Question : 11.Orlando Company paid $100 cash to purchase production supplies. How : 1257039

 

 

11.Orlando Company paid $100 cash to purchase production supplies. How does this transaction affect the financial statements?     

A. 

 

 

B. 

 

 

C. 

 

 

D. 

 

 

 

12.Purchasing production supplies for cash is a(n):   

A. asset source transaction.

 

B. asset exchange transaction.

 

C. asset use transaction.

 

D. claims exchange transaction.

 

 

13.Paying for factory utilities is a(n):   

A. asset exchange transaction.

 

B. asset use transaction.

 

C. asset source transaction.

 

D. claims exchange transaction.

 

 

14.Orlando Company paid $700 cash for production workers’ wages. How does this transaction affect the financial statements?     

A. 

 

 

B. 

 

 

C. 

 

 

D. 

 

 

 

15.Purchasing raw materials on account is a(n):   

A. asset source transaction.

 

B. asset use transaction.

 

C. asset exchange transaction.

 

D. claims exchange transaction.

 

 

16.Which of the following statements is false?   

A. Under variable costing, the income statement is prepared using a contribution margin approach.

 

B. Variable costing is not allowed for external financial reporting, but many companies find it useful for internal managerial reports.

 

C. Under variable costing, an increase in production increases the amount of profit reported on the income statement, even if the additional units are not sold.

 

D. Under variable costing, fixed manufacturing costs are expensed in the period incurred.

 

 

17.Fortune Company had beginning raw materials inventory of $16,000. During the period, the company purchased $92,000 of raw materials on account. If the ending balance in raw materials was $10,000, the amount of raw materials transferred to work in process inventory is:   

A. $86,000.

 

B. $98,000.

 

C. $102,000.

 

D. $92,000.

 

 

18.A credit to the raw materials account represents:   

A. raw materials added to production.

 

B. raw materials purchased.

 

C. raw materials available for use.

 

D. none of these.

 

 

19.Frost Corporation was started on January 1, 2014. The company incurred the following transactions during the year (Assume all transactions involve cash):1) Acquired $1,000 of capital from the owners.2) Purchased $300 of direct raw materials.3) Used $100 of these direct raw materials in the production process.4) Paid production workers $400 cash.5) Paid $200 for manufacturing overhead (applied and actual overhead are the same).6) Started and completed 200 units of inventory.7) Sold 50 units at a price of $6 each.8) Paid $40 for selling and administrative expenses.The amount of raw material inventory on the balance sheet at the end of the accounting period would be:   

A. $100.

 

B. $200.

 

C. $300.

 

D. $0.

 

 

20.Recognizing estimated manufacturing overhead costs at the end of a month is a(n):   

A. asset source transaction.

 

B. asset use transaction.

 

C. asset exchange transaction.

 

D. claims exchange transaction.