Exam 3 Practice - Practice Exam 3 These practice questions...

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Practice Exam 3 These practice questions do not cover every topic that may appear on the actual exam, but they should be a part of your exam preparation. You should also study your class notes, assignments, practice problems as well as the assigned reading from the textbook. Time value of money tables will be provided on the exam. 01. Which department is often responsible for a direct materials variance based on useage? A. The accounting department B. The production department C. The purchasing department D. The budgeting department 02. Capital budgeting decisions can be difficult because A. Decision may be difficult or impossible to reverse. B. Large amounts of money are usually involved. C. Investment involves a long-term commitment D. Outcome is uncertain. E. All of the above. 03. A manager of a company had budgeted to produce 150 units, costing $1,500 in variable costs and $600 in fixed costs. The actual production was 200 units costing $1,900 in variable costs and $600 in fixed costs. Overall, the manager can be said to have performed: A. Above expectations B. Below expectations C. As expected D. Cannot be determined 04. Hunt, Inc. had the following results of operations for the past year: Sales (16,000 units at $10). ...................................... $160,000 Direct materials and direct labor. .............................. $96,000 Overhead (20% variable). ......................................... 16,000 Selling and administrative expenses (all fixed). ....... 32,000 (144,000 ) Operating income. ..................................................... $ 16,000 A foreign company offers to buy 4,000 units at $7.50 per unit. Producing the additional units would increase fixed overhead by $600 and selling and administrative costs by $300. If the company accepts the offer, its profits will: A. Increase by $30,000. B. Increase by $6,000. C. Decrease by $6,000. D. Increase by $5,200. E. Increase by $4,300. 05. How long will it take an investment of $25,000 to accumulate to a total of $35,462.50 assuming an interest rate of 6 percent? A. 4 years. B. 10 years. C. 5 years. D. 6 years. E. 2 years. 06. Cobert Company’s actual sales results exceeded the planned results for July. This amount exceeded the amount of an unfavorable difference reported for June sales. Which of the following statements about the sales performance report for both months is true? A. The sales report is not useful since it shows a favorable and unfavorable difference for the two months. -- Page 1 --
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B. The differences for the two months will offset each other so the differences should not be a concern. C.
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This note was uploaded on 01/19/2012 for the course ACC 310F taught by Professor Verduzco during the Summer '07 term at University of Texas.

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Exam 3 Practice - Practice Exam 3 These practice questions...

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