ca_exm_ma1_2006-12

ca_exm_ma1_2006-12 - CGA-CANADA MANAGEMENT ACCOUNTING 1...

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EMA1D06 ©CGA-Canada, 2006 Page 1 of 7 CGA-CANADA MANAGEMENT ACCOUNTING 1 EXAMINATION December 2006 Marks Time: 3 Hours Note: Except for multiple-choice questions, all calculations must be shown to obtain full marks. 30 Question 1 Select the best answer for each of the following unrelated items. Answer each of these items in your examination booklet by giving the number of your choice. For example, if the best answer for item (a) is (1), write (a)(1) in your examination booklet. If more than one answer is given for an item, that item will not be marked. Incorrect answers will be marked as zero. Marks will not be awarded for explanations. Note: 3 marks each a. Which of the following statements best describes an opportunity cost? 1) A cost that has already been incurred and cannot be recovered, regardless of decisions made in the present or future 2) A cost that exists under one proposed course of action but not under another 3) A cost not closely identified with a particular output that must be shared by all of the outputs benefiting from the cost 4) A cost that is a benefit lost when assets are employed in some other way b. If overhead cost is underapplied for a period, which of the following statements is true? 1) The predetermined overhead rate used to apply overhead cost to work in process was too high. 2) The company incurred less overhead cost than it charged to work in process. 3) Too little overhead cost has been assigned to jobs. 4) Too much overhead cost has been assigned to jobs. c. In the month of May, ABC Company produced 6,000 units of a product. The standard cost card indicates the following materials standard per unit of output: 1 kilogram @ $0.5 = $0.50. During May, 16,000 kilograms of material were purchased at a total cost of $7,800. What is the material’s price variance for May? 1) $200 unfavourable 2) $200 favourable 3) $8,000 unfavourable 4) $8,000 favourable d. A company considers producing a new product and selling 20,000 units per year at a selling price of $60 per unit. It will cost $800,000 to design, develop, and produce the units. If the company desires a 16% return on investment, what is the target cost per unit? 1) $ 6.40 2) $ 9.60 3) $ 40.20 4) $ 53.60 Continued. ..
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EMA1D06 ©CGA-Canada, 2006 Page 2 of 7 Note: Use the following information to answer parts (e) and (f). Last month, the painting department of Surfaces Company started 20,000 units into production. The department had 6,000 units in process at the beginning of the month and these were 30% complete with respect to conversion costs. There were 8,000 units in process at the end of the month, which were 40% complete with respect to conversion costs. A total of 18,000 units were completed and transferred to the next department during the month. e.
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This note was uploaded on 11/15/2010 for the course CGA ma1 taught by Professor ... during the Spring '10 term at York Tech.

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ca_exm_ma1_2006-12 - CGA-CANADA MANAGEMENT ACCOUNTING 1...

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