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MULTIPLE CHOICE Which of the following must be maintained by the company to have an effective control of materials? Safety Stock Combination of duties 1. a. b. c. Limited access d. None of the choices

MULTIPLE CHOICE Which of the following must be maintained by the company to have an effective control of materials? Safety Stock Combination of duties 1. a. b. c. Limited access d. None of the choices

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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MULTIPLE CHOICE Which of the following must be maintained by the company to have an effective control of materials? Safety Stock Combination of duties 4. 1. a. b. 2. The following persons are involved in the physical control of materials in the company, except Cost accountant Production department supervisor a. b. 3. The following are the procedure of purchasing and receiving materials: 1. The purchasing agent completes a purchase order. 2. The receiving clerk prepares a receiving report. 3. The purchase materials are recorded by the accounting department. 4. Purchase requisition is prepared to notify the purchasing agent. a. b. a. b. c. Limited access d. None of the choices Determine the right sequence of these events a. 1,2,3,4 b. 4,1,2,3 c. Purchasing agent d. Receiving clerk The employee who is responsible for preparing a purchase requisition is most likely the: Production department supervisor Cost accountant C. Safety stocks d. Carrying costs c. 4,2,1,3 d. 1,4,2,3 5. To compute the reorder point, the following data must be needed, except: The rate at which the material is used The lead time a. Cost of shortages b. Cost of ordering c. Purchasing agent d. Storeroom keeper 6. His duties includes looking for the economical price of materials, to place an order to the supplier, and verifying invoices: a. Production department supervisor b. Cost accountant c. Receiving clerk d. Purchasing agent 7. The following classes of costs are usually involved in inventory decisions except c. Carrying cost d. Machining cost
Transcribed Image Text:MULTIPLE CHOICE Which of the following must be maintained by the company to have an effective control of materials? Safety Stock Combination of duties 4. 1. a. b. 2. The following persons are involved in the physical control of materials in the company, except Cost accountant Production department supervisor a. b. 3. The following are the procedure of purchasing and receiving materials: 1. The purchasing agent completes a purchase order. 2. The receiving clerk prepares a receiving report. 3. The purchase materials are recorded by the accounting department. 4. Purchase requisition is prepared to notify the purchasing agent. a. b. a. b. c. Limited access d. None of the choices Determine the right sequence of these events a. 1,2,3,4 b. 4,1,2,3 c. Purchasing agent d. Receiving clerk The employee who is responsible for preparing a purchase requisition is most likely the: Production department supervisor Cost accountant C. Safety stocks d. Carrying costs c. 4,2,1,3 d. 1,4,2,3 5. To compute the reorder point, the following data must be needed, except: The rate at which the material is used The lead time a. Cost of shortages b. Cost of ordering c. Purchasing agent d. Storeroom keeper 6. His duties includes looking for the economical price of materials, to place an order to the supplier, and verifying invoices: a. Production department supervisor b. Cost accountant c. Receiving clerk d. Purchasing agent 7. The following classes of costs are usually involved in inventory decisions except c. Carrying cost d. Machining cost
8. What form is used to notify the purchasing agent that additional materials are needed by the company? a. Receiving report b. Purchase requisition form 9. EOQ is the order quantity that a. minimizes the total ordering cost c. minimizes total inventory costs d. minimizes total ordering costs b. minimizes the safety stock c. Materials requisition form d. Suppliers invoice. 10. Darlene works in a factory where she is responsible for monitoring quantities of materials on hand. The position of Darlene is a/an: a. Storeroom keeper c. Purchasing agent b. Inspector d. Receiving clerk 11. The cost of insurance and taxes are included in a. b. Setup cost Cost of ordering c. Cost of shortages d. Inventory carrying cost 12. Rian is a purchasing agent at PRTC Corp. his duties include looking for suppliers and ordering of materials. Due to recent economic fall, Rian has been assigned to be the one to prepare the receiving reports after comparing the goods received to the purchase order. This violates material control: a. Limited access to materials c. Independence b. Segregation of duties d. Accuracy in recording 13. The objective of EOQ is? a. To minimize total ordering cost and maximize total carrying costs b. To minimize total carrying costs and maximize total ordering costs C. To minimize total ordering costs and total carrying costs d. To order sufficient units to economically meet the next period's demand. 14. The company has an EOQ of 200 units but the management decides to increase the order size to 300 units. How should this change affect the total annual order cost and total annual carrying cost for an order size of 300 units compared to the EOQ of 200 units? a. Total ordering cost and total carrying costs will increase b. Total ordering cost and total carrying costs will decrease C. Total ordering cost will increase and total carrying costs will decrease d. Total ordering cost will decrease and total carrying costs will increase 15. The minimum stock level is calculated as a. b. (Reorder level + Normal consumption) / normal delivery time (Reorder level + Normal consumption) x normal delivery time Reorder level + (Normal consumption x normal delivery time) d. Reorder level - (Normal consumption x normal delivery time) C.
Transcribed Image Text:8. What form is used to notify the purchasing agent that additional materials are needed by the company? a. Receiving report b. Purchase requisition form 9. EOQ is the order quantity that a. minimizes the total ordering cost c. minimizes total inventory costs d. minimizes total ordering costs b. minimizes the safety stock c. Materials requisition form d. Suppliers invoice. 10. Darlene works in a factory where she is responsible for monitoring quantities of materials on hand. The position of Darlene is a/an: a. Storeroom keeper c. Purchasing agent b. Inspector d. Receiving clerk 11. The cost of insurance and taxes are included in a. b. Setup cost Cost of ordering c. Cost of shortages d. Inventory carrying cost 12. Rian is a purchasing agent at PRTC Corp. his duties include looking for suppliers and ordering of materials. Due to recent economic fall, Rian has been assigned to be the one to prepare the receiving reports after comparing the goods received to the purchase order. This violates material control: a. Limited access to materials c. Independence b. Segregation of duties d. Accuracy in recording 13. The objective of EOQ is? a. To minimize total ordering cost and maximize total carrying costs b. To minimize total carrying costs and maximize total ordering costs C. To minimize total ordering costs and total carrying costs d. To order sufficient units to economically meet the next period's demand. 14. The company has an EOQ of 200 units but the management decides to increase the order size to 300 units. How should this change affect the total annual order cost and total annual carrying cost for an order size of 300 units compared to the EOQ of 200 units? a. Total ordering cost and total carrying costs will increase b. Total ordering cost and total carrying costs will decrease C. Total ordering cost will increase and total carrying costs will decrease d. Total ordering cost will decrease and total carrying costs will increase 15. The minimum stock level is calculated as a. b. (Reorder level + Normal consumption) / normal delivery time (Reorder level + Normal consumption) x normal delivery time Reorder level + (Normal consumption x normal delivery time) d. Reorder level - (Normal consumption x normal delivery time) C.
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