COST ACCOUNTING
ACCT 2309 – SUMMER 2012
FINAL REVIEW
1. Budgeting is used to help companies:
a. plan to better satisfy customers
b. anticipate potential problems
c. focus on opportunities
d. All of these answers are correct
2. A budget should/can do all of the following EXCEPT:
a. be prepared by managers from different functional areas working independently of each
other
b. be adjusted if new opportunities become available during the year
c. help management allocate limited resources
d. become the performance standard against which firms can compare the actual results
Answer questions 9 through 12 using the information below:
Daniel, Inc., expects to sell 6,000 ceramic vases for $20 each. Direct materials costs are $2,
direct manufacturing labor is $10, and manufacturing overhead is $3 per vase. The following
inventory levels apply to 20X4:
Beginning inventory Ending inventory
Direct materials 1,000 units 1,000 units
Work-in-process inventory 0 units 0 units
Finished goods inventory 400 units 500 units
3. On the 20X5 budgeted income statement, what amount will be reported for sales?
a. $246,000
b. $118,000
c. $140,000
d. $120,000
4. How many vases need to be produced in 20X5?
a. 5,900 vases
b. 6,100 vases
c. 7,000 vases
d. 6,000 vases
5. On the 20X5 budgeted income statement, what amount will be reported for cost of goods
sold?
a. $91,500
b. $105,000
c. $90,000
d. $88,500
6. What are the 20X5 budgeted costs for direct materials and direct manufacturing labor?
a. $ 12,200 and $ 61,000
b. $ 12,000 and $ 60,000
c. $ 2,000 and $ 10,000
d. $ 2,000 and $ 0