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BUS-2003 (5)
Midterm

# Practice Test #1

5 Pages
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School
University of Winnipeg
Department
Course
BUS-2003
Professor
Debbie Mortimer
Semester
Fall

Description
DEPARTMENT OF BUSINESS AND ADMINISTRATION BUS2003 Test 1 September 29, 2010 Name:____________________________________________________ Student Number: __________________________________________ Instructions: Please answer the following questions on the examination test sheets. If you need more room, please use the back of the pages. Show your calculations in detail. Grading: Q1 /13 Q2 /15 Q3 /5 Total /33 BUS2003 Test 1 page 1 of 5 Question 1: (13 marks) The following information is from Marchant Manufacturing Co. for September: Direct materials used in production \$ 95,000 Direct labour \$ 67,000 Total manufacturing cost \$234,000 Direct materials inventory, Sept. 1 \$ 24,000 Work-in-process inventory, Sept. 1 \$ 6,000 Finished goods inventory, Sept. 1 \$101,000 Purchases of direct materials \$102,000 Cost of goods manufactured \$233,000 Administrative expense \$ 41,000 Selling expense \$ 56,000 Sales \$344,000 Gross margin \$127,000 Net income \$ 30,000 Required: a) Compute the cost of goods sold. (2 marks) b) Compute the balance in finished goods inventory at September 30. (3 marks) c) Compute the balance in work-in-process inventory at September 30. (3 marks) d) Compute the balance in raw materials inventory at September 30. (3 marks) e) Compute the total manufacturing overhead. (2 marks) (Hint: The easiest method of solving this problem is to sketch out the income statement and the schedule of cost of goods manufactured, enter the given amounts, and then enter the unknowns as plug figures.) Question 1 Solution BUS2003 Test 1 page 2 of 5 BUS2003 Test 1 page 3 of 5 Question 2: (15 marks) Carver Test Systems manufactures automated testing equipment. The company uses a normal job-order costing system and applies overhead on the basis of machine hours (MH). At the beginning of the year, estimated manufacturing overhead was \$1,960,000, and the estimated machine hours was 98,000. Data regarding several jobs at Carver are presented below. Costs and MH added during the month Job Number
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