ACCT 211 MIDTERM FALL 2014 Please show all calculations for full credit and to allow for partial credit. 1. Describe 3 differences between financial and managerial accounting. 2. Managerial accountants must follow a code of conduct. Why? 3. In the Managerial Accountant’s Code of Conduct there are 4 areas: competence, confidentiality, integrity, and credibility/objectivity. Describe one of these areas. 4. What is the difference between period costs and product costs? 5. What is the difference between fixed and variable costs? 6. Please classify the following as either a period or product cost AND either a fixed or variable cost. Period Product Fixed Variable a. plastic components to make a toy b. administrative building rent c. accountant’s salary d. line workers wages e. electricity for conveyor belt f. property taxes (manufacturing facility) 7. Product costs (manufacturing costs) are made up of 3 components or types of costs. List all 3. 8. All other expenses are classified as non-manufacturing expenses or period costs. List one type of non-manufacturing expense/ period cost. 9. What is the difference between a direct and indirect cost? 10. A __________ cost is a cost that has already been incurred and that cannot be changed by any decision made now or in the future. 11. Depending on the product being manufactured, companies use either a process or job-order costing system. Please determine which type of costing system that the following companies would use: Process Job-Order a. Coca-Cola bottling soda b. A paper mill c. An advertising agency d. A paper clip manufacturer e. Boeing making a jet f. An auto repair shop The following data has been taken from the accounting records of Chase Corporation for the year ended 2014: Sales $930,000 Raw materials inventory, beginning $70,000 Raw materials inventory, ending $40,000 Raw materials, purchases $190,000 Direct labor $150,000 Manufacturing overhead $210,000 Administrative expenses $95,000 Selling expenses $120,000 Work in process inventory, beginning $80,000 Work in process inventory, ending $75,000 Finished goods inventory, beginning $90,000 Finished goods inventory, ending $140,000 Use the data to answer the following questions (12 – 14) 12. What was the cost of the raw materials used in production during the year? 13. What was the cost of goods manufactured (finished) for the year? 14. What was the cost of goods sold for the year? 15. Please classify the following accounts where they would be found - on the Balance Sheet (asset) or on the Income statement (expense): Balance sheet Income statement a. raw materials inventory b. administrative expenses c. work in process inventory d. finished goods inventory e. cost of goods sold f. selling expenses 16. During December, $64,000 in raw materials were requisitioned from the storeroom for use in production. These raw materials included $51,000 of direct and $13,000.

1. ACCT 211
MIDTERM
FALL 2014
Please show all calculations for full credit and to allow for
partial credit.
1. Describe 3 differences between financial and managerial
accounting.
2. Managerial accountants must follow a code of conduct.
Why?
3. In the Managerial Accountant’s Code of Conduct there are 4
areas: competence, confidentiality, integrity, and
credibility/objectivity. Describe one of these areas.
4. What is the difference between period costs and product
costs?
5. What is the difference between fixed and variable costs?
6. Please classify the following as either a period or product
cost AND either a fixed or variable cost.
Period Product
Fixed
Variable
a. plastic components to make a toy
b. administrative building rent
c. accountant’s salary
d. line workers wages
e. electricity for conveyor belt
f. property taxes (manufacturing facility)
7. Product costs (manufacturing costs) are made up of 3

2. components or types of costs. List all 3.
8. All other expenses are classified as non-manufacturing
expenses or period costs. List one type of non-manufacturing
expense/ period cost.
9. What is the difference between a direct and indirect cost?
10. A __________ cost is a cost that has already been incurred
and that cannot be changed by any decision made now or in the
future.
11. Depending on the product being manufactured, companies
use either a process or job-order costing system. Please
determine which type of costing system that the following
companies would use:
Process
Job-Order
a. Coca-Cola bottling soda
b. A paper mill
c. An advertising agency
d. A paper clip manufacturer
e. Boeing making a jet
f. An auto repair shop
The following data has been taken from the accounting records
of Chase Corporation for the year ended 2014:
Sales

3. $930,000
Raw materials inventory, beginning
$70,000
Raw materials inventory, ending
$40,000
Raw materials, purchases
$190,000
Direct labor
$150,000
Manufacturing overhead
$210,000
Administrative expenses
$95,000
Selling expenses
$120,000
Work in process inventory, beginning
$80,000
Work in process inventory, ending

