1. Nelson Company’s activity for the first six months of
\n2004 is as follows:<\/p>\n
Month Machine
\nHours
\n Electrical<\/p>\n
Cost<\/p>\n
January 4,000 $3,120
\nFebruary 6,000 4,460
\nMarch 4,800 3,500
\nApril 3,800 3,040
\nMay 3,600 2,900
\nJune 4,200 3,200<\/p>\n
Using the high-low method, the variable rate per machine
\nhour would be $.40
\n$.65
\n$.67
\n$.70<\/p>\n
2. In the decision to replace an old machine with a new
\nmachine, which of the following would be considered a relevant cost? <\/p>\n
The current disposal price of the old equipment
\nThe loss on the disposal of the old equipment
\nDepreciation expense on the old equipment
\nThe book value of the old equipment<\/p>\n
3. Clarkson Industries produces an electronic calculator
\nthat sells for $75 per unit. Variable costs are $45 per unit and fixed costs
\nare $150,000 annually. The company has been averaging an annual income of
\n$100,000 over the past five years. The break-even point for Clarkson Industries
\nwould be: <\/p>\n
2,000 units.
\n3,333 units.
\n5,000 units.
\n10,000 units.<\/p>\n
4. Contribution margin is the amount remaining after <\/p>\n
variable expenses have been deducted from sales revenue.
\nfixed expenses have been deducted from sales revenue.
\nfixed expenses have been deducted from variable expenses.
\ncost of goods sold has been deducted from sales revenues.<\/p>\n
5. The Pohl Company uses a standard cost system in which
\nmanufacturing overhead is applied to units of product on the basis of machine
\nhours. For June, the company’s manufacturing overhead flexible budget showed
\nthe following total budgeted costs at a denominator activity level of 20,000
\nmachine hours:<\/p>\n
Variable overhead
\n$26,000
\nFixed overhead 30,000<\/p>\n
During June, 17,000 machine hours were used to complete
\n13,000 units of product, and the following actual total overhead costs were
\nincurred:<\/p>\n
Variable overhead
\n$25,330
\nFixed overhead 28,820<\/p>\n
At standard, each unit of finished product requires 1.4
\nhours of machine time.<\/p>\n
The fixed overhead budget variance for June was: <\/p>\n
$3,230 F.
\n$3,230 U.
\n$1,180 F.
\n$1,180 U.<\/p>\n
6. Newmax Co. is a manufacturing business. When it pays the
\nworkers who assemble its products, the cash account should be decreased and
\nwhat account should be increased? <\/p>\n
Cost of goods sold
\nWork-in-process inventory
\nManufacturing overhead
\nFinished goods inventory<\/p>\n
7. The Talbot Company produces wheels that are used in the
\nproduction of bicycles. Talbot’s costs to produce 100,000 wheels annually are:<\/p>\n
Direct materials $
\n30,000
\nDirect labor 50,000
\nVariable overhead 20,000
\nFixed overhead 70,000
\nTotal $170,000<\/p>\n
An outside supplier has offered to sell Talbot similar
\nwheels for $1.25 per wheel. If the wheels were purchased from the outside
\nsupplier, $15,000 of annual fixed factory overhead could be avoided.<\/p>\n
What is the highest price that Talbot could pay the outside
\nsupplier for the wheel and still be economically indifferent between making or
\nbuying the wheels? <\/p>\n
$1.70
\n$1.15
\n$1.00
\n$ .80<\/p>\n
8. The cost of goods sold in a merchandising firm typically
\nwould be classified as a <\/p>\n
variable cost.
\nfixed cost.
\nmixed cost.
\nstep-variable cost.<\/p>\n
9. Questions 9 and 10 refer to the following:<\/p>\n
Jones Co. is considering buying a machine that cost
\n$100,000. If purchased, Jones believes the new machine will reduce its
\noperating cost by $20,000 per year for the next 10 years. At the end of 10
\nyears the machine will have $0 salvage value. If acquired, Jones will
\ndepreciate the machine using the straight-line method.<\/p>\n
Jones\u00e2\u0080\u0099 cost of capital is 12%. From present value tables,
\nJones had identified that the present value factor for an amount of 1,
\ndiscounted at 12%, is .322, while the present value of a 10 year annuity of 1,
\ndiscounted at 12%, is 5.65.<\/p>\n
Ignoring income taxes, what is the payback period of this
\nproject ( help with nursing paper writing from experts with MSN & DNP degrees)? <\/p>\n
5.0 years
\n4.5 years
\n4.4 years
\n4.0 years<\/p>\n
10. Ignoring income taxes, what is the net present value of
\nthis project ( help with nursing paper writing from experts with MSN & DNP degrees)? <\/p>\n
$ 5,760
\n$ 6,440
\n$12,200
\n$13,000<\/p>\n
11. The individual generally responsible for explaining the
\ndirect-labor efficiency variance is the: <\/p>\n
the purchasing agent.
\nthe sales manager.
