Managerial Quiz Keys Chapters 2, 4, 5 - Accounting 2600 chapter 2 quiz 1 Which of the following is the best example of an INDIRECT manufacturing cost

Managerial Quiz Keys Chapters 2, 4, 5 - Accounting 2600...

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Unformatted text preview: Accounting 2600 — chapter 2 quiz 1. Which of the following is the best example of an INDIRECT manufacturing cost for a golf club manufacturer? a. Rubber used for the grips on the golf clubs ost to repair equipment used to manufacture the golf clubs c. Labor costs for people manufacturing the golf clubs ‘ d. Advertising costs to help sell the golf clubs 2. Company U incurred the following costs for July: Direct Materials: $100,000; Direct Labor: $200,000; Overhead: $50,000. What are Company US cenversion costs for July? a.$1oo,000 b.$150,000 Qumexsioh = ’01, + ox) @250300 200 e. + €03“ d.$300,000 250 K 3. Gross margin equals a. cost of goods sold - Selling and administrative expenses. b. direct materials + direct labor + manufacturing overhead. 0. cost of goods manufactured + selling and administrative expenses. @ales revenue - cost of goods sold. 4. Company U incurred the following costs for July: Direct Materials: $100,000; Direct Labor: $200,000; Overhead: $50,000. What are Company US prime costs for July? a.$100,000 b.$150,000 - 3fng =. DNA, DL c.$250,000 , 100K. Jr 20m; 13:00 K _. @ssoohod 5. An opportunity cost is a. the total product cost of goods completed during the current period and transferred to finished goods inventory. ' b. the cost to market, distn'bute, and service a product or service. 0. the difference between sales revenue and cost of goods sold. @he benefit given up or sacrificed when one alternative is chosen over another. 6. Which of the following is the best example of a PERIOD cost for a golf club manufacturer? a. Rubber used for the grips on the golf clubs b. Cost to repair equipment used to manufacture the golf clubs 0. Labor costs for people manufacturing the golf clubs dvertising costs to help sell the golf clubs 7. Which of the following is most commonly associated with MANAGERIAL accounting? mphasis on the future b. Must follow externally imposed rules c. Externally focused d. Information about the company as a whole Figure 13—5 Lonborg Co. had the foilowing beginning and ending inventory baiances for the year ended December 31, 2011: January 1, 2011 December 31, '- 2011 Materials $10,000 0 8,000 Work in Process $18,000 $17,000 Finished Goods $21,000 $16,500 In addition, direct labor costs of $30,000 were incurred, overhead e ualed $42,000, materials purcfia“ se‘dTvere $27,000 ana seihng and administrative c0513 were $22,000. Lonborg Co. so ,000 units of product during the year at a sales price of $5.00 per unit. 8. Refer to Figure 13—5. What was the amount of cost of goods manufactured for the year? a.$97,500 NW 153 ugloob b.$106,500 7 W 2%000 0L 30,000 c.0128,500 0v 01,000 MW @0102000 mm 9. Refer to Fi e 1 ' a. $27,000 0M1 0% 10,005 @29000 Qurdn- 21,006 c.$37,000 8%: ($0007 (1. $45,000 9,“ germ-3 <3 materials for the year? 10. Refer to Figure 13—5. What was the amount of cost of . ods sold for the year? a. $97,500 {,b 3% .- 21,000 @106,500 carom {01,000 c.$128,500 EB @0500? d.$102,000 6066 “39,600 Test Number: % Name: Uid: Chapter 4 Quiz Multiple Choice Identifi) the choice that best completes the statement or answers the question. 1. Wiseman Company sells its product for $80. In addition, it has a variable cost ratio of 60 percent and total fixed costs of $10,000. What is the break—even point in sales dollars for Wiseman Company? . $32,000 _ 1: $4,800 (250 x ° (0 H Heb Bil-‘50 PR EEO :: 243,000 0- $20900 ‘pr “1‘ng 40,000 :0 @$25.000 32x 3 {Dream X = Sizes 2. Bennion Company expects the following results for the next accounting period: Sales $240,000 Variable costs $135,000 Fixed costs $ 40,000 Expected production and sales in units 3,000 The sales manager believes sales could be increased by 400 units if advertising expenditures were increased by $10,000. If advertising expenditures are increased and sales increase by 400 units, the effect on operating income will be a(n) — [hint calculating the contribution margin/unit will help you answer this question] 2H0 000 2411000 I . decrease of $4,000. 