Exam 3 Practice - Practice Exam 3 (Chapters 24, 25 and...

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Practice Exam 3 (Chapters 24, 25 and Appendix B) These practice questions do not cover every topic that may appear on the actual exam, but they should be a part of your exam preparation. You should also study your class notes, homework, practice problems as well as the assigned reading from the textbook. If you have any questions about this practice exam outside of class or office hours, please post a note on the ACC 310F Class Q&A Discussion Board located in the Communication section of Blackboard. 01. McNeel & Company manufactures and sells cabinets. All of the cabinets are sold without being fully assembled. Each cabinet sells for $60 and has variable costs of $35 per unit with total fixed costs of $5,000 when 500 units are made. The company is considering whether to fully assemblie the cabintes and sell them for $80. Variable finishing costs are expected to be $5 per unit. If the company has the capacity, should the company sell the cabintes after they have been fully assembled? A. Yes, net income will increase by $15 per unit. B. Yes, net income will increase by $20 per unit. C. Yes, net income will increase by $25 per unit. D. Yes, net income will increase by $5 per unit. E. No, net income will not change. 02. For a capital budgeting decision, how many of the following would be included in cash inflows? Sale of old asset Initial investment Repairs and maintenance Cash from customers Operating costs A. 0 B. 1 C. 2 D. 3 E. 4 03. Which of the following would most likely appear as a fixed expense on the Selling and Administrative Expense Budget? A. Delivery costs B. Factory supervisor salary C. Wages for indirect labor D. Lease payments for copy machine 04. Transmogrifier Transportation, Inc. purchased a new vehicle by obtaining a loan. The company agreed to the following terms: Annual Payment 8,000 Rate 6% Term of loan (in years) 5 What is the total amount of interest that the company will pay on the loan? Answer -- Page 1 of 6 --
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05. If you are able to earn a 10% rate of return, what amount would you need to invest to have $500 two years from now? A.
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This note was uploaded on 04/12/2009 for the course ACC 310F taught by Professor Verduzco during the Fall '07 term at University of Texas at Austin.

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Exam 3 Practice - Practice Exam 3 (Chapters 24, 25 and...

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