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Unformatted text preview: Name: ________________________ Class: ___________________ Date: __________ ID: S 1 ACCT1B  Managerial Accounting: Sample Exam 4 Multiple Choice Identify the choice that best completes the statement or answers the question. ____ 1. Niva Co. Manufactures three products: Bales; Tales and Wales. The selling prices are: 55; 78; and 32 respectively. The variable costs for each product are: 20; 50; and 15, respectively. Each product must go through the same processing in a machine that is limited to 2,000 hours per month. Bales take 7 hours to process, Tales take 4 hours, and Wales take 1 hour. Assuming that Niva produced enough product with the highest contribution margin per unit to use 1,000 hours of machine time. Product demand does not warrant any more production of that product. What is the maximum additional contribution margin that can be realized by utilizing the remaining 1,000 hours on the product with the second highest contribution margin per hour? a. $5,000 b. $7,000 c. $4,000 d. $28,000 ____ 2. Dary Co. Produces a single product. It's normal selling price is $28 per unit. The variable costs are $18 per unit. Fixed costs are $20,000 for a normal production run of 5,000 units per month. Dary received a request for a special order that would not interfere with normal sales. The order was for 1,500 units and a special price of $17.50 per unit. Dary Co. has the capacity to handle the special order, and for this order a variable selling cost of $2 per unit would be eliminated. If the order is accepted, what would be the impact on net income? a. decrease of $750 b. decrease of $6,750 c. increase of $2,250 d. increase of $1,500 ____ 3. Niva Co. Manufactures three products: Bales; Tales and Wales. The selling prices are: 55; 78; and 32 respectively. The variable costs for each product are: 20; 50; and 15, respectively. Each product must go through the same processing in a machine that is limited to 2,000 hours per month. Bales take 7 hours to process, Tales take 4 hours, and Wales take 1 hour. What is the contribution margin per machine hour for Bales? a. $7 b. $5 c. $35 d. $28 ____ 4. Jones Co. can further process Product B to produce Product C. Product B is currently selling for $30 per pound and costs $28 per pound to produce. Product C would sell for $60 per pound and would require an additional cost of $24 per pound to produce. What is the differential cost of producing Product C? a. $30 per pound b. $24 per pound c. $28 per pound d. $60 per pound Name: ________________________ ID: S 2 ____ 5. Below is a table for the present value of $1 at Compound interest. Year 6% 10% 12% 1 .943 .909 .893 2 .890 .826 .797 3 .840 .751 .712 4 .792 .683 .636 5 .747 .621 .567 Below is a table for the present value of an annuity of $1 at compound interest....
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This note was uploaded on 04/29/2010 for the course ACCT Managerial taught by Professor B.mahan during the Spring '10 term at Harold Washington College  CCC.
 Spring '10
 B.Mahan
 Accounting, Managerial Accounting

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