0 36 000-3 053’- 0007 increase of $4,000. ‘ j L56 000 0. increase of $30,000. 01°10“ ___!_’D— d. increase of $22,000. (a S. 000 GR , 000 e. cannot be determined from data given. MK-(p-SK“: AK 3. If the selling price per unit increases, the break-even point in units will a. increase. decrease. . remain the same; however, contribution per unit will decrease. d. remain the same. fix-ax “-————-—- '-'- vi“ SPhML EB. Uh 8 Figure 4-3. Cameron Company makes calendars. Information on cost per unit is as follows: Variable costs: Direct materials $1.50 Direct labor 1.20 Variable overhead 0.90 Variable marketing expense 0.40 Fixed marketing expense totaled $13,000 and fixed administrative expense totaled $35,000. The price per calendar is $10. 4. Refer to Figure 4-3. How many units must be sold to yield targeted income of $36,000? a. 5 333 ’ V5 — — KIM b' \-2. m u — (0 6x = Lifiooo + agree (3 c- s 9% @ 14,000 .q 551:, 0x=gq,oao . 12 ‘—""‘" I #- iI-t 00C) 6 ’00” '-l wk, 3’ K X ' '49: K Wait 5. Refer to Figure 4-3. What is the break-even point in units? a. 2,167 0. 12,000 (ox = Hippos 0. 2,800 8,000 X = ‘2’) , 000 e. 5,833 6. Refer to Figure 4-3. If Cameron offers a promotion of $2.50 off the regular purchase price of a calendar, how many more units (not how many — how many MORE) must be sold to reach a target income of $36,000? a. 5,091 35. X: (3,, 600 214,000 b. 7,539 I W 00% 10,000 x :24,000 ’ . 20,000 “3/000 7. At the break-even point, a. total sales equals total fixed' cost. b. total fixed cost equals variable cost. c. total revenue equals variable cost. @total contribution margin equals total fixed cost. . total margin of safety equals variable cost. 8. Assume the following information: Selling price per unit $150 Contribution margin ratio 40% Total fixed costs $225,000 How many units must be sold to generate a profit of $45,000? a. 2500 units a D '5:- C) b. 3,000 units “'30 X q 6 0. 3,750 units @354 = 2315/06 C) @4500 units 225, 000 List 000 75“ Liqo C) ,_________. 210,000 9. Buchanan Company produces a product which sells for $30. Variable manufacturing costs are $15 per unit. Fixed manufacturing costs are $5 per unit (fixed costs / units produced) based on the current level of activity, and M selling and administrative costs are $4 per unit (fixed costs / units produced). A selling commission of 10% of the selling price is paid on each unit sold. The contribution margin per unit is: b. $15 0,; '. L ED c. $8 cghmtssiw 2 @351 i1 10. Diaz Inc., a company that produces and sells a single product, has provided its contribution format income statement for February. ' Sales (9,500 units) ........ ..$769,500 Variable expenses ......... .. 522.500 Contribution margin........ 247,000 Fixed expenses ............ .. 174.500 Net operating income .... .. $ 72,500 If the company sells 9,700 units, its total contribution margin should be closest to: $252,200 . $74,026 . m H 0. $247,000 (“506 ‘ 2‘0 d. $263,200 2g, xaaoo = 252, 200 Name UID Test Number q-S Chapter 5 Quiz Multiple Choice Identify the choice that best completes the statement or answers the question. Figure 5-7. At the beginning of the year, Wilson Company estimated the following: Overhead $360,000 Direct labor hours 60,000 Wilson used normal costing and applies overhead on the basis of direct labor hours. For the month of September, direct labor hours equaled 9,350 and actual overhead equaled $46,750. 1. Refer to Figure 5-7. What type of variance did the Company have for month of September, if any? No variance \I (“\‘(NnLQ -:. Amok " Ps'pp'u‘tA a. b. Under-applied overhead 3 "l (p {+50 "‘ 1319 , loo Eb Over-applied overhead u G? 3% 0‘ J Pspvlctch 7 prb'l‘UOA (a x4660 --= 69,100 $5 per direct labor hour ___ 2. Refer to Figure 5-7. Calculate the overhead applied to production in September. $56,100 b. $30,000 "3133-in : 9 1 0. $46,750 (I. 6. None of these. __ 3. The predetermined overhead rate is calculated by a. estimated annual overhead/Estimated manufacturing cost. b. actual annual overhead/Estimated annual activity level. 