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Midterm Review

1782 words - 8 pages

BA 213 - Test#1 Review Instructor: Usha Ramanujam

1. Pizza World makes forty-three kinds of pizza for takeout and delivery. Which of the following could be the constraint at Pizza World?
A) the person who makes the pizza crust.
B) the person who puts toppings on the pizzas.
C) the pizza oven.
D) any of the above could be the constraint.

2. The Standards of Ethical Conduct for Management Accountants developed by the Institute of Management Accountants contain a policy regarding confidentiality that requires management accountants to refrain from disclosing confidential information acquired in the course of their work:
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The nursing station on the fourth floor of Central Hospital is responsible for the care of patients who have undergone orthopedic surgery. The costs of drugs administered by the nursing station to patients would be classified as:
A) direct costs of the patients.
B) indirect costs of the patients.
C) overhead costs of the nursing station.
D) period costs of the hospital.

| |Number of Units Produced|Unit Cost |Total Cost |
|Cost A | | |
| |1 |? |$10 |
| |10 |? |$100 |
| |100 |? |$1,000 |
| |1,000 |? |$10,000 |
| | | | |
| | | | |
|Cost B | | |
| |1 |$5,000 |? |
| |10 |$500 |? |
| |100 |$50 |? |
| |1,000 |$5 |? |

Which of the above best describes the behavior of Costs A and B?
A) Cost A is fixed, Cost B is variable.
B) Cost A is variable, Cost B is fixed.
C) Both Cost A and Cost B are variable.
D) Both Cost A and Cost B are fixed.

7. John Johnson decided to leave his former job where he earned $12 per hour to go to a new job where he will earn $13 per hour. In the decision process, the former wage of $12 per hour would be classified as a(n):
A) sunk cost.
B) direct cost.
C) fixed cost.
D) opportunity cost.

8. The following costs were incurred in March:

| |Direct materials |$21,000 |
| |Direct labor |$17,000 |
| |Manufacturing overhead |$67,000 |
| |Selling expenses |$16,000 |
| |Administrative expenses |$15,000 |

Conversion costs during the month totaled:
A) $88,000
B) $38,000
C) $136,000
D) $84,000

9. The following costs were incurred in February:

| |Direct materials |$39,000 |
| |Direct labor |$18,000 |
| |Manufacturing overhead |$14,000 |
| |Selling expenses |$13,000 |
| |Administrative expenses ...

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