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ACC2312: MANAGERIAL ACCOUNTING
MIDTERM EXAMINATION SPRING 2023
VERSION: A
Name:
AID
Program:
Cohort:
Instructor: Dr. Karan Sabharwal
Date:
Duration: 100 mins
Total: 20%
Score:
Exam Instructions:
1. DO NOT OPEN THE EXAMS UNTIL YOU ARE TOLD TO DO SO!
2. There is no talking or non-verbal communication between students once exam distribution
begins, as per our Academic Integrity policy guidelines. KEEP YOUR EYES ON YOUR OWN
EXAM PAPERS!
3. Cell phones, smart watches and earphones are prohibited during exams and must be turned
off for the duration of the exam (stored in book bags and not on the students)
4. No one is allowed to leave during the first 30 minutes and the last 10 minutes of the exam
time.
5. No sharing of pens, pencils, calculators, dictionaries, notes, books, or erasers.
6. For Multiple choice/True or False/ Matching questions: Mark the best the answer to each
question in both your exam paper and on the Scantron provided with a pencil (no pens).
7. For fill in the blanks/short answers/long answers/essay questions: Clearly write your answer
on the space/sheets provided.
8. Write Name and AID on all additional sheets. Fill in your AID number on the Scantron
provided.
** Failure to comply with the rules can result in having your exam paper taken away, being asked to
leave the premises, and receiving a zero for this exam.
Maximum marks 40
Ques 1: Million Dollar Mills is a manufacturing firm. The company carefully prepares all financial
statements in accordance with Accounting Standards for Private Enterprises (ASPE) and gives a
copy of all financial statements to each department. In addition, the company keeps records for
quality control, safety, and environmental pollution. It then prepares “scorecards” for each
department indicating their performance. Recently, the financial impact of the second set of
information was added, and the information has been used in the evaluation of employees for merit
pay and promotions.
At the most recent employee meeting, Thanh Nguyen, marketing manager, expressed his
discomfort with the system. He said there was no guarantee that the second set of information was
fair since there were no generally accepted principles for this kind of information. He also said
that it was kind of like keeping two sets of books—one following all legal requirements, and the
other one actually used by the company.
a) Is it ethical to evaluate managers in the way described? Explain briefly.
b) Name at least two safeguards the company could build into its system to ensure the ethical
treatment of employees. (3+3=6 marks)
Ques 2: Presented below are incomplete manufacturing cost data. Determine the missing amounts
for three different situations
Determine missing amounts in calculating cost of goods manufactured. (3 marks)
Ques 3: Wu-Li Corporation incurred the following costs while manufacturing its product:
a) Identify each of the above costs as direct materials, direct labour, manufacturing overhead,
or period costs.
b) Explain the basic difference in accounting for product costs and period costs. (5+4=9
marks)
Ques 4: During the current month, Dalmar Company incurs the following manufacturing costs:
•
•
•
Purchased raw materials of $16,000 on account.
Incurred factory labour of $40,000.
Factory utilities of $3,100 are payable, prepaid factory insurance of $2,400 has expired,
and depreciation on the factory building is $9,500.
a) Prepare journal entries for each type of manufacturing cost.(1+1+2=4 marks)
Ques 5: Laubitz Company begins operations on April 1. Information from job cost sheets shows
the following:
Each job was sold for 25% above its cost in the month following completion.
a) Calculate the balance in Work in Process Inventory at the end of each month.
b) Calculate the balance in Finished Goods Inventory at the end of each month.
c) Calculate the gross profit for May, June, and July. (3*3=9 marks)
Ques 6: Fernando Company manufactures pizza sauce through two production departments:
cooking and canning. In each process, direct materials and conversion costs are incurred evenly
throughout the process. For the month of April, the work in process inventory accounts show the
following debits:
a) Journalize the April transactions, using April 30 as the date. (9 marks)