Part one.

a process costing system, when raw materials are put into process, the cost of the items is moved from:

Work in Process to Finished Goods.

Finished Goods to Cost of Goods Sold.

Raw Materials to Work in Process.

Finished Goods to Work in Process.

2. Ending inventory in the assembly department consists of 700 units which are 50% complete with respect to conversion costs. The beginning inventory consisted of 2,000 units. During the month, 6,000 units were started. How many equivalent units will be used in the cost per equivalent unit calculation for conversion costs?

7,650

7,300

8,000

6,700

3. When partially completed units are converted to a comparable number of completed units, they are referred to as (Points : 2)

converted units.

split-off units.

equivalent units.

equitable units.

4. The number of equivalent units in Work in Process is the same for materials and conversion costs.

True

False

5. A company such as Kimberly - Clark, which produces large quantities of identical items like disposable diapers and facial tissues, is likely to use a job-order costing system.

True

False

6. The ending Work in Process inventory in the mixing department contains 300 units that are 30% complete with respect to labor costs. How many equivalent units are in the ending inventory?

300

70

210

90

7. Ranger Glass Company manufactures glass for French doors. At the start of May, 2,000 units were in-process. During May, 11,000 units were completed and 3,000 units were in process at the end of May. These in-process units were 90% complete with respect to material and 50% complete with respect to conversion costs. Other information is as follows:

How much is the cost per equivalent unit for direct materials?

$24.00

$16.20

$15.86

$13.58

8. Which of the following components of work in process are always 100% complete t the beginning of the processing in a department?

Direct labor

Manufacturing overhead

Transferred-in costs

Direct material

9. Department Alpha had no beginning inventory. The department added direct materials of $100,000 and conversion costs of $150,000 during the month of July. Materials are added at the beginning of the process and conversion costs are added evenly throughout the process in this department. During the period, 40,000 units were completed. At the end of the period 40,000 units remained which were 10% complete. What is the cost per equivalent unit of materials and conversion costs, respectively in July?

$3.41 and 4.66

$1.25 and $3.41

$1.25 and $1.88

$1.88 and $3.41

10. The Nazareth Company's mixing department incurred conversions costs of $650,820 during January, after recording a beginning Work in Process inventory of $30,430 for conversion costs. Fifty-four thousand units were transferred out of the department and the ending inventory consisted of 2,500 units that are 20% complete with respect to conversion. What is the conversion cost per equivalent unit?

$12.50

$12.05

$12.17

$12.62

Section 2.

PART ONE

Question 1 (25 marks):

The goal of accounting is to provide useful information for decisions.Therefore, financial accounting is governed by concepts and rules known as generally accepted accounting principles (GAAP).

Explain that sentence showing the qualitative characterstics of usefull information. [10 marks].

b) Discuss the main roles of International Accounting Standards Board (IASB) including its efforts with Financial Accounting Standard Board (FASB) to achieve a single set of accounting standards for global use. [15 marks].

Question 2 (25 marks)

A Choose the correct answer for the following items. (20 marks= 2 mark each)

1) Which of the following financial statements lists the entity's assets, liabilities, and stockholders' equity as of a specific date?

A) Statement of cash flows

B) Statement of retained earnings

C) Income statement

D) Balance sheet

2) Which of the following sequences is the normal sequence of flow of accounting data?

A) Ledger ? Journal ? Source document

B) Journal ? Source document ? Ledger

C) Source document ? Journal ? Ledger

D) Source document ? Ledger ? Journal

3) The field of accounting that focuses on providing information for external decision makers is ________.

A) managerial accounting

B) financial accounting

C) cost accounting

D) nonmonetary accounting

4) Which of the following is the record holding all the accounts, the changes in those accounts, and their balances?

A) Ledger

B) Journal

C) Source document

D) Trial balance

5) Luna Rashed decided to start her own CPA practice as a professional corporation, Rashid CPA PC. Her corporation purchased an office building for $35,000 that her real estate agent said was worth $50,000 in the current market. The corporation recorded the building as a $50,000 asset because Luna believes that is the real value of the building. Which of the following concepts or principles of accounting is being violated?

A) cost principle

B) economic entity assumption

C) monetary unit assumption

D) going concern assumption

6) Which of the following statements is true of a trial balance?

