ACCT-331

# ACCT-331 - Fangmengya Cui ACCT-331 Prof. Wall 06/16/2011...

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Fangmengya Cui ACCT-331 Prof. Wall 06/16/2011 Multiple Choices 1. MoreForLess Company Status Quo Alternative Difference Sales Revenue \$2,000,000 \$2,200,000 \$200,000 Costs 1,500,000 1,660,000 160,000 Operating Profit \$500,000 \$540,000 \$40,000 Therefore, the differential operating profit for 2011 is \$40,000 2. Cost of Goods Purchased: Transportation-in \$6,700 Gross merchandise cost 304,000 Less Purchases discount (3,500) Purchases return (8,400) Total Cost of Goods Purchased \$298,800 4. Cost of Goods Manufacturing: Direct Materials: Beginning work-in-process inventory \$45,000 Direct Materials used in production 308,000 Less ending work-in-process inventory (67,000) Direct Labor 475,000 Manufacturing overhead 250,000 Total Cost of Goods Manufacturing \$1,011,000 5. Variable Cost Ratio = Variable Cost / Sales Revenue Sales Revenue = Selling price * Units of output If the variable cost and units of output do not change, selling price increases by 10%, the sales revenue would increase. Based on the first formula, if the sales revenue increase, and the variable

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## This note was uploaded on 06/17/2011 for the course ACCT 331 taught by Professor Wall during the Spring '11 term at Suffolk.

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ACCT-331 - Fangmengya Cui ACCT-331 Prof. Wall 06/16/2011...

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