1) lavell corporation reported the following data for the month of february:
the cost of goods sold for february was:
a.$225,000
b.$134,000
c.$184,000
d.$127,000
2) in capital budgeting, what will be the effect on the following if there is an increase in
the discount rate?
a.choice a
b.choice b
c.choice c
d.choice d
e.choice e
3) (ignore income taxes in this problem.) anne, inc., is considering the purchase of a
machine that would cost $200,000 and would last for 8 years. at the end of 8 years, the
machine would have a salvage value of $46,000. the machine would reduce labor and
other costs by $31,000 per year. additional working capital of $7,000 would be needed
immediately. all of this working capital would be recovered at the end of the life of the
machine. the company requires a minimum pretax return of 8% on all investment
projects.
the net present value of the proposed project is closest to:
a.-$21,843
b.$2,997
c.-$413
d.-$223
4) when using the indirect method to prepare the statement of cash flows, depreciation
should be presented as a(n):
a.cash flow from investing activities
b.cash flow from financing activities
c.deduction from net income
d.addition to net income
5) (ignore income taxes in this problem.) hull inc. is considering the acquisition of
equipment that costs $200,000 and has a useful life of 6 years with no salvage value.
the incremental net cash flows that would be generated by the equipment are:
if the discount rate is 18%, the net present value of the investment is closest to:
a.$24,418
b.$177,000
c.$224,418
d.$65,566
6) gorley kennel uses tenant-days as its measure of activity; an animal housed in the
kennel for one day is counted as one tenant-day. during february, the kennel budgeted
for 3,900 tenant-days, but its actual level of activity was 3,940 tenant-days. the kennel
has provided the following data concerning the formulas to be used in its budgeting:
the activity variance for administrative expenses in february would be closest to:
a.$18 u
b.$12 u
c.$18 f
d.$12 f
7) the management of dando corporation has provided the following data concerning its
two products:
the constrained resource is a particular machine that is available for 10,100 minutes
each month.
up to how much should the company be willing to pay to obtain enough of the
constrained resource to satisfy demand for the two existing products?
a.$40.00 per minute
b.$8.00 per minute
c.$4.00 per minute
d.$32.00 per minute
8) inks corporation incurred $69,000 of actual manufacturing overhead costs during
june. during the same period, the manufacturing overhead applied to work in process
was $70,000. the journal entry to record the incurrence of the actual manufacturing
overhead costs would include a:
a.debit to manufacturing overhead of $69,000
b.debit to work in process of $70,000
c.credit to manufacturing overhead of $69,000
d.credit to work in process of $70,000
9) manago corporation manufactures and sells a single product. the company uses units
as the measure of activity in its budgets and performance reports. during march, the
company budgeted for 5,300 units, but its actual level of activity was 5,310 units. the
company has provided the following data concerning the formulas to be used in its
budgeting:|
the selling and administrative expenses in the planning budget for march would be
closest to:
a.$25,640
b.$26,199
c.$26,248
d.$25,648
10) overhead allocation based solely on a measure of volume such as direct labor-hours:
a.is a key aspect of the activity-based costing model
b.will systematically overcost high-volume products and undercost low-volume
products
c.will systematically overcost low-volume products and undercost high-volume
products
d.must be used for external financial reporting
11) weisgarber clinic uses client-visits as its measure of activity. during august, the
clinic budgeted for 3,900 client-visits, but its actual level of activity was 3,850
client-visits. the clinic has provided the following data concerning the formulas to be
used in its budgeting for august:
the net operating income in the planning budget for august would be closest to:
a.$15,615
b.$15,217
c.$18,705
d.$19,670
12) jarmon company, which has only one product, has provided the following data
concerning its most recent month of operations:
the company produces the same number of units every month, although the sales in
units vary from month to month. the company’s variable costs per unit and total fixed
costs have been constant from month to month.
what is the unit product cost for the month under variable costing?
a.$78
b.$105
c.$73
d.$110
13) niesen corporation has two major business segments-consumer and commercial.
data for the segment and for the company for august appear below:
in addition, common fixed expenses totaled $282,000 and were allocated as follows:
$127,000 to the consumer business segment and $155,000 to the commercial business
segment.
a properly constructed segmented income statement in a contribution format would
show that the net operating income of the company as a whole is:
a.$110,000
b.$392,000
c.$546,000
d.-$172,000