Question 1

Departmental reports are useful for all of the following purposes except:

Accepted Answer

A)  determining performance.
B)  determining future revenue.
C)  controlling.
D)  planning.E) A) and D)
F) C) and D)

Question 2

Indirect expenses are allocated to departments based on:

Accepted Answer

A)  decisions of the stockholders.
B)  directives from the board of directors.
C)  some reasonable basis,such as square footage.
D)  generally accepted accounting principles.E) A) and D)
F) B) and D)

Question 3

The toy department of a department store would be a cost center.

Accepted Answer

A) True 
 B)False

Question 4

Normally,the report prepared for a department is a(n) :

Accepted Answer

A)  cash flow statement.
B)  statement of equity.
C)  income statement.
D)  balance sheet.E) A) and D)
F) B) and C)

Question 5

A profit center and a cost center both generate costs.

Accepted Answer

A) True 
 B)False

Question 6

A department income statement showing gross profit by department is a useful tool in analyzing performance of individual departments.

Accepted Answer

A) True 
 B)False

Question 7

The photography department in a department store experienced the following revenue and expenses during October:   Sales $6,500 Cost of Goods Sold 2,800 Direct Operating Expenses 200 Indirect Operating Expenses 1,300\begin{array} { | l | r | } \hline 	ext { Sales } & \$ 6,500 \\hline 	ext { Cost of Goods Sold } & 2,800 \\hline 	ext { Direct Operating Expenses } & 200 \\hline 	ext { Indirect Operating Expenses } & 1,300 \\hline\end{array} Sales  Cost of Goods Sold  Direct Operating Expenses  Indirect Operating Expenses ​$6,5002,8002001,300​​  The photography departmental net income is:

Accepted Answer

A)  $6,500.
B)  $3,700.
C)  $3,500.
D)  $2,200. E) B) and C)
F) A) and D)

Question 8

Which of the following would be a direct expense of a sales department?

Accepted Answer

A)  Sales salaries
B)  Office salaries
C)  Advertising expense
D)  Sales salaries and Advertising expenseE) B) and C)
F) C) and D)

Question 9

Windermere Corporation has 25,000 square feet in department A; 20,000 square feet in department B; and 55,000 square feet in department C.Janitorial services as based on square footages in each department.How will the $35,000 of janitorial services be allocated?

Accepted Answer

A)  $19,250 to C; $7,000 to B; and $8,750 to A.
B)  $19,250 to A; $7,000 to B; and $8,750 to C.
C)  Split evenly ($11,666.67) to each department.
D)  Cannot be determined by given information.E) A) and D)
F) A) and C)

Question 10

Gross profit by department appears on the:

Accepted Answer

A)  balance sheet.
B)  statement of retained earnings.
C)  statement of cash flows.
D)  income statement.E) A) and D)
F) B) and C)

Question 11

Of two departments,the men's department has 8,000 square feet and the women's department has 22,000 square feet.Depreciation is divided by square footage.If total depreciation is $50,000,the total amount allocated to the men's department would be approximately $13,333.

Accepted Answer

A) True 
 B)False

Question 12

In a cost center,the manager:

Accepted Answer

A)  has the responsibility for controlling costs,but not directly generating revenue.
B)  is not responsible for controlling costs,but is responsible for generating revenue.
C)  is responsible for controlling costs and generating revenue.
D)  None of these answers are correct.E) B) and D)
F) C) and D)

Question 13

Which of the following expenses is the most difficult to allocate to departments?

Accepted Answer

A)  Cost of goods sold
B)  Use of general supplies by everyone
C)  Salaries and wages
D)  Merchandise purchasesE) B) and D)
F) A) and D)

Question 14

The women's shoe department shows gross sales of $245,000 with the cost of the shoes $147,000.The men's shoe department shows gross sales of $184,000 with the cost of the shoes $110,000.What is the gross profit for each department respectively?

Accepted Answer

A)  $392,000 and $294,000
B)  $245,000 and $184,000
C)  $98,000 and $74,000
D)  $429,000 and $257,000E) A) and B)
F) A) and C)

Question 15

All of the following are used to compute gross profit except:

Accepted Answer

A)  sales.
B)  purchase returns and allowances.
C)  rent expense.
D)  purchases.E) All of the above
F) A) and B)

Question 16

When preparing an income statement showing departmental contribution margin:

Accepted Answer

A)  indirect expenses are combined with direct expenses.
B)  indirect departmental expenses are added to contribution margin.
C)  direct expenses are subtracted from contribution margin on sales.
D)  None of these answers are correct.E) None of the above
F) All of the above

Question 17

The financial statement(s) that can be broken down by departments would be:

Accepted Answer

A)  income statement.
B)  balance sheet.
C)  statement of owner's equity.
D)  All of these answers are correct.E) None of the above
F) C) and D)

Question 18

If the gross sales for the computer department are $3,700 and the book department gross sales are $6,300,what is the allocation for advertising expense of $750 to these departments,based on gross sales?

