1) the contribution margin per machine hour is calculated as:
a.full cost per unit number of machine-hours per unit
b.number of machine-hours per unit full-cost per unit
c.selling price per unit less variable manufacturing cost per unit
d.selling price per unit less variable manufacturing cost per unit less variable selling
cost per machine-hour
e.selling price per unit less total variable cost per unit, divided by number of
machine-hours per unit
2) which one of the following is the amount of factory overhead applied that exceeds
the actual factory overhead cost?
a.factory overhead applied
b.actual factory overhead
c.overapplied overhead
d.allocated factory overhead
e.underapplied overhead
3) the primary focus of job costing in service industries is on:
a.direct materials
b.direct labor
c.indirect materials
d.supplies
e.factory overhead
4) premium beds is a retailer of luxury bed frames located in los angeles, california. due
to a recent industry-wide financial crisis, the cfo of premium beds fears a significant
drop in the firm’s upcoming income stream. the cfo asked you to use the company
financial information provided below.
the annual breakeven point in unit sales is calculated to be:
a.1,600 units
b.2,000 units
c.3,400 units
d.1,300 units
e.2,600 units
5) which of the following is not an alternative approach to traditional budgeting
practices?
a.kaizen budgeting
b.zero-based budgeting (zbb)
c.activity-based budgeting (abb)
d.time-driven activity based budgeting (tdabb)
e.operations budgeting
6) the degree of operating leverage (dol), at any sales volume, is equal to:
a.(operating profit – fixed expenses) sales
b.(sales – variable expenses) operating profit
c.operating profit (fixed expenses – variable expenses)
d.sales (fixed expenses – operating profit)
e.fixed costs total contribution margin
7) all the following are characteristic of relevant costs except:
a.they are generally variable
b.they are not committed
c.they are different in amount for different options
d.they are costs that will be incurred in the future
e.they are inventory-related costs
8) sheen co. manufacturers laser printers. it has outlined the following overhead cost
drivers:
sheen co. has an order for 1,000 laser printers that has the following production
requirements:
using activity-based costing, applied materials handling factory overhead for the 1,000
laser printers order is:
a.$7,800
b.$10,000
c.$10,500
d.$150
e.$21,600
9) which of the following is not a benefit of using a lean manufacturing system?
a.lead times are reduced
b.average inventory is decreased
c.productivity is improved
d.production operations are linked in a smooth, uninterrupted flow
e.products, on average, have less variety
10) burmer co. has accumulated data to use in preparing its annual profit plan for the
upcoming year. the cost behavior pattern of the maintenance costs must be determined.
data regarding the machine hours and maintenance costs for the last year and the results
of the regression analysis are as follows:
a staff assistant has run regression analyses on the data and obtained the following
output using excel:
regression analysis
y (dependent) variable: maintenance cost
x (independent) variable: maintenance hours
the statistic that indicates precision of the regression is:
a..9982
b.47.0630
c.0.9981
d.lower 95% and upper 95%
e.significance f (1.44e-13)
11) the major limitation of volume-based costing systems is the use of volume-based:
a.criteria
b.standards
c.rates
d.variances
e.restrictions
12) two aspects to consider when selecting the time period for cost estimation are:
a.length of time period and unknown time periods
b.mismatched time periods and length of time period
c.multicollinearity and correlation
d.time periods and correlation between time periods
13) purchase order, set-up, and inspection costs are examples of:
a.unit-level costs
b.batch-level costs
c.product-level costs
d.facility-level costs
e.department-level costs
14) harmon inc. produces joint products l, m, and n from a joint process. information
concerning a batch produced in may at a joint cost of $75,000 was as follows:
the amount of joint costs allocated to product m using the physical measure method is
(calculate all ratios and percentages to 4 decimal places, for example 33.3333%, and
round all dollar amounts to the nearest whole dollar):
a.$23,438
b.$33,434
c.$40,313
d.$27,109
e.$11,250
15) general manufacturing expects to have 40,000 pounds of raw materials inventory on
hand on june 30, the end of the current year. the company has budgeted the following
production for the first four months of the coming year:
for the budgeting period, the firm desires each month’s ending raw materials inventory
to be 20% of the next month’s production needs. a finished unit requires two pounds of
raw materials.
general manufacturing’s budgeted purchases of materials during september should be:
a.60,000 lbs
b.228,000 lbs
c.248,000 lbs
d.284,000 lbs
e.300,000 lbs
16) when managers produce value for the customer, their orientation consists of all the
following except:
a.quality and service
b.timeliness of delivery
c.the ability to respond to the customer’s desire for specific features
d.state of the art manufacturing facilities
17) all of the following represent alternative approaches to the traditional
budget-preparation process except which one?
a.master budgeting
b.kaizen budgeting
c.continuous-improvement budgeting
d.activity-based budgeting (abb)
e.time-driven activity based budgeting (tdabb)
18) pasternik company produces and sells two products, alpha and zeta. the following
information is available relating to its setup activities:
assume the cost per setup remains at $2,000 but that the batch size for product alpha is
changed from 10 to 25 units per batch. using activity-based and a volume-based
overhead costing that uses direct labor-hours to assign overhead, the amount of setup
cost applied to each unit of product alpha would be (rounded to the nearest cent):
a.option a
b.option b
c.option c
d.option d
e.none of the above answers is correct
19) which of the following is not among the management accounting profession’s
response to changes in the contemporary business environment?
a.introduction of the balanced scorecard
b.value chain analysis
c.advances in costing, including activity-based costing
d.the introduction of business process improvement
e.new forms of management organization