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Test bank to accompany jiambalvo managerial

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Test Bankto accompany JiambalvoManagerial Accounting,6th EditionEXERCISES164.Galvin Production is beginning the budgeting process for 2020. The sales forecast forthe first three months of 2020 in units follows:January10,000February14,000March12,000The company desires to have 10% of the next month’s anticipated unit sales in inventoryat the end of a month. December’s ending inventory reflects this policy. April’s sales arebudgeted at 15,000 units. Prepare a production budget in good form for February. Omitthe heading.AnswerSales14,000Plus desired ending inventory (10% × 12,000)1,200Total units needed15,200Less beginning inventory (10% × 14,000)(1,400)Units to be produced13,800Ans: N/A, LO: 2, Bloom: AP, Difficulty: Medium, Min: 1, AACSB: Analytic, AICPA FN: Measurement Analysis andInterpretation, AICPA PC: Decision Making, IMA: Decision Analysis165.Swisher Toys is preparing its budget for 2020. Production for the first quarter is expectedto be 600,000 toy dump trucks. Production for the subsequent quarters will be 625,000trucks, 700,000 trucks, and 850,000 trucks.Each truck requires 3.0 pounds of resin, which is used to produce the trucks.Each pound of resin costs $0.50. Swisher will have 325,000 pounds of resin on hand atthe end of 2020 and wants to have 500,000 pounds of resin in inventory at the end of2021. Ending inventory for resin for the first, second, and third quarters will be 340,000pounds, 360,000 pounds, and 450,000 pounds. Prepare the direct materials budget byquarter and in total for 2021.AnswerFirstSecondThirdFourthTotalQuarterQuarterQuarterQuarterYearProduction600,000625,000700,000850,0002,775,000Pounds required per unit33333Pounds used in production1,800,0001,875,0002,100,0002,550,0008,325,000Plus desired ending inventory340,000360,000450,000500,000500,000Total amount needed2,140,0002,235,0002,550,0003,050,0008,825,000Less beginning inventory325,000340,000360,000450,000325,000Amount to be purchased1,815,0001,895,0002,190,0002,600,0008,500,000Cost per pound$0.50$0.50$0.50$0.50$0.50Budgeted purchases$907,500$947,500$1,095,000$1,300,000$4,250,000Ans: N/A, LO: 2, Bloom: AP, Difficulty: Medium, Min: 1, AACSB: Analytic, AICPA FN: Measurement Analysis andInterpretation, AICPA PC: Decision Making, IMA: Decision Analysis10-64
Chapter 10Budgetary Planning and Control166.Captain Fizzy plans to produce 800,000 fizzy drinks during 2020, with 120,000 of themduring the first quarter, 250,000 during the second quarter, 220,000 during the thirdquarter, and 210,000 during the fourth quarter. Employees are paid $13.50 per hour andcan produce 200 fizzy drinks each hour. Determine Captain Fizzy’s direct labor budgetfor the third quarter of 2020.AnswerDirect labor budget = (220,000 ÷ 200) × $13.50 = $14,850Ans: N/A, LO: 2, Bloom: AP, Difficulty: Medium, Min: 1, AACSB: Analytic, AICPA FN: Measurement Analysis andInterpretation, AICPA PC: Decision Making, IMA: Decision Analysis167.Martinez Corporation's sales of gizmos are 25% for cash and 75% on credit. Pastcollection history indicates that credit sales are collected as follows:Month of SaleMonth After SaleSecond Month After SaleUncollectible30%50%15%5%In January, sales were $80,000 and February sales were $70,000. Projected sales forMarch are 3,000 gizmos at $13 each. Projected sales for April are 4,000 gizmos at $14each. Calculate the budgeted cash collections for April.

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Term
Spring
Professor
EdwardJ.Marecki
Tags
Jiambalvo Managerial Accounting

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