0. estimated annual overhead/Actual annual activity level. d. actual annual overheadectual annual activity level. ® estimated annual overheadlEstirnated annual activity level. Figure 5—2. At the beginning of the year, Kyla Inc. estimated that overhead would be $880,000 and direct labor hours would be 220,000. At the end of the year, actual overhead was $920,600 and there were actually 230,000 direct labor hours. Kyla, Inc. calculates and applies overhead based on direct labor hours. 4. Refer to Figure 5-2. What adjustment would Kyla Inc. make for the overhead variance if none of the inventory had been sold by the end of the year? Increase the finished goods inventory balance b. Decrease the finished goods inventory balance 0. Increase cost of goods sold. d. Decrease cost of goods sold. 5. Refer to Figure 5-2. What is the overhead variance? $600 overapplied 21 Q5) $600 underapplied c $200 underapplied WOA ' W?“ (1 6 $400 overapplied $800 underapplied QvPK-(A L 6. Refer to Figure 5-2. What is the predetermined overhead rate? a $4 er direct labor hour . 1’ egg, oao b. $2.63 per direct labor hour r-———-—-""" 1 O C. $4.18 per direct labor hour 220 ,r O o d. $880,000 Figure 5-3. Mitchell's Softball Gloves Company estimated the following at the beginning of the year: Assembly Degartment Testing Department Total Overhead $570,000 $130,000 $700,000 Direct Labor Hours 142,500 32,500 175,000 Machine Hours 32,000 65,000 97,000 Mitchell uses dc artmental overhead ratesE} the assembly department, direct labor hours are used to apply overheaa‘ Machine hours are used to apply overhead in the testing department. Actual data for August is as follows: Assembly Department Testing Department Total Overhead $42,000 $12,000 $54,000 Direct Labor Hours 13,500 2,430 15,930 Machine Hours 4,020 11,000 15,020 7. Refer to Figure 5-3. Mitchell uses departmental overhead rates. What are the predetermined rates for the Assembly and Testing departments respectively? assembly: $4 per direct labor hour; testing: $2 per machine hour In. assembly: $2 per direct labor hour; testing: $4 per machine hour c. assembly: $4 per direct labor hour; testing: $4 per direct labor hour d. assembly: $7.22 per machine hour; testing: $7.22 per machine hour 8. Carlson Company uses a predetermined rate to apply overhead. At the beginning of the year, Carlson estimated its overhead costs at $240,000, direct labor hours at 40,000, and machine hours at 10,000. Actual overhead costs incurred were $249,280, actual direct labor hours were 41 ,000, and actual machine hours were 11,000. If the predetermined overhead rate is based on machine hours, what is the total amount of overhead applied for the year for Carlson? a. $249,280 2140’ o O (.3 b. $246,000 \0 , oo 0 I 2” c. $240,000 GD $264,000 1H A l\ :000 = 9-‘0‘4 r 000 _ 9. Which of the following is the assignment process used with normal costing? a. Actual direct labor cost is assigned to products, but direct material and overhead costs are assigned using predetermined rates. Actual direct material and direct labor costs are assigned to products, but overhead costs are . : igned using predetermined rates. c. Actual direct materials, actual direct labor and actual overhead cost are assigned to products. d. All manufacturing costs are assigned using predetermined rates. e. Actual direct materials cost is assigned to products, but direct labor and overhead costs are assigned using predetermined rates. _ 10. Which of the following statements is true about overhead? a. Overhead costs have a definite, identifiable relationship with units produced. Overhead costs are not incurred uniformly throughout the year. c. Low production in one month would cause lower ACTUAL overhead costs per unit. d. All of these are correct. e. None of these are correct. ...
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