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Test 3 Practice

# Test 3 Practice - Accounting 2102 Farmer Test 3 Multiple...

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Accounting 2102 Farmer Test 3 Multiple Choice Practice (excludes Chapter 14) 1. The following information was taken from the segmented income statement of Just for Laughs, Inc.: Larry Division Curly Division Moe Division Total Revenues \$200,000 \$235,000 \$325,000 \$750,000 Variable Operating Expenses 110,000 120,000 180,000 410,000 Controllable Fixed Expenses 65,000 75,000 70,000 210,000 Noncontrollable Fixed Expenses 15,000 20,000 25,000 60,000 Laughs CEO’s salary was \$18,000 and allocated to each division on the basis of Revenue. The profit margin controllable by the Curly Division manager is: a. \$40,000. b. \$20,000. c. \$115,000. d. \$34,360. e. \$14,360. 2. Wrecks to Riches reported a return on investment of 10%, a capital turnover of 8, and income of \$180,000. On the basis of this information, the company's invested capital was: a. \$14,400,000. b. \$1,800,000. c. \$1,440,000. d. \$225,000. e. \$405,000. 3. The production team for Take Eight, Inc., a manufacturer of pillow top mattresses, recently prepared a manufacturing cost budget for an output of 50,000 mattresses, as follows: Direct Materials \$100,000 Direct Labor 50,000 Variable Overhead 75,000 Fixed Overhead 100,000 Actual costs incurred during the production of 60,000 mattresses were; direct materials, \$110,000; direct labor, \$60,000; variable overhead, \$100,000; and fixed overhead, \$97,000. If Take Eight evaluated performance by the use of a flexible

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Test 3 Practice - Accounting 2102 Farmer Test 3 Multiple...

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