ACCT 526 MIDTERM EXAM STUDY GUIDE 2026
QUESTIONS WITH SOLUTIONS GRADED A+
◉ Indirect Labor. Answer: Work of factory employees that has no
physical association with the finished product, or it is impractical to
trace the costs to the good produced.
◉ Product Costs. Answer: costs that are a necessary and integral
part of producing the finished product
◉ Manufacturing Overhead. Answer: Manufacturing costs that are
indirectly associated with the manufacture of the finished product.
◉ Managerial Accounting. Answer: A field of accounting that
provides economic and financial information for internal users.
◉ Direct Labor. Answer: The work of factory employees that can be
physically and directly associated with converting raw materials into
finished goods.
◉ Manufacturing Overhead. Answer: Identify: Factory supervisor's
salary
,◉ Period Costs. Answer: Identify: Supplies for the general office
◉ Direct Materials. Answer: Identify: Rubber latex purchased for the
use in the manufacture of automobile tires
◉ Period Costs. Answer: Identify: Advertising
◉ Manufacturing Overhead. Answer: Identify: Rent on factory
equipment
◉ Period Costs. Answer: Identify: Utility cost for the store
◉ Period Costs. Answer: Identify: Salary paid to the company's chief
executive officer
◉ Manufacturing Overhead. Answer: Identify: Salary paid to
mechanics who maintain and repair factory equipment
◉ Direct Labor. Answer: Identify: Wages paid to assembly-line
workers who install interiors in automobiles
◉ a. deal with the economic events of an enterprise. Answer:
Financial and managerial accounting are similar in that both:
,a. deal with the economic events of an enterprise.
b. produce general-purpose reports.
c. have the same primary users.
d. have reports that are prepared quarterly and annually.
◉ c. the product is sold. Answer: Product costs are expenses on the
income statement when:
a. the product completes the manufacturing process.
b. the order is received for the product.
c. the product is sold.
d. raw materials for the product are purchased.
◉ a. $22,500
15,500 + 44,500 - 37,500 =. Answer: Super Tread Inc. is a large
manufacturer of auto tires. Super Tread has provided the following
information:
Sales Revenue $55,000
Beginning Finished Goods Inventory $15,500
Cost of Goods sold $37,500
Cost of Goods Manufactured $44,500
, Calculate the amount of ending Finished Goods Inventory reported
on Super Tread's balance sheet.
◉ c. $1,135,000
Direct Materials (81,000+360,000-59,000) + Direct Labor (471,000)
+ Factory Overhead (19,000+24,000+268,000) + Work-in-Process
(26,000-55,000). Answer: Payton Corporation provided the
following information for the year:
Beginning Balance - Work-in-Process Inventory $26,000
Ending Balance - Work-in-Process Inventory $55,000
Beginning Balance - Direct Materials 81,000
Ending Balance - Direct Materials 59,000
Purchases - Direct Materials 360,000
Direct Labor 471,000
Indirect Labor 19,000
Depreciation on Factory Plant and Equipment 24,000
Plant Utilities and Insurance 268,000
What was the amount of the cost of goods manufactured for the
year?
a. $1,363,000
b. $1,193,000
QUESTIONS WITH SOLUTIONS GRADED A+
◉ Indirect Labor. Answer: Work of factory employees that has no
physical association with the finished product, or it is impractical to
trace the costs to the good produced.
◉ Product Costs. Answer: costs that are a necessary and integral
part of producing the finished product
◉ Manufacturing Overhead. Answer: Manufacturing costs that are
indirectly associated with the manufacture of the finished product.
◉ Managerial Accounting. Answer: A field of accounting that
provides economic and financial information for internal users.
◉ Direct Labor. Answer: The work of factory employees that can be
physically and directly associated with converting raw materials into
finished goods.
◉ Manufacturing Overhead. Answer: Identify: Factory supervisor's
salary
,◉ Period Costs. Answer: Identify: Supplies for the general office
◉ Direct Materials. Answer: Identify: Rubber latex purchased for the
use in the manufacture of automobile tires
◉ Period Costs. Answer: Identify: Advertising
◉ Manufacturing Overhead. Answer: Identify: Rent on factory
equipment
◉ Period Costs. Answer: Identify: Utility cost for the store
◉ Period Costs. Answer: Identify: Salary paid to the company's chief
executive officer
◉ Manufacturing Overhead. Answer: Identify: Salary paid to
mechanics who maintain and repair factory equipment
◉ Direct Labor. Answer: Identify: Wages paid to assembly-line
workers who install interiors in automobiles
◉ a. deal with the economic events of an enterprise. Answer:
Financial and managerial accounting are similar in that both:
,a. deal with the economic events of an enterprise.
b. produce general-purpose reports.
c. have the same primary users.
d. have reports that are prepared quarterly and annually.
◉ c. the product is sold. Answer: Product costs are expenses on the
income statement when:
a. the product completes the manufacturing process.
b. the order is received for the product.
c. the product is sold.
d. raw materials for the product are purchased.
◉ a. $22,500
15,500 + 44,500 - 37,500 =. Answer: Super Tread Inc. is a large
manufacturer of auto tires. Super Tread has provided the following
information:
Sales Revenue $55,000
Beginning Finished Goods Inventory $15,500
Cost of Goods sold $37,500
Cost of Goods Manufactured $44,500
, Calculate the amount of ending Finished Goods Inventory reported
on Super Tread's balance sheet.
◉ c. $1,135,000
Direct Materials (81,000+360,000-59,000) + Direct Labor (471,000)
+ Factory Overhead (19,000+24,000+268,000) + Work-in-Process
(26,000-55,000). Answer: Payton Corporation provided the
following information for the year:
Beginning Balance - Work-in-Process Inventory $26,000
Ending Balance - Work-in-Process Inventory $55,000
Beginning Balance - Direct Materials 81,000
Ending Balance - Direct Materials 59,000
Purchases - Direct Materials 360,000
Direct Labor 471,000
Indirect Labor 19,000
Depreciation on Factory Plant and Equipment 24,000
Plant Utilities and Insurance 268,000
What was the amount of the cost of goods manufactured for the
year?
a. $1,363,000
b. $1,193,000
