ACCT 627 Test 2

subject Type Homework Help
subject Pages 5
subject Words 847
subject Authors Charles T. Horngren, Madhav V. Rajan, Srikant M. Datar

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1) Pearl Lights sells only pearl necklaces. 8,000 units were sold resulting in $240,000 of
sales revenue, $60,000 of variable costs, and $40,000 of fixed costs. The breakeven
point in total sales dollars is ________.
A) $40,000
B) $53,334
C) $100,000
D) $58,334
2) Which of the following is an objective of value engineering?
A) to reduce cost by eliminating all value-added activities
B) to streamline and add non-value added activities
C) to reduce the total cost of the product
D) to understand competitors' product design
3) Genent Industries, Inc. (GII), developed standard costs for direct material and direct
labor. In 2015, GII estimated the following standard costs for one of their major
products, the 30-gallon heavy-duty plastic container.
During July, GII produced and sold 3,000 containers using 1,000 pounds of direct
materials at an average cost per pound of $19 and 625 direct manufacturing labor hours
at an average wage of $11.75 per hour.
The direct manufacturing labor price variance during July is ________.
A) $375.00 unfavorable
B) $156.25 favorable
C) $243.75 favorable
D) $1,000 unfavorable
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4) Which of the following is true of goal congruence?
A) It exists when the management's strategy is in line with the shareholders'
requirements.
B) It exists when individuals and groups work toward achieving the organization's
goals.
C) It exists when both internal and external stakeholders of an organization have similar
goals.
D) It exists when an organization's goals are in line with the social acceptability of
organizational goals.
5) When a single manufacturing process yields two products, one of which has a
relatively high sales value compared to the other, the two products are respectively
known as ________.
A) joint products and byproducts
B) joint products and scrap
C) main products and byproducts
D) main products and joint products
6) The seller of a product has no idle capacity and can sell all it can produce at $39 per
unit. Outlay cost is $9. What is the opportunity cost, assuming the seller sells
internally?
A) $9
B) $30
C) $39
D) $48
7) The single-rate cost-allocation method may base the denominator choice on
________.
A) master-budget capacity utilization
B) fixed cost utilization
C) variable cost utilization
D) direct-cost utilization
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8) ________ identifies an estimated price customers are willing to pay and then
computes the cost to be achieved to earn the desired profit.
A) Cost-plus pricing
B) Target costing
C) Kaizen costing
D) Peak-load costing
9) Whitman Printing has contracts to complete weekly supplements required by
forty-six customers. For the year 20X5, manufacturing overhead cost estimates total
$840,000 for an annual production capacity of 12 million pages.
For 2010, Whitman Printing decided to evaluate the use of additional cost pools. After
analyzing manufacturing overhead costs, it was determined that number of design
changes, setups, and inspections are the primary manufacturing overhead cost drivers.
The following information was gathered during the analysis:
During 2010, two customers, Money Managers and Hospital Systems, are expected to
use the following printing services:
When costs are assigned using the single cost driver, number of pages printed, then
Hospital Systems ________.
A) is fairly billed because resources are allocated uniformly to all jobs
B) is grossly under billed for the job, while other jobs will be unfairly over billed
C) will likely seek to do business with competitors
D) will contribute too little to profits, and Wallace Printing will not want to accept
additional work from the company
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10) Shiffon Electronics manufactures music player. Its costing system uses two cost
categories, direct materials and conversion costs. Each product must pass through the
Assembly Department, the Programming department, and the Testing Department.
Direct materials are added at the beginning of the production process. Conversion costs
are allocated evenly throughout production. Shiffon Electronics uses weighted-average
costing.
The following information is available for the month of March 2015 for the Assembly
department.
The cost details for the month of March are as follows:
What is the conversion cost per equivalent unit in March?
A) $1,595.52
B) $1,409.52
C) $1,345.52
D) $1,066.52
11) The total of the period costs listed above for December is:
A) $82,000
B) $340,000
C) $389,000
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D) $307,000
12) The process by which a company's products or services are measured relative to the
best possible levels of performance is known as ________.
A) efficiency
B) benchmarking
C) a standard costing system
D) variance analysis
13) ________ is a strategy that integrates people and technology in all business
functions to enhance relationships with customers, partners, and distributors.
A) Supply-chain analysis
B) Customer relationship management
C) Value-chain analysis
D) Continuous quality improvement

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