1) The company’s acid-test (quick) ratio at the end of Year 2 is closest to:
A.1.96
B.1.41
C.1.20
D.1.48
2) The company’s price-earnings ratio for Year 2 is closest to:
A.0.38
B.4.53
C.5.70
D.8.11
3) The property taxes on a factory building would be an example of:
Prime Cost Conversion Cost
A) No Yes
B) Yes No
C) Yes Yes
D) No No
4) Maraby Corporation’s average sale period for Year 2 was closest to:
A.38.8 days
B.32.6 days
C.46.6 days
D.27.0 days
5) Corner Corporation is considering six jobs for the upcoming period. Those jobs are
listed below, along with relevant data.
The total amount of the constrained resource that is available during the upcoming
period is 91 hours.
Required:
a. Determine which jobs should be accepted for the upcoming period.
b. Determine the total incremental profit for the upcoming period if your plan from part
(a) above is adopted.
6) The income tax expense in year 2 is:
A.$15,000
B.$6,000
C.$9,000
D.$21,000
7) Using the high-low method of analysis, the estimated total fixed cost per month for
maintenance is closest to:
A.$440
B.$407
C.$470
D.$0
8) Leaphart 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 May, the kennel budgeted for
2,800 tenant-days, but its actual level of activity was 2,840 tenant-days. The kennel has
provided the following data concerning the formulas to be used in its budgeting:
The wages and salaries in the planning budget for May would be closest to:
A.$18,344
B.$18,606
C.$18,720
D.$18,936
9) Kosakowski Corporation processes sugar beets in batches. A batch of sugar beets
costs $66 to buy from farmers and $17 to crush in the company’s plant. Two
intermediate products, beet fiber and beet juice, emerge from the crushing process. The
beet fiber can be sold as is for $23 or processed further for $13 to make the end product
industrial fiber that is sold for $36. The beet juice can be sold as is for $42 or processed
further for $20 to make the end product refined sugar that is sold for $84. How much
more profit (loss) does the company make by processing one batch of sugar beets into
the end products industrial fiber and refined sugar?
A.$(18)
B.$4
C.$22
D.$(116)
10) The markup on absorption cost is closest to:
A.96.5%
B.15.0%
C.31.2%
D.30.0%
11) Ordway 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 June, the kennel budgeted for
2,100 tenant-days, but its actual level of activity was 2,070 tenant-days. The kennel has
provided the following data concerning the formulas used in its budgeting and its actual
results for June:
Data used in budgeting:
Actual results for June:
The facility expenses in the flexible budget for June would be closest to:
A.$19,941
B.$19,236
C.$19,375
D.$19,380
12) The net present value of the entire project is closest to:
A.$279,496
B.$119,496
C.$208,000
D.$204,560
13) Last year Cumberland Corporation reported a cost of goods sold of $120,000.
Inventories increased by $35,000 during the year, and accounts payable increased by
$20,000. The company uses the direct method to determine the net cash provided by
operating activities on the statement of cash flows. The cost of goods sold adjusted to a
cash basis would be:
A.$135,000
B.$100,000
C.$155,000
D.$105,000