ACC 406 Quiz Bank | All Possible Questions and
Answers | 2025 Update|100% Correct-Toronto
Metropolitan University
1.
Information:
• On May 1, BlueDenim had $68,000 of materials in inventory.
• During the month of May, the company purchased $210,000 of materials.
• On May 31, materials inventory equalled $22,000.
Required:
Calculate the direct materials used in production for the month of May.
Beginning materials inventory + Purchases ‒ Ending materials inventory = Materials used
in production
$68,000 + $210,000 ‒ $22,000 = $256,000
2.
Information:
• During the month of May, the company purchased $210,000 of materials.
• On May 31, materials inventory equalled $22,000.
• During the month of May, BlueDenim Company incurred
• direct labour cost of $135,000
• manufacturing overhead of $150,000
Inventory information:
May 1 May 31
Materials $68,000 $22,000
Work in process 50,000 16,000
Required:
1. Calculate the cost of goods manufactured for May.
2. Calculate the cost of one pair of jeans, assuming 115,000 pairs of jeans were completed
during May.
1.
Direct materials $256,000
Direct labour 135,000
Manufacturing overhead 150,000
, Total manufacturing cost $541,000
Work in process, May 1 50,000
Work in process, May 31 (16,000)
Cost of goods manufactured $575,000
2. COGM of May
COGM per Unit = COGM = $575,000 = $5 per unit
# of Units 115,000 units
3.
Information:
• On May 1, BlueDenim Company had 10,000 units in finished goods inventory costing $50,000.
• On May 31, the company had 26,000 units in finished goods inventory costing $130,000.
Required:
1. Calculate the cost of goods sold for May.
2. Calculate the number of pairs of jeans sold during May.
1.
COGM $575,000
Finished goods, May 1 50,000
Finished goods, May 31 (130,000) (Reported as an asset on the
balance sheet)
COGS $495,000 (Reported as an expense on
the income statement)
2. Numbers of units sold:
Finished goods, May 1 10,000
Units finished during May 115,000
Finished goods inventory, May 31 (26,000)
Units sold during May 99,000
4.
Information:
• BlueDenim Company sold 99,000 pairs of jeans in May at a total cost of $495,000.
• Each pair sold at a price of $8.
• BlueDenim also incurred
, • commissions equal to 10% of the sales price
• other selling expenses of $120,000
• administrative expenses of $85,000
Required:
Prepare a May income statement for BlueDenim.
, Sales revenue $792,000 (99,000 pairs of jeans x $8)
Cost of goods sold 495,000
Gross margin $297,000
Less:
Selling expense: ($792,000 x 10%)
Commissions $ 79,200
Fixed selling expense 120,000 199,200
Administrative expense 85,000
Operating income $ 12,800
5.
Information:
BlueDenim Company’s income statement for the month of May was shown in Cornerstone 2.4.
Required:
Calculate the percentage of sales revenue represented by each line of the income statement.
Sales revenue $792,000 100.0%
COGS 495,000 62.5%
Gross margin $297,000 37.5%
Less:
Selling expense:
Commissions $79,200
Fixed selling 120,000 199,200 25.2%
expense
Administrative 85,000 10.7%
expense
Operating income $12,800 1.6%
6.
Information:
• Komala Information Systems designs and installs software.
• Last month, Komala had costs of
• software licensing , $5,000
• service technicians, $35,000
• research and development, $55,000
• selling expenses, $5,000
• administrative expenses, $7,000
Answers | 2025 Update|100% Correct-Toronto
Metropolitan University
1.
Information:
• On May 1, BlueDenim had $68,000 of materials in inventory.
• During the month of May, the company purchased $210,000 of materials.
• On May 31, materials inventory equalled $22,000.
Required:
Calculate the direct materials used in production for the month of May.
Beginning materials inventory + Purchases ‒ Ending materials inventory = Materials used
in production
$68,000 + $210,000 ‒ $22,000 = $256,000
2.
Information:
• During the month of May, the company purchased $210,000 of materials.
• On May 31, materials inventory equalled $22,000.
• During the month of May, BlueDenim Company incurred
• direct labour cost of $135,000
• manufacturing overhead of $150,000
Inventory information:
May 1 May 31
Materials $68,000 $22,000
Work in process 50,000 16,000
Required:
1. Calculate the cost of goods manufactured for May.
2. Calculate the cost of one pair of jeans, assuming 115,000 pairs of jeans were completed
during May.
1.
Direct materials $256,000
Direct labour 135,000
Manufacturing overhead 150,000
, Total manufacturing cost $541,000
Work in process, May 1 50,000
Work in process, May 31 (16,000)
Cost of goods manufactured $575,000
2. COGM of May
COGM per Unit = COGM = $575,000 = $5 per unit
# of Units 115,000 units
3.
Information:
• On May 1, BlueDenim Company had 10,000 units in finished goods inventory costing $50,000.
• On May 31, the company had 26,000 units in finished goods inventory costing $130,000.
Required:
1. Calculate the cost of goods sold for May.
2. Calculate the number of pairs of jeans sold during May.
1.
COGM $575,000
Finished goods, May 1 50,000
Finished goods, May 31 (130,000) (Reported as an asset on the
balance sheet)
COGS $495,000 (Reported as an expense on
the income statement)
2. Numbers of units sold:
Finished goods, May 1 10,000
Units finished during May 115,000
Finished goods inventory, May 31 (26,000)
Units sold during May 99,000
4.
Information:
• BlueDenim Company sold 99,000 pairs of jeans in May at a total cost of $495,000.
• Each pair sold at a price of $8.
• BlueDenim also incurred
, • commissions equal to 10% of the sales price
• other selling expenses of $120,000
• administrative expenses of $85,000
Required:
Prepare a May income statement for BlueDenim.
, Sales revenue $792,000 (99,000 pairs of jeans x $8)
Cost of goods sold 495,000
Gross margin $297,000
Less:
Selling expense: ($792,000 x 10%)
Commissions $ 79,200
Fixed selling expense 120,000 199,200
Administrative expense 85,000
Operating income $ 12,800
5.
Information:
BlueDenim Company’s income statement for the month of May was shown in Cornerstone 2.4.
Required:
Calculate the percentage of sales revenue represented by each line of the income statement.
Sales revenue $792,000 100.0%
COGS 495,000 62.5%
Gross margin $297,000 37.5%
Less:
Selling expense:
Commissions $79,200
Fixed selling 120,000 199,200 25.2%
expense
Administrative 85,000 10.7%
expense
Operating income $12,800 1.6%
6.
Information:
• Komala Information Systems designs and installs software.
• Last month, Komala had costs of
• software licensing , $5,000
• service technicians, $35,000
• research and development, $55,000
• selling expenses, $5,000
• administrative expenses, $7,000
