1) menson corporation manufactures and sells a single product. the company uses units
as the measure of activity in its budgets and performance reports. during december, the
company budgeted for 5,800 units, but its actual level of activity was 5,830 units. the
company has provided the following data concerning the formulas to be used in its
budgeting:
the direct labor in the planning budget for december would be closest to:
a.$46,057
b.$45,820
c.$43,927
d.$43,701
2) licuado juice company has four product lines; orange, tomato, carrot, and grape.
shown below is last year’s income statement segmented by product line:
net operating income last year for licuado company as a whole was $24,800.
licuado is considering the implementation of a $5,000 advertising program specifically
targeted at one of the four product lines. the program is expected to increase sales for
any one of the product lines by $12,000. if the goal is to maximize the company’s net
operating income, for which product line should licuado implement the advertising
program?
a.orange
b.tomato
c.carrot
d.grape
e.any one of the product lines; the effect on net operating income will be identical
3) financial statements for oram company appear below:
dividends during year 2 totaled $161 thousand, of which $10 thousand were preferred
dividends. the market price of a share of common stock on december 31, year 2 was
$610.
oram company’s dividend yield ratio on december 31, year 2 was closest to:
a.2.9%
b.3.3%
c.0.4%
d.3.1%
4) dasilva company had only one job in process on may 1. the job had been charged
with $1,400 of direct materials, $6,192 of direct labor, and $5,712 of manufacturing
overhead cost. the company assigns overhead cost to jobs using the predetermined
overhead rate of $11.90 per direct labor-hour. during may, the following activity was
recorded:
work in process inventory on may 30 contains $4,773 of direct labor cost. raw materials
consist solely of items that are classified as direct materials.
the entry to dispose of the underapplied or overapplied overhead cost for the month
would include a:
a.credit of $1,610 to manufacturing overhead
b.debit of $4,403 to manufacturing overhead
c.credit of $4,403 to manufacturing overhead
d.debit of $1,610 to manufacturing overhead
5) the ending balance of accounts receivable was $52,500. sales, adjusted to a cash
basis using the direct method on the statement of cash flows, were $425,000. sales
reported on the income statement were $444,000. based on this information, the
beginning balance in accounts receivable was:
a.$33,500
b.$66,500
c.$71,500
d.$39,500
6) williams company’s direct labor cost is 25% of its conversion cost. if the
manufacturing overhead for the last period was $45,000 and the direct materials cost
was $25,000, the direct labor cost was:
a.$15,000
b.$60,000
c.$33,333
d.$20,000
7) 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 variable cost per unit for maxwell company is:
a.$0.56
b.$1.79
c.$2.00
d.$1.95
8) what is the company’s contribution margin ratio?
a.250%
b.150%
c.70%
d.30%
9) buffaloe corporation manufactures and sells a single product. the company uses units
as the measure of activity in its budgets and performance reports. during august, the
company budgeted for 5,200 units, but its actual level of activity was 5,250 units. the
company has provided the following data concerning the formulas used in its budgeting
and its actual results for august:
the activity variance for selling and administrative expenses in august would be closest
to:
a.$690 f
b.$690 u
c.$20 f
d.$20 u
10) mackessy corporation applies manufacturing overhead to products on the basis of
standard machine-hours. budgeted and actual variable overhead costs for the most
recent month appear below:
the original budget was based on 7,400 machine-hours. the company actually worked
7,620 machine-hours during the month and the standard hours allowed for the actual
output were 7,730 machine-hours. what was the overall variable overhead efficiency
variance for the month?
a.$1,496 favorable
b.$1,118 unfavorable
c.$378 favorable
d.$870 unfavorable