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1) tenicheff corporation uses the fifo method in its process costing system. operating
data for the curing department for the month of march appear below:
according to the company's records, the conversion cost in beginning work in process
inventory was $10,250 at the beginning of march. the cost per equivalent unit for
conversion costs for march was $2.40.
how much conversion cost would be assigned to the units completed and transferred out
of the department during march?
a.$134,880
b.$117,600
c.$135,290
d.$125,040
2) niforos air uses two measures of activity, flights and passengers, in the cost formulas
in its budgets and performance reports. the cost formula for plane operating costs is
$41,380 per month plus $2,282 per flight plus $14 per passenger. the company expected
its activity in august to be 77 flights and 264 passengers, but the actual activity was 78
flights and 261 passengers. the actual cost for plane operating costs in august was
$216,740. the plane operating costs in the flexible budget for august would be closest
to:
a.$220,790
b.$223,030
c.$223,657
d.$216,740
3) rappaport corporation reported the following data for the month of february:
the adjusted cost of goods sold that appears on the income statement for february is:
a.$240,000
b.$238,000
c.$239,000
d.$237,000
4) moorhouse clinic uses client-visits as its measure of activity. during december, the
clinic budgeted for 3,700 client-visits, but its actual level of activity was 3,690
client-visits. the clinic has provided the following data concerning the formulas used in
its budgeting and its actual results for december:
the revenue variance for december would be closest to:
a.$3,680 u
b.$3,429 f
c.$3,429 u
d.$3,680 f
5) (ignore income taxes in this problem.) highpoint, inc., is considering investing in
automated equipment with a ten-year useful life. managers at highpoint have estimated
the cash flows associated with the tangible costs and benefits of automation, but have
been unable to estimate the cash flows associated with the intangible benefits. using the
company's 10% discount rate, the net present value of the cash flows associated with
just the tangible costs and benefits is a negative $184,350. how large would the annual
net cash inflows from the intangible benefits have to be to make this a financially
acceptable investment?
a.$18,435
b.$30,000
c.$35,000
d.$37,236
6) edward company uses the fifo method in its process costing system. the first
processing department, the welding department, started the month with 10,000 units in
its beginning work in process inventory that were 40% complete with respect to
conversion costs. the conversion cost in this beginning work in process inventory was
$12,800. an additional 94,000 units were started into production during the month. there
were 14,000 units in the ending work in process inventory of the welding department
that were 80% complete with respect to conversion costs. a total of $286,740 in
conversion costs were incurred in the department during the month.
what would be the cost per equivalent unit for conversion costs? (round off to three
decimal places.)
a.$2.880
b.$3.200
c.$2.950
d.$3.050
7) dwelmont hotel bases its budgets on guest-days. the hotel's static budget for may
appears below:
the total cost at the activity level of 2,800 guest-days per month should be:
a.$95,200
b.$86,230
c.$85,300
d.$78,200
8) bawcutt company, which has only one product, has provided the following data
concerning its most recent month of operations:
what is the unit product cost for the month under absorption costing?
a.$62
b.$93
c.$97
d.$66
9) ieso company's total fixed expenses for the year were:
a.$40,000
b.$100,000
c.$140,000
d.$170,000
10) maxwell company has a total expense per unit of $2.00 per unit at the 16,000 level
of activity and total expense per unit of $1.95 at the 21,000 unit level of activity.
the best estimate of the total fixed cost per period for maxwell company is:
a.$40,950
b.$32,000
c.$3,360
d.$29,190
11) rapone corporation's maintenance department provides services to the company's
two operating divisions-the paints division and the stains division. the variable costs of
the maintenance department are budgeted based on the number of cases produced by
the operating departments. the fixed costs of the maintenance department are budgeted
based on the number of cases produced by the operating departments during the peak
period. data appear below:
for performance evaluation purposes, how much maintenance department cost should
be charged to the paints division at the end of the year?
a.$261,600
b.$396,000
c.$277,200
d.$220,000
12) erdmann corporation has provided its contribution format income statement for july.
the company produces and sells a single product.
if the selling price is reduced by 5%, variable expenses reduced by $1.00, and fixed
expenses increased to a total of $38,400, how many units would need to be sold to earn
a net operating income of $21,000?
a.1,000
b.2,700
c.1,700
d.2,950
13) lowler corporation uses the weighted-average method in its process costing system.
data concerning the first processing department for the most recent month are listed
below:
note: your answers may differ from those offered below due to rounding error. in all
cases, select the answer that is the closest to the answer you computed. to reduce
rounding error, carry out all computations to at least three decimal places.
the cost per equivalent unit for conversion costs for the first department for the month is
closest to:
a.$46.62
b.$43.26
c.$44.40
d.$37.66
14) vandall corporation manufactures and sells a single product. the company uses units
as the measure of activity in its budgets and performance reports. during april, the
company budgeted for 7,300 units, but its actual level of activity was 7,340 units. the
company has provided the following data concerning the formulas used in its budgeting
and its actual results for april:
the spending variance for manufacturing overhead in april would be closest to:
a.$1,600 u
b.$1,648 f
c.$1,600 f
d.$1,648 u
15) noskey corporation's budgeted cash collections in july from june credit sales are:
a.$144,000
b.$136,800
c.$96,000
d.$91,200
16) michetti corporation applies manufacturing overhead to products on the basis of
standard machine-hours. budgeted and actual overhead costs for the month appear
below:
the company based its original budget on 4,300 machine-hours. the company actually
worked 4,140 machine-hours during the month. the standard hours allowed for the
actual output of the month totaled 4,200 machine-hours. what was the overall fixed
manufacturing overhead budget variance for the month?
a.$660 favorable
b.$660 unfavorable
c.$850 unfavorable
d.$850 favorable
17) data concerning plaxco corporation's single product appear below:
what is the margin of safety in dollars?
a.$4,875,000
b.$3,607,500
c.$3,250,000
d.$1,267,500
18) the management of cerruto corporation has provided the following data concerning
its two products:
the constrained resource is a particular machine that is available for 9,600 minutes each
month.
how many units of product u87d should be produced each month?
a.500
b.250
c.988
d.0
19) lindgren corporation's most recent comparative balance sheet appears below:
no plant and equipment was disposed of during the year. the free cash flow for the year
was:
a.$68
b.$15
c.($9)
d.$6
