MIDTERM EXAM COPY - Concordia University John Molson School...

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Concordia University Comm 305/4Winter 2003 John Molson School of Business Midterm Examination 2 Question 1 MULTIPLE CHOICE (23 marks) 1. The predetermined overhead rate is calculated as: (1 mark) A. estimated manufacturing overhead costs/actual activity B. estimated manufacturing overhead costs/estimated activity C. actual manufacturing overhead costs/estimated activity D. actual manufacturing overhead costs/actual activity 2. Practical capacity is based on: (1 mark) A. efficient use of resources B. flexible resources C. committed resources D. all of the above T h e H a m p t o n C o m p a n y e s t i m a t e s c o s t s t o b e a s f o l l o w s a t 1 0 , 0 0 0 u n i t s o f p r o d u c t i o n : D i r e c t m a t e r i a l s $ 2 0 , 0 0 0 D i r e c t l a b o u r 4 0 , 0 0 Figure 1 0 V a r i a b l e m a n u f a c t u r i n g o v e r h e a d 1 0 , 0 0 0 F i x e d m a n u f a c t u r i n g o v e r h e a d 3 0 , 0 0 0 V a r i a b l e s e l l i n g a n d a d m i n i s t r a t i v e c o s t s 6 , 0 0 0 F i x e d s e l l i n g a n d a d m i n i s t r a t i v e c o s t s 1 8 , 0 0 0 3. Refer to Figure 1. The Hampton Company's fixed manufacturing cost per unit at production levels of 10,000 units and 15,000 units would be: (2 marks) 10,000 Units 15,000 Units A. $4.80 $4.80 B. $4.80 $3.20 C. $3.00 $2.00 D. $3.00 $3.00
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Concordia University Comm 305/4Winter 2003 John Molson School of Business Midterm Examination 3 4. The margin of safety in dollars is: (1 mark) A. expected sales minus expected profit B. expected sales minus sales at break even C. costs at break even minus expected profit D. expected costs minus costs at break even 5. Setting the company's profit targets for the upcoming year is an example of the management function of: (1 mark) A. planning B. control C. variance analysis D. internal auditing 6. The salary of the plant manager would be classified as: (1 mark) A. direct materials B. direct labour C. manufacturing overhead D. selling and administrative costs 7. Product costs are expensed when the product is: (1 mark) A. purchased B. manufactured C. inventoried D. sold
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Concordia University Comm 305/4Winter 2003 John Molson School of Business Midterm Examination 4 G a m I n d u s t r i e s p r o d u c e s t w o p r o d u c t s . I n f o r m a t i o n a b o u t t h e p r o d u c t s i s a s f o l l o w s : P r o d u c t X P r o d u c t Y U n i t s p r o d u c e d a n d s o l d 1 0 0 5 0 0 S e l l i n g p r i c e p e r u n i t $ 4 0 0 $ 2 0 0 V a r i a b l e e x p e n s e s p e r u n i t $ 2 6 0 $ 7 0 T h e c o m p a n y ' s f i x e d c o s t s t o t a l e d $ 8 0 , 0 0 0 , o f w h i c h $ 2 9 , 0 0 0 c a n b e a v o i d e d i f P r o d u c t X i s d r o p p e d a n d $ 4 5 , 0 0 0 c a n b e a v o i d e d i f P r o d u c t Y i s d r o p p e d . F
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This note was uploaded on 04/01/2010 for the course JMSB comm 305 taught by Professor Marivot during the Winter '10 term at Concordia Canada.

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MIDTERM EXAM COPY - Concordia University John Molson School...

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