1) which of the following statements regarding cvp analysis is true?
a.because of cost-structure issues, it cannot be used in a service setting
b.it is a short-term profit-planning tool
c.it is impossible to apply when there are multiple products sold by the firm in question
d.it relies on the use of regression analysis to solve for the point of optimum profit
e.it cannot be used in conjunction with activity-based costing (abc)
2) walman corp. manufactures products x, y, and z from a joint production process.
joint costs are allocated to products on the basis of relative sales value at the split-off
point. additional information is as follows:
product x’s sales value at the split-off point is:
a.$306,000
b.$135,000
c.$340,000
d.$150,000
e.$233,000
3) abc company listed the following data for the current year:
if overhead is applied based on direct labor hours, the overapplied/underapplied
overhead is:
a.$15,300 underapplied
b.$15,300 overapplied
c.$51,600 underapplied
d.$51,600 overapplied
e.$-0-
4) tierney construction, inc. recently lost a portion of its financial records in an office
theft. the following accounting information remained in the office files:
direct labor cost incurred during the period amounted to 2.5 times the factory overhead.
the cfo of tierney construction, inc. has asked you to recalculate the following accounts
and to report to him by the end of tomorrow.
what should be the amount of direct materials used?
a.$15,000
b.$29,000
c.$20,000
d.$24,000
5) everlast co. manufactures a variety of drill bits. the company’s plant is partially
automated. the budget for the year includes $432,000 payroll for 4,800 direct
labor-hours. listed below is cost driver information used in the product-costing system:
a current product order has the following requirements:
what is the total manufacturing overhead for the current product order if the firm uses a
plantwide rate based on direct labor-hours?
a.$9,960
b.$30,240
c.$43,741
d.$44,268
e.$109,352
6) diamond cleats co. manufactures cleats for baseball shoes. it has outlined the
following overhead cost drivers:
diamond cleats co. has an order for cleats that has the following production
requirements:
using activity-based costing, applied miscellaneous factory overhead for the baseball
cleat order based on direct labor hours is:
a.$8,745
b.$10,312
c.$10,489
d.$9,912
e.$8,456
7) which of the following budgets must be completed before preparing a cash budget?
a.cash receipts budget
b.rolling budget
c.cash financing budget
d.pro forma balance sheet
e.pro forma income statement
8) in order to remain competitive in the contemporary business environment, several
firms have started training their employees to stop viewing problems as strictly
functional – that is, as only a marketing problem, or an accounting problem, for
example. what does this trend illustrate about strategic management?
a.there has been a renewed emphasis on integrative thinking and solving problem
cross-functionally
b.functional barriers are an inherent part of a company’s value chain
c.firms are increasingly seeing the value of business intelligence
d.swot analysis is designed to break down functional barriers
9) the management accountant’s responsibility under the institute of management
accountants (ima) statement of ethical professional practice includes the responsibility
to “mitigate actual conflicts of interest.” this responsibility fits within which of the four
standards in the ima statement?
a.communication
b.integrity
c.honesty
d.quality
e.confidentiality
10) a measure of frequency and intensity of demands placed on activities by cost
objects is:
a.quantity driver
b.resource consumption cost driver
c.not a cost driver
d.activity consumption cost driver
e.consumption cost driver
11) the sand cruiser is a takeout food store at a popular beachside resort. teresa texton,
owner of the sand cruiser, was deciding how much refrigerator space to devote to four
different beverages. appropriate data on the four beverages follow:
teresa had a maximum front shelf space of fourteen feet to devote to the four beverages.
she wanted a minimum of two feet and a maximum of seven feet of front shelf for each
beverage. the contribution margin per case for limeade is:
a.$5.50
b.$6.40
c.$17.60
d.$16.20
e.$9.40
12) determination of the optimum short-term product mix needs to include an analysis
of:
a.fully absorbed costs
b.production constraints
c.sales-mix costs
d.revenue forecasts
e.joint manufacturing costs
13) which of the following is not a critical success factor?
a.financial factor
b.learning and growth
c.governmental relations
d.brand recognition
14) which of the following is a contemporary management technique used by the
management accountant to identify and monitor the costs of a product throughout all
steps from product design to the finished product?
a.enterprise risk management
b.target costing
c.life cycle costing
d.enterprise sustainability
15) in a given process costing system, the equivalent units are computed using the
weighted-average method. with respect to conversion costs, the percentage of
completion for the current period is necessary for the calculation of the:
a.option a
b.option b
c.option c
d.option d
e.none of the above
16) the multi resource company manufactures two lines of washing machines, regular
and deluxe. the contribution margin of a regular model is $110 and for deluxe model is
$175. the company has two departments, assembly and testing. the regular model
requires 3 hours to assemble, while a deluxe model requires 4 hours. the total time
available in assembly is 12,000 hours. in the testing department, it requires 2.5 hours to
test a regular model and 1.5 hours to test a deluxe model. a total of 6,000 hours of
testing time is available. the optimum production plan for multi resource is:
a.2,400 regular models
b.3,000 deluxe models
c.1,091 regular models and 2,182 deluxe models
d.4,000 deluxe models
e.4,000 regular models
17) which one of the following customer critical success factors is best measured by
warranty expense?
a.quality
b.dealer and distributor efficiency and effectiveness
c.timeliness of delivery
d.customer satisfaction