The information below has been taken from the cost records of ABC Company
for the past year:
Raw materials purchased
Labour costs (80% Direct, 20% Indirect)
Other actual manufacturing costs
Selling and administrative expenses
Finished Goods inve
Q1. A firm faces the following demand and total cost functions:
P = 50 0.5Q
TC = 0.25 Q2 + 35Q + 25
Show that the Q, which minimizes Average Cost, also maximizes profits.
Q2. A firm faces the following demand and total cost functions:
Q = 28
1-22 Some activities in the value chain of a manufacturer of cotton
shirts are as follows:
Growing and harvesting cotton
Transporting raw materials
Weaving cotton material
Transporting shirts t
Chapter 9 Pricing
Key Topics: Target cost, Target selling price using absorption cost-plus pricing and variable costplus pricing. Time-and-material pricing to determine the cost of services provided, Transfer
price using the negotiated,
ILLUSTRATIVE MULTIPLE CHOICE QUESTIONS CH 2
1.Inventoriable cost is a cost that
a. is identified with the period in which they are incurred.
b. is either purchased or manufactured for resale.
c. is manufactured as a tooling for the plant.
d. is incurred w
Chapter 7 Incremental Analysis
Decision making process
Vary in scope, urgency, importance
Finance + non finance (unemployment, lost morale, environment, image of the company etc)
Relevant (either revenue + cost + VC + FC might change), opportunity, sun
Some activities in the value chain of a manufacturer of cotton shirts are as
(a) Growing and harvesting cotton
(b) Transporting raw materials
(c) Designing shirts
(d) Weaving cotton material
(e) Manufacturing shirts
(f ) Transporting shirts
Discussion Qs 2, 6, 7, 8, 10, 12, 14.
The Tricities Bus Company is a regional bus line providing transit service between Coquitlam, Port Moody
and Port Coquitlam. An analysis of the monthly demand for transit reveals the
Assignment #03: Suggested Answers
Ch. 4 Discussion Questions
2. (a) We can identify at least four different types of demands. These are the individual's demand
for a good or service, the market or industry demand for the good or service, the demand curve
7-44 (45 MINUTES)
Break-even point in units:
Break -even point =
unit contribution margin
Calculation of contribution margins:
Variable selling cost.
132.Seco Corp., a wholesale supply company, uses independent sales agents to market the
company's products. These agents currently receive a commission of 20% of sales, but
are demanding an increase to 25% of sales. Seco had already prepared its budget fo
Midterm Exam- Fall 2015
BUS 254 D200: Managerial Accounting
Students Name & ID : _
Time : 2 Hours
Multiple Choice .
Cost Concepts & Behaviour .
Job Order Cost Accounting .
Activity Based Costing .
1.Under variable costing, fixed manufacturing overhead is:
A. expensed immediately when incurred.
B. never expensed.
C. applied directly to Finished-Goods Inventory.
D. applied directly to Work-in-Process Inventory.
E. treated in the same manner as variab
Bus 207: Assignment #06
Textbook Ch. 8: Discussion Qs 5, 6. Textbook Ch. 9: Discussion Qs 1, 2, 3, 4, 5.
Woozles can be manufactured in either of two types of factory with the following cost
functions. A perfectly competitive manufacturer of woozles c
Examples of the four primary management activities in the
context of a national fast-food chain are as follows:
(a) Decision making: Choosing among
locations for a new fast-food outlet.
(b) Planning: Developing a cost budget for the f
1. An examination of Short Corporation's inventory accounts revealed the following
Raw materials inventory, June 1:
Raw materials inventory, June 30:
Purchases of raw materials during June:
Part II - Multiple Choice (30 marks)
Please provide your answers on the Multiple Choice Answer Sheet provided.
1. A professional managerial accountant has an ethical responsibility to take some action
when he/she becomes aware that the compan
A firm has decided through regression analysis that its sales (S) are a function of
the amount of advertising (measured in units) in two different media, television
(x) and magazines (y):
S(x, y) = 100 x2 + 30x y2 + 40y
Find the lev
BUDGETARY CONTROL AND RESPONSIBILITY
Key Topics: Static Vs Flexible Budgets Evaluating Performance: ROI & RI
Multiple Choice Questions
1. What is the preparation of reports for each level of responsibility in the c
Managerial Accounting: the process of identifying, measuring, analyzing, interpreting, communicating information in
pursuit of organizational goals.
Concerns providing information to managers
determine and develop internal accounting informatio
Chapter 2 WileyPlus Quiz: Weygandt, Managerial Accounting, Fourth Canadian Edition
1. Direct materials are
a. a product cost and manufacturing overhead, but not a period cost.
b. a product cost, but neither a manufacturing overhead nor a period cost.
BUS254 Ch2 & Ch3
Manufacturing Cost (Aka Product Cost/Inventoriable Cost):
Direct materials: traceable matter used in manufacturing a product
Raw Material: Any materials that are used in the final product and the finished product of one
company can become
Cost-volume-profit (CVP) analysis: a powerful tool that managers use to help them understand the interrelationship
among cost, volume and profit in an organization by focusing on interactions among the following five elements
prices of product
Midterm Exam- Model Question Paper
BUS 254 D200: Managerial Accounting
Students Name & ID : _
Time : 2 Hours (10:30 am- 12:30 am)
Weightage: 35 marks
The weightage of marks for the chapters may be slightly different in the actual
BUS254 Ch5 & 7
Many different products are produced each period.
Products are manufactured to order.
The unique nature of each order requires tracing or allocating costs to each job, and maintaining cost records for
22. (p. 316) Merrimaid plans to sell 1,100 units of a particular product during July, and expects
sales to increase at the rate of 5% per month during the remainder of the year. The June 30 and
September 30 ending inventories are anticipated to be 100 uni
Problem 7-46 CVP Relationships; Indifference Point (LO1, 4)
Corrigan Enterprises is studying the acquisition of two electrical component insertion systems for producing its sole
product, the universal gismo. Data relevant to the systems follow.
Problem 5-46 ABC; Cost Analysis (LO1, 2, 4, 5, 7)
Ontario, Inc. manufactures two types of medical devices, Standard and Enhanced, and applies overhead on the basis
of direct-labour hours. Anticipated overhead and direct-labour time for the upcoming accoun
Problem 7-63 Break-Even Analysis; Operating Leverage: New Manufacturing Environment
(LO1, 4, 10)
Celestial Products, Inc. has decided to introduce a new product that can be manufactured by either a computerassisted manufacturing system or a labour-intensi
PROBLEM 5-46 (30 MINUTES)
Predetermined overhead rate = budgeted overhead
budgeted direct-labor hours
= $800,000 25,000* = $32 per
direct labour hour
*25,000 budgeted direct-labor hours = (3,000 units of
Standard) (3 hrs. /unit) +
(4,000 units of Enha