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Handout 1.0 ACC 123 Practice Problems For Cost Concepts and Cost Behavior

This document provides practice problems for cost concepts and cost behavior from ACC 123 - Cost Accounting and Control. It contains 11 multiple choice questions covering topics like calculating manufacturing overhead, cost of goods sold, inventory amounts, and cost formulas using different methods. The instructor is Leenuel M. Bernarte, CPA.

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Francine Thea M. Lantaya
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270 views2 pages

Handout 1.0 ACC 123 Practice Problems For Cost Concepts and Cost Behavior

This document provides practice problems for cost concepts and cost behavior from ACC 123 - Cost Accounting and Control. It contains 11 multiple choice questions covering topics like calculating manufacturing overhead, cost of goods sold, inventory amounts, and cost formulas using different methods. The instructor is Leenuel M. Bernarte, CPA.

Uploaded by

Francine Thea M. Lantaya
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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ACC 123 – Cost Accounting and Control – Handout 1.

0
Topic: Practice Problems for Cost Concepts and Cost Behavior
Instructor: Leenuel M. Bernarte, CPA

COST CONCEPTS
1. A Company’s manufacturing overhead is 20% of its total conversion costs. If direct labor is P38,000 and if direct materials
is P47,000, the manufacturing overhead is:
A. P152,000 B. P11,750 C. P21,250 D. P9,500

2. During the month of July, direct labor cost totaled P12,000 and direct labor cost was 30% of prime cost. If total
manufacturing costs during July were P86,000, the manufacturing overhead was:
A. P46,000 B. P40,000 C. P28,000 D. P74,000

3. Consider the following costs:


Direct materials P 33,000
Depreciation on factory equipment 12,000
Factory janitor’s salary 23,000
Direct labor 28,000
Utilities for factory 9,000
Selling expenses 16,000
Production supervisor’s salary 34,000
Administrative expenses 21,000
What is the total amount of manufacturing overhead included above?
A. P78,000 B. P139,000 C. P44,000 D. P37,000

4. Using the following data for a recent period, calculate the beginning finished goods:
Sales P 40,000
Beginning finished goods inventory ?
Cost of goods manufactured 16,000
Ending finished goods inventory 5,000
Cost of goods sold ?
Gross margin 17,000
Administrative and selling expenses ?
Net operating income 10,000
The beginning finished goods inventory was:
A. P24,000 B. P23,000 C. P7,000 D. P12,000

5. The cost of goods manufactured for October T Manufacturing Corporation was P907,000. The following changes occurred
in T inventory accounts during October:
Decreases in raw materials inventory P 24,000
Decrease in raw process inventory 17,000
Increase in finished goods inventory 38,000
What was T’s cost of goods sold for October?
A. P869,000 B. P886,000 C. P928,000 D. P945,000

For items 6-8.


The following data pertain to G Company’s operations in May:
May 1 May 31
Work in process inventory P 7,000 P 12,000
Raw materials inventory 15,000 ?
Finished goods inventory ? 20,000
Other data:
Raw materials used 40,000
Sales 200,000
Cost of goods manufactured 135,000
Manufacturing overhead costs 60,000
Raw material purchases 30,000
Gross margin 60,000

6. The ending materials inventory was:


A. P5,000 B. P10,000 C. P15,000 D. P20,000

7. The beginning finished goods inventory was:


A. P5,000 B. P15,000 C. P25,000 D. P30,000

8. The direct labor cost for May was:


A. P35,000 B. P40,000 C. P30,000 D. P25,000

ACC 123-Bernarte-Cost-Concepts-Behavior
For items 9-11.
As part of a cost study, the cost accountant of MANAMA Corporation has recorded the cost of operations at seven different
levels of material usage. The records show the following:
Kilos of Cost of
Materials Operation
80 P 800
60 480
20 320
120 1,200
140 1,280
40 480
100 1,040

9. Using the high and low points method, the cost formula may be expressed as:
A. Total cost = 320 + 16x
B. Total cost = 103 + 8.71x
C. Total cost = 160 + 8x
D. Total cost = 206 + 10x

10. Under the method of least squares, the cost formula is expressed as:
A. Total cost = 320 + 16x
B. Total cost = 103 + 8.71x
C. Total cost = 160 + 8x
D. Total cost = 206 + 10x

11. Then project cost of the operations for 90 kilos of materials is:
A. P886.90 if the high-low method is used
B. P880.00 if the method of least squares is used
C. P886.90 of the method of least squares is used
D. P880.00 regardless of the methods used

---END OF HANDOUTS---

ACC 123-Bernarte-Cost-Concepts-Behavior

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