A) A trial balance is the first step in the accounting cycle.

B) A trial balance is also known as a balance sheet.

C) A trial balance is a list of all accounts with their balances.

D) A trial balance is also known as the chart of accounts.

7) Sunlight Company has assets and equity that amount to $200,000 and $90,000, respectively. Liabilities total ________.

A) $90,000

B) $110,000

C) $200,000

D) $290,000

8) GCC Co. reported assets of $1,000 and equity of $450. What is its debt ratio?

A) 60%

B) 45%

C) 100%

D) 55%

9) Future, Inc. paid $12,000 on accounts payable. How does this transaction affect the accounting equation of Future, Inc.?

A) assets decrease by $12,000 and equity increases by $12,000

B) assets decrease by $12,000 and liabilities decrease by $12,000

C) assets increase by $12,000 and equity decreases by $12,000

D) assets increase by $12,000 and liabilities increase by $12,000

10) The Accounts Payable account of Nadeen, Inc. has the following postings:

Calculate the ending balance of the account.

A) $18,000 credit

B) $5,000 debit

C) $12,000 credit

D) $18,000 debit

B- Identify whether the following items would be reported on the income statement (IS) or statement of financial position (FP). (5 marks)

1.Service Revenue

2.Cash

3.Interest Expense

4.Notes Payable

5.Salaries Expenses.

ii.

Review the following information for Kayaks-for-Fun (KFF): River Sea of Selling price $500 $600 Variable cost 100 450 Contribution margin $400 5150 Table taken from Managerial Accounting, v. 1.0:"Chapter 6, Section 5: Using a Contribution Margin When Faced with Resource Constraints" Kayaks-for-Fun makes two types of kayaks: a river model and a sea model. KFF has a total of 320 skilled labor hours available each month. Assume the river model requires four labor hours per unit and the sea model requires one labor hour per unit. How should KFF use its constrained labor supply and why? Select one: a. Kayaks-for-Fun should only sell the sea model because it provides a contribution margin per labor hour of $100, which would yield a total contribution margin of $32,000. b. Kayaks-for-Fun should only sell the river model because it provides a contribution margin per labor hour of $100, which would vield a total contribution margin of $32.000.on 16 How will Al's Wooden Turnings close its manufacturing overhead account when there is a material balance of $2,000 in under-applied red overhead? Its three account balances are: d out of Accounts Amount Work-in-process inventory $6,000 on Finished goods inventory $3.000 Cost of goods sold $1:000 Total $10,000 Select one: O a. Allocate $0 to WIP, $0 to finished goods, and $2000 to cost of goods sold. O b. Allocate $2,000 to WIP, $0 to finished goods, and $0 to cost of goods sold. c. Allocate $200 to WIP, $600 to finished goods, and $1200 to cost of goods sold. O d. Allocate $1,200 to WIP, $600 to finished goods, and $200 to cost of goods sold.Computing Basic and Diluted EPS, Convertible Bonds, Options, Convertible Preferred Stock. Antidilution, Disclosures. Merion Company provided the following share information for the current year. Event and Date Number of Shares 1/1 Beginning balance 150,000. 6/1 New share issue 240,000 8/1 Two-for-one stock split 10/1 New share issue 390,000 12/1 Treasury stock acquisition (48,000) Merion reported income from-continuing operations of $1,000,000 and a $430,090 loss from-discontinued operations, net of tax. The company is subject to a 40% tax rate. NI = $'5 70.00 The company granted 120,000 employee options on January 1 allowing employees to acquire 120,000 common shares at $18 per share. The options have an estimated fair value of $10 per share. The average tarket price of the company's common shares is $24 per share. Merion has $500,000, 6% convertible ebt outstanding as of the beginning of the year. Each $1,000 par value bond converts into eight shares of the company's common stock. Merion also has $140,000 par value, 4% convertible preferred shares outstanding for the current year. The board of directors declared the annual dividend. The preferred shares can convert into 10,000 shares of common stock. There were no actual exercises or conversions during the year. Required > a. Compute the weighted-average number of common shares outstanding for basic earnings per share. b. Determine whether any securities are antidilutive and compute basic and diluted earnings per share. Show all computations