4. $75,000
Finished goods inventory, beginning
$90,000
Finished goods inventory, ending
$140,000
Use the data to answer the following questions (12 – 14)
12. What was the cost of the raw materials used in production
during the year?
13. What was the cost of goods manufactured (finished) for the
year?
14. What was the cost of goods sold for the year?
15. Please classify the following accounts where they would be
found - on the Balance Sheet (asset) or on the Income
statement (expense):
Balance sheet
Income statement
a. raw materials inventory
b. administrative expenses
c. work in process inventory
d. finished goods inventory
e. cost of goods sold
f. selling expenses
16. During December, $64,000 in raw materials were
requisitioned from the storeroom for use in production. These

5. raw materials included $51,000 of direct and $13,000 of indirect
materials. What is the journal entry to record this transaction?
Mattie Corporation, which applies manufacturing overhead on
the basis of machine-hours, has provided the following data for
its year 2013 operations:
Estimated manufacturing overhead
$239,500
Estimated machine-hours
4,500
Actual manufacturing overhead
$241,900
Actual machine hours
5,500
Use the data to answer the following questions (17-20).
17. The predetermined overhead rate would be:
18. The applied manufacturing overhead for the year is:
19. Was the overhead for the year over applied or under
applied? By how much?
20. When the difference in overhead is closed out to cost of
goods sold (COGS), will it increase COGS or decrease COGS?
What is the effect on final net income?
21. Why are predetermined overhead rates calculated and used
to estimate manufacturing overhead instead of using actual
overhead amounts?
22. ____________ costs increase as the total amount produced

6. increases, but remain constant per unit.
23. ___________ costs remain constant in total, but decrease
per unit as more units are produced.
24. What is the difference between committed fixed costs and
discretionary fixed costs?
25. At Maryville hospital the total cost for 7300 patient days is
$9,100. The total fixed costs associated with this level are
$3,300.
a. Compute the total variable cost.
b. What is the variable cost per patient day?
c. Put the fixed and variable cost in the mixed cost equation
format.
26. The Maui Hotel in Hawaii has accumulated records of
operating costs as follows:
occupancy
electrical
days
costs
Jan
2736
$6,127
Feb
2904
$6,207
Mar
2356

7. $6,083
Apr
2560
$6,857
May
3160
$8,871
June
2544
$6,696
July
2708
$7,670
Aug
1406
$5,148
Sept
2840
$5,691
Oct
2124
$5,588
Nov
2320
$5,454
Dec
2364
$5,529
Using the high-low method, estimate the fixed cost of
electricity per month AND the variable cost of electricity per
occupancy day.
27. Bruiser products has a single product whose selling price is
$55 per unit and whose variable cost is $22 per unit. Total
monthly fixed expenses are $8,700.

8. a. Solve for the break-even point in units.
b. Solve for the break-even point in sales dollars using the
Contribution Margin ratio.
28. Review the following graph:
Label the break-even point, the profit area, and the loss area (or
if filling out electronically, describe where these areas would
be).
29. DVB Corporation has a single product whose selling price is
$130 per unit and whose variable cost is $75 per unit. Monthly
fixed costs are $60,000.
Using the equation or formula method, solve for unit sales
required to earn a target profit of $10,000.
30. Compute the margin of safety (total sales – breakeven sales)
using the following data:
selling price
$35 per unit
variable cost
$25 per unit
fixed expenses
$8,000 per month
Total unit sales
2,500 units per month
31. Job 827 was recently completed. The following data have
been recorded on its job cost sheet:
Direct materials
$61,050
Direct labor hours

9. 1,332 labor hours
Direct labor wage rate
$14 per labor-hour
Machine Hours
1,480 machine hours
Number of units completed
3,700 units
The company applies manufacturing overhead on the basis of
machine-hours. The predetermined overhead rate is $13 per
machine-hour.
Compute the unit product cost that would appear on the job cost
sheet for this job.
32. Describe a difference between traditional cost systems and
ABC cost systems.
33. Match the activities to the appropriate level they are
grouped in:
1. processing purchase orders
2. design new products
3. hire a new employee
4. process a unit in the manufacturing process
a. organization sustaining
b. unit level
c. product level
d. batch level
34. Apex’s ABC activity information is as follows:

10. total cost
total activity
activity rate
customer orders
315,000
1000 orders
product design
257,000
200 designs
order size
380,000
20000 machine hours
customer relations
367,500
100 customers
other
490,500
n/a
Compute the activity rate for all applicable activities above.
35. Apex manufactures 2 models of sailboats, the standard and
the deluxe.
standard boat
activity rate

11. activity
ABC cost allocation
customer order
2 orders
product design
0 designs
order size
200 machine hours
customer relations
n/a
deluxe boat
activity

12. customer order
1 orders
product design
1 designs
order size
100 machine hours
customer relations
n/a
Use the activity rate from above in #34 in the activity rate
column. Compute the ABC cost allocation above.