Spring 2006 Exam 1 VI

Spring 2006 Exam 1 VI - Acct 2301 (Spring 2006) - Exam 1...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
Page 1 Acct 2301 (Spring 2006) - Exam 1 Student: ___________________________________________________________________________ 1. Sliter Company sells CD players for $50. Variable costs are 40% of sales and total fixed costs are $40,000. What is the firm's operating leverage if 2,000 units are sold? A. 3.0 B. 2.0 C. 1.5 D. 0 E. None of the above 2. What is your intended major? If you are currently undecided (or if your major is not listed), please leave the question blank. (Don't worry, you can't miss this problem.) A. Accounting B. Finance C. ISQS (information systems) D. Marketing E. Management 3. Robert is involved in deciding whether to remain in the home he has lived in for the past ten years which is located very near his work or to move into a newer home that is located in the suburbs further from his job. The old house was purchased for $140,000 and has a market value of $200,000. The new home can be purchased for $275,000. Choose the choice that contains information that is not relevant to Robert's decision? A. driving distance to work B. cost of the new house C. market value of the old house D. cost of the old house E. All of the above are relevant to the decision.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Page 2 4. Great Products Company currently outsources an electrical switch that is a component in one of its products. The switches cost $20 each. The company is considering making the switches internally at the following projected annual production costs: The company expects an annual need for 5,000 switches. If the company makes the product, it will have to utilize factory space currently being leased for $1,500 a month. Assume the company will need a supervisor to oversee production of the switches. Ignore qualitative considerations. If the company decides to make the parts, the total relevant costs will be A. $110,500 B. $92,500 C. $55,000 D. $30,000 E. None of the costs are relevant. 5. During its first year of operations, the Jones company paid $3,000 for direct materials and $7,500 for production workers' wages. Lease payments and utilities on the production facilities amounted to $5,500 while general, selling, and administrative expenses totaled $2,000. The company produced 5,000 units and sold 4,000 units at a price of $8.50 a unit. What is the amount of gross margin for the first year? A. $18,000 B. $21,200 C. $16,000 D. $19,600 E. None of the above. 6. Pomeranz Company produces a product that has a selling price of $12.00 and a variable cost of $6.00 per unit. The company's fixed costs are $120,000. What is the breakeven point in sales dollars? A. $ 30,000 B. $120,000 C. $200,000 D. $240,000 E. None of the above
Background image of page 2
Page 3 7. The following information is provided for Greene Company for the 2005 accounting year. This is the company's first year of operations. Based on the above information, what is the company's cost of goods sold for 2005? (Note: The Overhead
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 04/22/2008 for the course ACCT 2302 taught by Professor All during the Spring '08 term at Texas Tech.

Page1 / 16

Spring 2006 Exam 1 VI - Acct 2301 (Spring 2006) - Exam 1...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online