1) A company manufactures coats in a large facility. One area in the production facility
is an underused storage space. The company has twice turned down offers to lease out
this facility. This situation is an example of what costing concept? How should the
company handle the costing for this situation?
2) The fourth step in accounting for production activity in a period is to prepare a cost
reconciliation, which reconciles _____________________ with the
___________________.
3) What are the difference(s) between the periodic and the perpetual inventory systems?
4) A company is setting up a sinking fund to pay off $8,654,000 in bonds that are due in
7 years. The fund will earn 7% interest, and the company intends to put away a series of
equal year-end amounts for 7 years. What is the amount of the annual deposits that the
company must make?
5) Employer payroll taxes are an added employee _______________ beyond the wages
and salaries earned by the employees.
6) Big Bend Co. fixed budget for the year is shown below:
Prepare a flexible budget for Big Bend Co. that shows a detailed budget for its actual
sales volume of 42,000 units. Use the contribution margin format.
7) A __________________ journal is used to record and post transactions of similar
type.
8) A ____________________ contains features of both process and job order
operations.
9) __________________________ are investments in securities that are not readily
convertible to cash, or are not intended to be converted to cash in the short-term.
10) Explain how to calculate times interest earned. Explain how it is used to analyze a
company’s risk.