Applied overhead consists of which of the following?
A. actual activity times predetermined overhead rate
B. estimated activity times predetermined overhead rate
C. actual activity times actual overhead rate
D. estimated activity times actual overhead rate
A company has a favorable variable overhead spending variance, an unfavorable
variable overhead efficiency variance, and underapplied variable overhead at the end of
a period. The journal entry to record these variances and close the variable overhead
control account will show which of the following?
A. debit credit credit
B. credit debit credit
C. debit credit debit
D. credit debit debit
Disclosing detailed financial information to all employees is a characteristic of
A. open-book management.
B. data mining.
C. diversity.
D. strategic alliance.
Which of the following fluctuate over the product life cycle?
A. sales price per unit
B. the types of costs that are incurred
C. product profitability
D. all of the above
Reed Company
Reed Company produces 50,000 units of Product Q and 6,000 units of Product Z during
a period. In that period, four set-ups were required for color changes. All units of
Product Q are black, which is the color in the process at the beginning of the period. A
set-up was made for 1,000 blue units of Product Z; a set-up was made for 4,500 red
units of Product Z; a set-up was made for 500 green units of Product Z. A set-up was
then made to return the process to its standard black coloration and the units of Product
Q were run. Each set-up costs $500.
Refer to Reed Company. Assume that Reed Company has decided to allocate overhead
costs using levels of cost drivers. What would be the approximate per-unit set-up cost
for the green units of Product Z?
A. $1.00.
B. $0.25.
C. $0.04.
D. None of the responses are correct.
The JIT philosophy indicates that inventory, as well as which of the following, should
be eliminated?
A. yes yes yes yes
B. yes yes no no
C. no no yes no
D. no yes no yes
Economic value added (EVA) applies the target rate of return to the book value of the
assets invested in a division.
Which of the following is a commonly used joint cost allocation method?
A. high-low method
B. regression analysis
C. approximated sales value at split-off method
D. weighted average quantity technique
Thunder Sports Enterprises
The Basketball Division of Thunder Sports Enterprises reported the following financial
data for the year:
Refer to Thunder Sports Enterprises. What was the Basketball Division’s segment
income?
A. $168,000
B. $125,000
C. $269,000
D. $ 19,000
Shannon Companies
Refer to Shannon Companies. For Company C, what are the budgeted cash collections?
A. $200
B. $300
C. $400
D. $500