\nthe production manager. LINDA
\nthe industrial engineering department.<\/p>\n
12. Allen Company collects 25% of a month’s sales in the
\nmonth of sale, 70% in the month following sale, and 4% in the second month
\nfollowing sale. The remainder is uncollectible. Budgeted sales for the next
\nthree months are:
\nApril May June
\nBudgeted sales
\n$100,000 $120,000 $110,000<\/p>\n
Cash collections in June are budgeted would be: <\/p>\n
$115,500.
\n$111,000.
\n$110,000.
\n$113,400.<\/p>\n
13. Young Enterprises has budgeted sales in units for the
\nnext four months as follows:
\nJune 10,000 units
\nJuly 8,000 units
\nAugust 12,000 units
\nSeptember 14,800 units<\/p>\n
Past experience has shown that the ending inventory for each
\nmonth should be equal to 20% of the next month’s sales in units. Budgeted
\nproduction for July should be: <\/p>\n
8,800 units.
\n8,400 units.
\n8,000 units.
\n7,200 units.<\/p>\n
14. The Collins Company applies overhead to production
\norders on the basis of machine hours. At the beginning of 2002, the company
\nmade the following estimates:<\/p>\n
Estimated Amount <\/p>\n
Direct labor cost $100,000
\nIndirect labor cost 25,000
\nAdvertising expense 30,000
\nDirect materials 50,000
\nIndirect materials 10,000
\nDepreciation on factory equipment 40,000
\nMachine hours to be worked 10,000<\/p>\n
What predetermined overhead rate should Collins Co. use? <\/p>\n
$ 3.50
\n$ 7.50
\n$ 9.00
\n$12.00<\/p>\n
15. The purpose of a flexible budget is to: <\/p>\n
reduce the total time in preparing the annual budget.
\ncompare actual and budgeted results at virtually any level
\nof production.
\neliminate cyclical fluctuations in production reports by
\nignoring variable costs.
\nallow management some latitude in meeting goals.<\/p>\n
16. Following is information relating to Kew Co.’s Vale
\nDivision for 2001:<\/p>\n
Sales $500,000
\nVariable expenses 300,000
\nFixed expenses 50,000
\nAverage operating assets 1,000,000
\nMinimum desired return 12%<\/p>\n
What was Vale’s residual income? <\/p>\n
$120,000
\n$150,000
\n$ 30,000
\n$ 80,000<\/p>\n
17. The labor time required to assemble a product is an
\nexample of a: <\/p>\n
Unit-level activity.
\nBatch-level activity.
\nProduct-level activity.
\nFacility-level activity.<\/p>\n
18. Anola Company has two products: A and B. The company
\nuses activity- based costing to determine product costs. The estimated overhead
\ncosts and expected activity for each of the company’s three overhead activity
\ncenters are as follows:<\/p>\n
Activity <\/p>\n
Center<\/p>\n
Estimated <\/p>\n
Overhead <\/p>\n
Costs
\n Expected
\nActivity
\n Total Product A Product
\nB
\nActivity 1 $18,000 500 300 200
\nActivity 2 $16,000 600 500 100
\nActivity 3 $27,000 900 600 300<\/p>\n
The predetermined overhead rate under the activity-based
\ncosting system for Activity 3 is closest to: <\/p>\n
$30.00.
\n$30.50.
\n$90.00.
\n$67.78.<\/p>\n
19. A standard is: <\/p>\n
unrelated to budgeting since standards are used for control
\npurposes only.
\nnormally set at the ideal rather than the practical level of
\ncost, efficiency, or quantity.
\nnormally not applied to the variable portion of overhead.
\nthe budgeted cost for one unit of product.<\/p>\n
20. Which of the following would be most appropriate for
\nevaluating a cost center? <\/p>\n
Return on investment
\nContribution margin percentage
\nA static budget
\nA standard costing system<\/p>\n","protected":false},"excerpt":{"rendered":"
1. Nelson Company’s activity for the first six months of 2004 is as follows: Month Machine Hours Electrical Cost January 4,000 $3,120 February 6,000 4,460\u2026<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8827,10099,10540,10536,10892,10538,10539,10537,10891],"tags":[10549,10616,10615,7687,10627,8857,10552,10295,10548,10622,8907],"class_list":["post-130267","post","type-post","status-publish","format-standard","hentry","category-australia-essays","category-buy-essay","category-cheap-essay-writers","category-get-assignments-done","category-page-paper","category-phd-essay-writers","category-research-paper-writing-service-for-any-topic","category-study-bay-essay","category-write-my-assignment-ireland","tag-ai-plagiarism-free-essay-writing-tool","tag-australian-best-tutors","tag-best-trans-tutors","tag-buy-essay-uk","tag-cheap-dissertation-writer","tag-help-with-writing-an-essay","tag-help-write-my-paper-ai-free","tag-homework-for-you","tag-online-essay-writers","tag-phd-essays","tag-write-my-essay-for-me"],"_links":{"self":[{"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/posts\/130267","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/comments?post=130267"}],"version-history":[{"count":0,"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/posts\/130267\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/media?parent=130267"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/categories?post=130267"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.studyproessays.com\/help\/wp-json\/wp\/v2\/tags?post=130267"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}