AC 202 Study guide Chapters 20, 21, 22,23

AC 202 Study guide Chapters 20, 21, 22,23 - Chapter 20...

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Chapter 20 study guide 1. Orr Corporation's manufacturing costs for August when production was 800 units appears below: Direct material $10 per unit Direct labor $4,800 Variable overhead 4,000 Factory depreciation 3,000 Factory supervisory salaries 2,000 Other fixed factory costs 1,000 How much is the budgeted manufacturing cost for a month when 900 units are produced? A) $23,800 B) $18,900 C) $24,900 D) $25,650 2. Razmataz Company makes and sells umbrellas. The company is in the process of preparing its Selling and Administrative Expense Budget for the last half of the year. The following budget data are available: Item Variable Cost Per Uni Sales commissions $0.60 Shipping $1.20 Advertising $0.30 Depreciation on office equipment Other operating expenses $0.35 Expenses are paid in the month incurred. If the company has budgeted to sell 2,000 umbrellas in October, how much is the total budgeted variable selling and administrative expenses for October? A) $41,000 C) $45,900 B) $4,600 D) $4,900 3. At January 1, 2006, Jake, Inc. has beginning inventory of 3,000 surfboards. Jake estimates it will sell 14,000 units during the first quarter of 2006 with a 10% increase in sales each quarter. Jake's policy is to maintain an ending inventory equal to 20% of the next quarter's sales. Each surfboard costs $140 and is sold for $200. How many units should Jake produce during the first quarter of 2006? A) 14,080 C) 16,800 B) 14,000 D) 14,200
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4. Harrah Company provided the following information for the month of October: Beginning cash balance $ 35,00 Cash receipts 460,00 Cash disbursements 485,00 Harrah's policy is to keep a minimum end of the month cash balance of $30,000. How much will Harrah's need to borrow during October? A) $20,000 B) $25,000 C) $10,000 D) $0 5. Each production worker can produce 4 wooden chairs per hour. During the month of June, Chairs, Inc. has forecasted sales of 100,000 chairs. The beginning inventory was 10,000 chairs, and desired ending inventory is 2,500 chairs. How many hours of direct labor must be budgeted to meet production needs? A) 25,375 B) 25,000 C) 23,125 D) 24,625 6. Jennings Corporation manufactures two models of tires: XL and DL. Based on the following production and sales data for August 2006, prepare (a) a sales budget and (b) a production budget. XL D Estimated inventory, August 1 350 1 Desired inventory, August 31 375 1 Expected sales in units 7,500 5,2 Unit sales price $150 $1 1. C 2. D 3. A 4. A 5. C
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6. a. Jennings Corporation Sales Budget August 2006 XL (7,500 X $150) $1,125,000 DL (5,200 X $130) 676,000 Total budgeted sales $1,801,000 b. Jennings Corporation Production Budget August 2006 XL DL Ending units, August 31 375 12 Plus: Units sold 7,500 5,2 Units needed 7,875 5.3 Less: Beginning inventory, August 1 350 15 Units produced 7,525 5,17 AC 202 Chapters 21, 22, & 23 Review sheet, including chapter 23 additional practice questions 1. Kilroy Manufacturing prepared a 2007 budget for 40,000 units of product. Actual production in 2007 was 41,000 units. Which one of the following is the most useful
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This note was uploaded on 11/10/2011 for the course AC 31235 taught by Professor Gurevitz during the Spring '09 term at Montgomery College.

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AC 202 Study guide Chapters 20, 21, 22,23 - Chapter 20...

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