bu_247_practice_exam_09-2

bu_247_practice_exam_09-2 -...

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MULTIPLE CHOICE.  Choose the one alternative that best completes the statement or answers the question.  The Chou Company provided the following information regarding its one and only product, rollers: Direct labour $45,000 Direct materials used 30,000 Fixed factory overhead 42,000 Fixed selling and administrative expenses 8,000 Variable factory overhead 28,000 Variable selling and administrative expenses 12,000 Selling price per unit 20 Units produced and sold 10,000 1) 
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The unit  cost of a  roller  under the  absorptio approach  is 
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1) 
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_______  A) 
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$16.50. 
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B) 
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$11.50. 
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C) 
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$5.00. 
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D)  $ 1  
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The  predicted  future  costs and  revenues  that will  differ  among  alternativ e courses  of action  are  referred  to as 
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2)  ____ ___ 
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predictable  information. 
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B)  rel eva
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historical  information. 
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D)  sun k  revenues.    Avey Corporation has a joint  process which produces three  products, M, L and B. Each  product may be sold at split - off  or processed further and then  sold. Joint processing costs for  a year amount to $500,000.  Other relevant data are as  follows: Separable Processing Sales Value Costs after Sales Value Product at Split     -   off      Split     -   off         at Completion M $640,000 $80,000 $800,000 L 250,000 130,000 380,000 B 128,000 100,000 200,000 3) 
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Once  product  M is  produced,  processin g it  further  will cause  profits to 
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3)  ____ ___ 
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decrease by  $160,000. 
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B)  inc reas
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increase by  $160,000. 
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D)  dec reas   Barker Company produces a  part that is used in the  manufacture of one of its  products. The costs associated  with the production of 5,000  units of this part are as follows: Direct materials $  90,000 Direct labour 130,000 Variable factory overhead 60,000 Fixed factory overhead 140,000 Total costs $420,000 Of the fixed factory overhead  costs, $60,000 is avoidable. 4) 
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Assuming  no other  use of  their  facilities,  the  highest  price that  Barker  should be  willing to  pay for  5,000  units of  the part is 
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4)  ____ ___ 
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$420,000. 
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B) 
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$340,000. 
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C) 
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$240,000. 
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D)  $ 2   Pett  Company  produces  a part that  is used in  the  manufactu re of one  of its  products.  The costs  associated  with the  productio n of 5,000  units of  this part  are as  follows: Direct  materials 22,500  Direct  labour 32,500  Variable  factory  overhead 15,000  Fixed  factory  overhead 35,000   Total  costs $105,000   Of the  fixed  factory  ov er he ad  co sts $1 5, 00 is  av oi da bl e.
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bu_247_practice_exam_09-2 -...

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