Accepted Answer

A)  Computer department $425; book department $325
B)  Computer department $375; book department $375
C)  Computer department $277.50; book department $472.50
D)  Computer department $462.50; book department $287.50E) A) and D)
F) B) and D)

Question 19

Which of the following would not be considered a direct expense?

Accepted Answer

A)  Building expenses
B)  Advertising expense
C)  Administrative expense
D)  All of the aboveE) A) and C)
F) B) and C)

Question 20

A building's depreciation would be considered an indirect expense.

Accepted Answer

A) True 
 B)False

Exam 24: Departmental Accounting

All of the following are used to compute gross profit except:

Correct Answer
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The toy department of a department store would be a cost center.

Correct Answer
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Which of the following expenses is the most difficult to allocate to departments?

Correct Answer
verified

A building's depreciation would be considered an indirect expense.

Correct Answer
verified

A profit center and a cost center both generate costs.

Correct Answer
verified

The financial statement(s) that can be broken down by departments would be:

Correct Answer
verified

Which of the following would be a direct expense of a sales department?

Correct Answer
verified

Normally,the report prepared for a department is a(n) :

Correct Answer
verified

Gross profit by department appears on the:

Correct Answer
verified

When preparing an income statement showing departmental contribution margin:

Correct Answer
verified

In a cost center,the manager:

Correct Answer
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Indirect expenses are allocated to departments based on:

Correct Answer
verified

Which of the following would not be considered a direct expense?

Correct Answer
verified

If the gross sales for the computer department are $3,700 and the book department gross sales are $6,300,what is the allocation for advertising expense of $750 to these departments,based on gross sales?

Correct Answer
verified

Departmental reports are useful for all of the following purposes except:

Correct Answer
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Correct Answer
verified

The women's shoe department shows gross sales of $245,000 with the cost of the shoes $147,000.The men's shoe department shows gross sales of $184,000 with the cost of the shoes $110,000.What is the gross profit for each department respectively?

Correct Answer
verified

A department income statement showing gross profit by department is a useful tool in analyzing performance of individual departments.

Correct Answer
verified

Windermere Corporation has 25,000 square feet in department A; 20,000 square feet in department B; and 55,000 square feet in department C.Janitorial services as based on square footages in each department.How will the $35,000 of janitorial services be allocated?

Correct Answer
verified

Of two departments,the men's department has 8,000 square feet and the women's department has 22,000 square feet.Depreciation is divided by square footage.If total depreciation is $50,000,the total amount allocated to the men's department would be approximately $13,333.

Correct Answer
verified

Exam 24: Departmental Accounting

All of the following are used to compute gross profit except:

Correct AnswerverifiedShow Answer

The toy department of a department store would be a cost center.

Correct AnswerverifiedShow Answer

Which of the following expenses is the most difficult to allocate to departments?

Correct AnswerverifiedShow Answer

A building's depreciation would be considered an indirect expense.

Correct AnswerverifiedShow Answer

A profit center and a cost center both generate costs.

Correct AnswerverifiedShow Answer

The financial statement(s) that can be broken down by departments would be:

Correct AnswerverifiedShow Answer

Which of the following would be a direct expense of a sales department?

Correct AnswerverifiedShow Answer

Normally,the report prepared for a department is a(n) :

Correct AnswerverifiedShow Answer

Gross profit by department appears on the:

Correct AnswerverifiedShow Answer

When preparing an income statement showing departmental contribution margin:

Correct AnswerverifiedShow Answer

In a cost center,the manager:

Correct AnswerverifiedShow Answer

Indirect expenses are allocated to departments based on:

Correct AnswerverifiedShow Answer

Which of the following would not be considered a direct expense?

Correct AnswerverifiedShow Answer

If the gross sales for the computer department are $3,700 and the book department gross sales are $6,300,what is the allocation for advertising expense of $750 to these departments,based on gross sales?

Correct AnswerverifiedShow Answer

Departmental reports are useful for all of the following purposes except:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The women's shoe department shows gross sales of $245,000 with the cost of the shoes $147,000.The men's shoe department shows gross sales of $184,000 with the cost of the shoes $110,000.What is the gross profit for each department respectively?

Correct AnswerverifiedShow Answer

A department income statement showing gross profit by department is a useful tool in analyzing performance of individual departments.

Correct AnswerverifiedShow Answer

Windermere Corporation has 25,000 square feet in department A; 20,000 square feet in department B; and 55,000 square feet in department C.Janitorial services as based on square footages in each department.How will the $35,000 of janitorial services be allocated?

Correct AnswerverifiedShow Answer

Of two departments,the men's department has 8,000 square feet and the women's department has 22,000 square feet.Depreciation is divided by square footage.If total depreciation is $50,000,the total amount allocated to the men's department would be approximately $13,333.

Correct AnswerverifiedShow Answer

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