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Business Management Questions Multiple Choice

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1. Place the following Process costing steps in the correct order: 1 - Calculate equivalent units 2 - Determine the total costs to account for 3 - Analyze flow of physical units 4 - Assign total manufacturing costs 5 - Compute unit costs





None of the above

2. Direct materials and direct labor costs total $70,000, conversion costs total $60,000, and factory overhead costs total $100 per machine hour. If 300 machine hours were used for Job #222, what is the total manufacturing cost for Job #222?

1. $30,000
2. 60,000
3. $70,000
4. 90,000
5. $100,000

3. L & L, CPAs, employs two full-time professional CPAs and five other accountants. Budgeted direct salary costs include $150,000 for each CPA and $40,000 per other accountant. For 2001 year, indirect costs were budgeted at $200,000, but actually amounted to $225,000. Actual salaries were $155,000 for each CPA and $45,000 for each accountant. Direct and indirect costs are applied on a labor-hour basis. Total budgeted labor-hours were 5,000. If a client used 500 labor-hours, what are the budgeted direct-cost rate and the budgeted indirect cost rate, respectively?

1. $100; $45

2. $100; $40

3. $90; $40

4. $101; $40

5. 107; $45

4. If estimated annual factory overhead is $480,000, estimated annual direct labor hours are 200,000, actual March factory overhead is $41,000, and actual March direct labor hours are 17,000, then overhead is:

a. $800 overapplied

b. $200 overapplied

c. $800 underapplied

d. $200 underapplied

e. $ 1000 underapplied

5. Which of the following industries is more suitable for using a job costing system?
1. chemical plants.
2. petroleum product manufacturing
3. medical clinics.
4. cement manufacturing
5. food processing.

6. The ideal criterion for choosing an allocation base is:

1. ease of calculation.
2. a cause-and-effect relationship
3. ease of use
4 its preciseness.

5. its applicability.

8. "Investment myopia" tends to cause managers to avoid new investment because the returns may be uncertain and may not:

a. be actually realized.

b. reach minimum goals.

c. be realized for some time.

d. exceed minimum goals.

e. do all of the above.

9. On March 1, Atlanta Company had 20,000 units of WIP in Department A, which were 100% complete as to material costs and 30% complete as to conversion costs. During March, 150,000 units were started in Department A and 160,000 units were completed and transferred to Department B. WIP on March 31 was 100% complete as to material costs and 50% complete as to conversion costs. By what amount would the equivalent units for conversion costs for the month of March differ if the FIFO method were used instead of the weighted-average method?

1. 10,000
2. 8,000 decrease
3. 6,000 decrease
4. 5,000 decrease
5. 4,000 decrease

10 . Given a competitive outside market for identical intermediate goods, what is the best transfer price, assuming all relevant information is readily available?

a. Average cost of production.
b. Average cost of production, plus average production department allocated profit.
c. Market price of the intermediate goods.
d. Market price of the intermediate goods, less average production department allocated profit.

11. If a firm is following the cost leadership strategy, and overhead accounts are complex, then the:

1. firm should use a process costing system.
2. firm can use either a process or job costing system.
3. traditional volume-based job costing will not provide much help.
4. only recourse is to install a hybrid costing system.
5. firm should attempt to collect only material and labor costs.

12. The concept of "management by exception" refers to management's consideration of:

1. only those items that vary materially from plans.
2. only rare and unusual events.
3. items selected at random.
4. only those items that vary materially from the operations of the previous year.
5. only those items deemed to be exceptionally important.

Any idea which one is the answer?

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Solution Summary

The solution provides a number of multiple choice questions with explanations for business management, process costing, and direct costing.

See Also This Related BrainMass Solution

10 Multiple Choice Questions-Business Management -Author, Robert N. Lussier

Business Management
Author, Robert N. Lussier

1. Behavioral theorist
a. are similar to systems and classical theorists in the way they conceptualize the organization and its problems.
b. Break the organization into its component parts to understand the whole
c. Look at the organization as a whole to understand the interrelationship of its parts
d. All of the above

2. The systems theorist and the contingency theorists both believe
a. people are the se4cret to good management
b. there is no "one best way" to manage
c. there is "one best way" to manage
d. they don't agree on anything

3. Reflexive decision makers often fail to sufficiently
a. define the problem
b. set objectives and criteria
c. generate alternatives
d. analyze and select alternatives
e. plan and implement the decision

4. A manufacturer that begins producing its own components exemplifies
a. concentration
b. forward integration
c. backward integration
d. related diversification
e. unrelated diversification

5. Which of the following is a scheduling technique?
a. planning sheet
b. gantt
d. All of the above

6. One disadvantage of using _________ tis the "ripple effect."
a. internal sources
b. external sources
c. both of the above
d. none of the above

7. Middle-of-the-road management is a style involved in
a. two-dimmensional leadership theory
b. leadership grid
c. both of the above
d. none of the above

8. Both the leadership continuum model and the path-goal leadership model
a. are based on objective data
b. help determine if a person's leadership style matches a particular situation
c. are base on subjective data
d. none of the above

9. Concurrent control is a(n)
a. formal evaluative application of performance appraisal
b. formal developmental application of performance appraisal]
c. informal application of performance appraisal
d. none of the above

10. Normally, stockholders are most interested in the ____________.
a. income statement
b. balance sheet
c. cash flow statement
d. all of the above
e. none of the above

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