Calculations for standard process costing are identical to those for FIFO process
costing.
A company that produces sugar will use a job-order costing system to track production
costs.
It is not necessary to be familiar with an organization’s mission when designing a cost
management system.
Increasing automation generally results in cost management becoming more long-term
in nature.
The FIFO method combines beginning inventory and current production to compute
cost per unit of production.
Net realizable value is considered to be the best measure of the expected contribution of
each product to the coverage of joint costs.
If the cost of an additive is $5,000 + $0.50 for every unit of solvent produced, the cost
is classified as a mixed cost.
A one-variance approach calculates only a total overhead variance.
Depreciation expense provides a tax shield against the payment of taxes.
If overapplied factory overhead is material, the account is closed by a credit to Cost of
Goods Sold.
Strategic planning is focused on long-range goals of five to ten years.
If incremental revenues beyond split-off are less than incremental costs, a product
should be sold at the split-off point.
For the month of March, Robertson Corporation. predicts total cash collections to be
$1.5 million. Also for March, Robertson Corporation. estimates that its beginning cash
balance will be $60,000 and that it will borrow cash in the amount of $80,000. If
Robertson Corporation. estimates an ending cash balance of $40,000 for March, what
must its projected cash disbursements be?
A. $1,520,000
B. $1,580,000
C. $1,600,000
D. $1,640,000
Stillwater Corporation
The following information is available for Stillwater Corporation for the current year:
All materials are added at the start of production.
Refer to Stillwater Corporation. Using FIFO, what are equivalent units for material?
A. 75,000
B. 72,500
C. 84,500
D. 70,000
Broncho Lids Corporation manufactures a western-style hat that sells for $10 per unit.
This is its sole product and it has projected the break-even point at 50,000 units in the
coming period. If fixed costs are projected at $100,000, what is the projected
contribution margin ratio?
A. 80 percent
B. 20 percent
C. 40 percent
D. 60 percent
If a cost is irrelevant to a decision, the cost could not be
A. a sunk cost.
B. a future cost.
C. a variable cost.
D. an incremental cost.
The rate of interest that produces a zero net present value when a project’s discounted
cash operating advantage is netted against its discounted net investment is the
A. cost of capital.
B. discount rate.
C. cutoff rate.
D. internal rate of return.
Shannon Companies
Refer to Shannon Companies. For Company B, what are the budgeted cash
disbursements?
A. $600
B. $700
C. $500
D. $400
Levine Company
Levine Company has a job-order costing system and an overhead application rate of
125 percent of direct labor cost. Job #123 is charged with direct material of $18,000 and
overhead of $9,000. Job #124 has direct material of $4,500 and direct labor of $12,000.
Refer to Levine Company. What amount of direct labor cost has been charged to Job
#123?
A. $ 7,200
B. $ 9,000
C. $11,250
D. $18,000
A logical structure of activities designed to analyze and evaluate management of
expenditures is a cost
A. consciousness system.
B. understanding system.
C. avoidance system.
D. control system.
Modern management accounting can be characterized by its
A. flexibility.
B. standardization.
C. complexity.
D. precision.
Jenkins Manufacturing
The following information is available for Jenkins Manufacturing Company for the
month of June when the company produced 2,100 units:
Refer to Jenkins Manufacturing Company. What is the labor rate variance?
A. $1,575 U
B. $1,575 F
C. $1,594 U
D. $0
Deferred compensation techniques are currently used in the American work place.
What are they and how do they benefit the employer and the employee?
Can the performance evaluation measures (for autonomous subunit managers) create
goal congruence problems in transfer pricing situations? Explain.
What are the four tenets of total quality management (TQM)?
Mobile Corporation
Mobile Corporation is a manufacturer of electronic blood pressure monitors for
home use. The following is a summary of quality costs for the first year of operations.
Refer to Mobile Corporation. Compute the cost of processing customer returns.
Under what circumstances is the sum of variable production and selling costs the
appropriate minimum price for special orders?
The balanced scorecard perspective that addresses things that an organization needs to
do well to meet customer needs and expectations is the
______________________________ perspective.
The plan in which an organization indicates how it will fulfill its goals is referred to as
a ____________________.