgeted annual quantity of cost allocation base divided by budgeted annual
indirect costs.
C. actual annual indirect costs divided by budgeted annual quantity of cost allocation
base.
D. budgeted annual indirect costs divided by budgeted actual quantity of cost
allocation base

7. Job-costing may only be used by:

A. service companies
B. merchandising companies
C. manufacturing companies
D. All of these may use job-costing.
8. Jacobs Company's Assembly Department has materials cost at $4 per unit and
conversion cost at $8 per unit. There are 9,000 units in ending work in process, all of
which are 70% complete as to conversion costs. What are the total costs assigned to
inventory?
A. $50,400 B) $86,400 C) $75,600 D) $108,000
9. If beginning work in process is 2,000 units, ending work in process is 1,000 units, and
the units accounted for equals 5,000 units, what are the units started into production?
A. 7,000 B) 6,000 C) 3,000 D) 4,000
10. Which of the following would not appear as a debit in the Work in Process account of a
second department in a two stage production process?
A. Materials used C) Labor assigned
B. Cost of products transferred out D) Overhead applied
11. One characteristic of products that are mass-produced in a continuous production
process is that
A. The products are identical or very similar in nature.
B. They are grouped in batches.
C. They are produced at the time an order is received.
 D. Their costs are accumulated on job cost sheets
12. Which of the following would not appear as a debit in the Work in Process account of a
second department in a two stage production process?
A. Materials used B) Overhead applied
B. Labor assigned D) cost of products transferred out
13. A process cost accounting system is most appropriate when
A. A variety of different products are produced, each one requiring different types of
materials, labor, and overhead.
B. The focus of attention is on a particular job or order.
C. Similar products are mass-produced.
D. Individual products are custom made to the specification of customers
14. Which of the following cost elements occurs in a process costing system?
A. Direct materials B) Direct labor C) Manufacturing overhead D) All of these
The following data apply to questions 12& 14
Watkins Company had the following production for the month of June:
Units
Work in process, June 1 6,000
Started during June 24,000
Completed and transferred to finished goods 18,000
Abnormal spoilage incurred 3,000
Work in process, June 30 9,000
Materials are added at the beginning of the process. As to conversion cost, work in process was
20% complete at the beginning and 70% complete at the end of the month. Spoilage is detected
at the end of the process.
15. Using the weighted-average method, the equivalent units for June, with respect to
conversion cost, were
A. 23,700. B) 24,300. C) 27,300. D)30,000.
16. Using the first-in, first out (FIFO) method, the equivalent units for June, with respect
to conversion cost, were
A. 19,500. B) 22,500. C) 23,100. D) 26,100.
17. The sale of scrap from a manufacturing process usually would be recorded as a(n)
A. Increase in manufacturing overhead control.
B. Increase in finished goods control.
C. Decrease in manufacturing overhead control
D. Decrease in finished goods control
18. True about working in process
A. The production is continuous and
B. Mass production and the final product is the result of departments.
C. Costs are accumulated by processes or operations or department.
D. All
19. A cost which doesn’t increase the working in process account
 A. DM B. DL C. MOH control D. applied MOH
20. A cost of a product which increased the WIP without taking a time
A. DM B) DL C) FOH D) none
Part II : True / false question

Instruction : say True for correct statement and false for incorrect statement
1. Textile factory used Job order costing method for its cost of product determination
2. Manufacture overhead control account used for recording of Estimated cost of indirect
cost a product
3. Cost added for product under process costing recorded for product
4. process costing used for homogenous product producing company
5. Job order costing used for heterogonous type of product producing company
6. If FOH control is less than applied FOH the difference is called under applied
7. Normal loss cost is avoidable
8. Equivalent cost means a per unit cost that added by a job
9. Cost that may not added by each department is labor cost
10. Direct labor cost is a part of FOH cost
Part III: Work out
1. By using the following data prepare production cost report the equivalent product of
material ,Labor and FOH and equivalent unit cost

Departme Unit Processed and Remain in Normal Added cost for Cost of
nt start to transfer to WIP( 1/3 of lost WIP product
process Testing labor ,1/3 FOH Labor FOH transfer
department from
pervious
Testing 45,000u 40,000u 3,000U 2,000u 37,310 32,800 Br 1.72

2. Using the under given information find the requires questions

Raw material Labor FOH WIP FG
Beginning Br 30,000 Br 4,000 Br 12,000
Purchase 10,000
Used ? 21,000 28,800
Ending 6,000.00 39,800 24,000
Requires

A. Material used
B. Total Manufacturing cost
C. Cost of produced
D. Cost of Goods Sold