1) The following data have been provided by Mathews Corporation:
Lubricants and supplies are both elements of variable manufacturing overhead.
The variable overhead rate variance for lubricants is closest to:
A.$1,376 F
B.$516 U
C.$860 F
D.$1,376 U
2) The contribution margin for July is:
A) $534,600
B) $699,300
C) $359,900
D) $1,453,400
3) Blier Corporation has provided the following information concerning a capital
budgeting project:
The company uses straight-line depreciation on all equipment.
The income tax expense in year 2 is:
A.$17,500
B.$3,500
C.$35,000
D.$21,000
4) The margin of safety is:
A.the excess of budgeted or actual sales over budgeted or actual variable expenses.
B.the excess of budgeted or actual sales over budgeted or actual fixed expenses.
C.the excess of budgeted or actual sales over the break-even volume of sales.
D.the excess of budgeted net operating income over actual net operating income.
5) The accounts receivable turnover for Year 2 is closest to:
A.1.10
B.0.91
C.11.52
D.12.10
6) Which product makes the LEAST profitable use of the milling machines?
A) Product A
B) Product B
C) Product C
D) Product D
7) The adjusted cost of goods sold that appears on the income statement for July is:
A.$201,000
B.$198,000
C.$219,000
D.$210,000
8) Kudej Printing uses two measures of activity, press runs and book set-ups, in the cost
formulas in its budgets and performance reports. The cost formula for wages and
salaries is $8,360 per month plus $570 per press run plus $910 per book set-up. The
company expected its activity in May to be 194 press runs and 74 book set-ups, but the
actual activity was 195 press runs and 72 book set-ups. The actual cost for wages and
salaries in May was $188,370.
The wages and salaries in the planning budget for May would be closest to:
A.$185,030
B.$188,370
C.$187,404
D.$186,280
9) If the level of activity increases within the relevant range:
A) variable cost per unit and total fixed costs also increase.
B) fixed cost per unit and total variable cost also increase.
C) total cost will increase and fixed cost per unit will decrease.
D) variable cost per unit and total cost also increase.
10) The Murray Corporation makes and sells a single product. The company recorded
the following activity and cost data for May:
The fixed component of the predetermined overhead rate is $0.95 per direct labor-hour.
The fixed manufacturing overhead used to calculate the predetermined overhead rate
was:
A.$64,125
B.$67,500
C.$68,400
D.$70,275
11) Jackson Industries uses a standard cost system in which direct materials inventory is
carried at standard cost. Jackson has established the following standards for one unit of
product.
During May, Jackson purchased 125,000 pounds of direct material at a total cost of
$475,000. The total factory wages for May were $364,000, 90 percent of which were
for direct labor. Jackson manufactured 22,000 units of product during May using
108,000 pounds of direct material and 28,000 direct labor-hours.
The materials quantity variance for May is:
A.$7,200 Unfavorable
B.$7,600 Favorable
C.$5,850 Unfavorable
D.$7,200 Favorable