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Understanding Manufacturing Accounts

Authored by Sadhoo Green

Other

10th Grade

Used 1+ times

Understanding Manufacturing Accounts
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15 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is the formula for calculating Cost of Goods Sold?

COGS = Beginning Inventory + Ending Inventory

COGS = Beginning Inventory + Purchases - Ending Inventory

COGS = Beginning Inventory - Purchases + Ending Inventory

COGS = Purchases - Ending Inventory

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Define Direct Materials Used in manufacturing.

Direct materials used are the raw materials that can be directly attributed to the production of finished goods.

Direct materials are the finished goods ready for sale.

Direct materials are the overhead costs incurred during manufacturing.

Direct materials are the labor costs associated with production.

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

How do you calculate Direct Labor Costs?

Direct Labor Costs = Sum of (Hourly Wage x Total Hours Worked) for all employees.

Direct Labor Costs = Total Revenue - Fixed Costs.

Direct Labor Costs = Total Expenses / Total Hours Worked.

Direct Labor Costs = Average Salary x Number of Employees.

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is included in Manufacturing Overhead?

Direct materials costs

Administrative salaries

Sales and marketing expenses

Manufacturing overhead includes indirect costs like factory rent, utilities, depreciation, indirect labor, and indirect materials.

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Explain how Gross Profit is calculated.

Gross Profit = Total Revenue - Cost of Goods Sold (COGS)

Gross Profit = Cost of Goods Sold - Total Revenue

Gross Profit = Total Revenue - Operating Expenses

Gross Profit = Total Revenue + Cost of Goods Sold (COGS)

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What are the different Inventory Valuation Methods?

Specific Identification

Standard Costing

Last In, First Out (LIFO)

FIFO, LIFO, Weighted Average Cost

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

How does the FIFO method affect inventory valuation?

FIFO results in lower cost of goods sold and higher inventory valuation during inflation.

FIFO results in equal cost of goods sold and inventory valuation in all economic conditions.

FIFO has no impact on inventory valuation regardless of inflation.

FIFO leads to higher cost of goods sold and lower inventory valuation during inflation.

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