Diversity among employees leads to increased employee turnover.
An organization’s profitability is an example of a lag indicator.
Grade refers to a product meeting the highest number of a customer’s needs at the
lowest possible cost.
Calculations for standard process costing are identical to those for weighted average
process costing.
Favorable variances are always desirable for production.
When manufacturing overhead is charged to a job, the work in process account is
debited.
In order to assure achievement of an organizational goal, performance measures must
be established for that goal.
Break-even point may be expressed in terms of units or dollars.
The financial perspective of the balanced scorecard addresses stakeholder concerns
about profitability and organizational growth.
Activity based costing is most effective when it is implemented in an environment that
supports total quality management
It is least likely that a production budget revision would cause a revision in the
A. capital budget.
B. cash budget.
C. purchases budget.
D. pro forma balance sheet.
When allocating joint process cost based on tons of output, all products will
A. be salable at split-off.
B. have the same joint cost per ton.
C. have a sales value greater than their costs.
D. have no disposal costs at the split-off point.
Ultralinear Electronics Corporation
Ultralinear Electronics Corporation manufactures and sells FM radios. Information on
the prior year’s operations (sales and production Model A1) is presented below:
Refer to Ultralinear Electronics Corporation. Assume that the remaining Model A1
radios can be sold through normal channels or to a foreign buyer for $6 per unit. If sold
through regular channels, the minimum acceptable price will be
A. $30.
B. $33.
C. $10.
D. $4.
The following costs were accumulated by Department 2 of Joplin Company during
November:
Production for November in Department 2 (in units):
Materials are not added in Department 2 until the very end of processing Department 2.
Required: Compute the cost of units completed and the value of ending WIP for:
Tactical planning usually involves which level of management?
A. middle
B. top
C. middle and top
D. operational
Industrial Solutions Company
Industrial Solutions Company manufactures a cleaning solvent. The company employs
both skilled and unskilled workers. To produce one 55-gallon drum of solvent requires
Materials A and B as well as skilled labor and unskilled labor. The standard and actual
material and labor information is presented below:
Standard:
Material A: 30.25 gallons @ $1.25 per gallon
Material B: 24.75 gallons @ $2.00 per gallon
Skilled Labor: 4 hours @ $12 per hour
Unskilled Labor: 2 hours @ $ 7 per hour
Actual:
Material A: 10,716 gallons purchased and used @ $1.50 per gallon
Material B: 17,484 gallons purchased and used @ $1.90 per gallon
Skilled labor hours: 1,950 @ $11.90 per hour
Unskilled labor hours: 1,300 @ $7.15 per hour
During the current month Industrial Solutions Company manufactured 500 55-gallon
drums.
Round all answers to the nearest whole dollar.
Refer to Industrial Solutions Company. What is the total material mix variance?
A. $3,596 F
B. $3,596 U
C. $4,864 F
D. $4,864 U
Commodore Company
Commodore Company uses a standard cost system for its production process and
applies overhead based on direct labor hours. The following information is available for
September when Commodore produced 5,000 units:
Refer to Commodore Company. Using the four-variance approach, what is the variable
overhead spending variance?
A. $2,525U
B. $4,075 F
C. $4,075 U
D. $4,325 U
Bradley Corporation
Bradley Corporation has three production departments A, B, and C. Bradley
Corporation also has two service departments, Administration and Personnel.
Administration costs are allocated based on value of assets employed, and Personnel
costs are allocated based on number of employees. Assume that Administration
provides more service to the other departments than does the Personnel Department.
Refer to Bradley Corporation. Using the direct method, what amount of Administration
costs is allocated to A (round to the nearest dollar)?
A. $216,000
B. $150,000
C. $288,000
D. $54,000
Ellis Retail
Ellis Retail is considering an investment in a delivery truck. Ellis has found a used truck
that he can purchase for $8,000. He estimates the truck would last six years and
increase his store’s net cash revenues by $2,000 per year. At the end of six years, the
truck would have no salvage value and would be discarded. Ellis will depreciate the
truck using the straight-line method.
Refer to Ellis Retail. What is the accounting rate of return on the truck investment
(based on average profit and average investment)?
A. 25.0%
B. 50.0%
C. 16.7%
D. 8.3%
Kilpatrick Company manufactures products A and B from a joint process. Sales value
at split-off was $700,000 for 10,000 units of A, and $300,000 for 15,000 units of B.
Using the sales value at split-off approach, joint costs that Kilpatrick allocated to A
were $140,000. Total joint costs were
A. $ 98,000.
B. $200,000.
C. $233,333.
D. $350,000.
_________________________ refers to the number of products made.
Costs that can be conveniently traced to a cost object are referred to as
____________________ costs.
The point at which individual products are first identifiable in a joint process is referred
to as the _________________________.
What are three reasons that overhead must be allocated to products?
Describe the lowest internal transfer price that an autonomous division manager of an
investment center would consider accepting for a product that his/her division
produces.
When is a hybrid costing system appropriate in a manufacturing setting?
Define business process reengineering (BPR).