1) Ventaz Corp manufactures glasses. The manufacturing cycle efficiency is 70%. What
is its waiting time if the manufacturing lead time is 120 minutes per keyboard?
A) 38.00 minutes
B) 42.00 minutes
C) 48.00 minutes
D) 36.00 minutes.
2) Gloria’s Decorating produces and sells a mantel clock for $100 per unit. In 2015,
42,125 clocks were produced and 37,958 were sold. Other information for the year
includes:
What is the inventoriable cost per unit using absorption costing?
A) $45.00
B) $52.50
C) $115.00
D) $80.00
3) Which of the following is an example of nonlinear cost function?
A) variable-cost functions
B) fixed-cost functions
C) learning curves
D) mixed cost functions
4) Lander Corporation used the following data to evaluate their current operating
system. The company sells items for $18 each and used a budgeted selling price of $18
per unit.
What is the static-budget variance of variable costs?
A) $2,000 favorable
B) $8,000 unfavorable
C) $4,000 favorable
D) $6,000 unfavorable
5) The contribution margin for December is:
A) $1,369,400
B) $2,421,500
C) $1,193,100
D) $929,100
6) A job-cost record uses information from ________.
A) a materials-requisition record to record raw material purchases from suppliers
B) a materials-requisition report to record the type and quantity of item received in an
order from a supplier
C) a labor-time card to record an employee’s wage rate and hours spent on a particular
job
D) the bill of materials to ensure the goods are of the prescribed quality
7) Maize Plastics manufactures and sells 50 bottles per day. Fixed costs are $30,000 and
the variable costs for manufacturing 50 bottles are $10,000. Each bottle is sold for
$1,000. How would the daily profit be affected if the daily volume of sales drop by
10%?
A) profits are reduced by $4,000
B) profits are reduced by $1,000
C) profits are reduced by $5,000
D) profits are reduced by $6,000
8) Pacific Company sells only one product for $11 per unit, variable production costs
are $3 per unit, and selling and administrative costs are $1.50 per unit. Fixed costs for
10,000 units are $5,000. The operating income is ________.
A) $6.50 per unit
B) $6.00 per unit
C) $5.50 per unit
D) $5.00 per unit
9) Customer life-cycle costs are the ________.
A) costs incurred by the selling company to satisfy the customer.
B) refer to the costs to the customers for buying and using a product.
C) same as the selling life-cycle prices.
D) replacement costs of using a product or service.
10) The following data for the Prender Company pertain to the production of 800 urns
during August.
Direct Materials (all materials purchased were used):
Standard cost: $4.80 per pound of urn.
Total actual cost: $4,480.
Standard cost allowed for units produced was $4,800.
Materials efficiency variance was $96 unfavorable.
Direct Manufacturing Labor:
Standard cost is 2 urns per hour at $19.20 per hour.
Actual cost per hour was $19.60.
Labor efficiency variance was $288 favorable.
Required:
a.What is standard direct material amount per urn?
b.What is the direct material price variance?
c.What is the total actual cost of direct manufacturing labor?
d.What is the labor price variance for direct manufacturing labor?
11) Globe Inc. is a distributor of DVDs. DVD Mart is a local retail outlet which sells
blank and recorded DVDs. DVD Mart purchases tapes from Globe at $25.00 per DVD;
DVDs are shipped in packages of 60. Globe pays all incoming freight, and DVD Mart
does not inspect the DVDs due to Globe’s reputation for high quality. Annual demand is
312,000 DVDs at a rate of 6,000 DVDs per week. DVD Mart earns 15% on its cash
investments. The purchase-order lead time is one week. The following cost data are
available:
Relevant ordering costs per purchase order$114.50
Carrying costs per package per year:
Relevant insurance, materials handling,
breakage, etc., per year$ 4.50
What is the economic order quantity?
A) 64.08 packages
B) 21.04 packages
C) 37.50 packages
D) 72.03 packages
12) Autogas Corporation manufactures industrial-sized gas furnaces and uses budgeted
machine hours to allocate variable manufacturing overhead. The following information
relates to the company’s manufacturing overhead data:
What is the amount of the budgeted variable manufacturing overhead cost per unit?
A) $11.745
B) $10.570
C) $11.235
D) $11.636
13) Budgeted costs are ________.
A) the costs incurred this year
B) the costs incurred last year
C) planned or forecasted costs
D) competitor’s costs
14) Which of the following statements is true of a post-investment audit?
A) It encourages managers to overstate the expected cash inflows from projects and
accept projects they should reject.
B) It helps managers avoid optimistic estimate errors.
C) It does not help senior management to recognize problems in the implementation of
the project.
D) It provides managers with feedback about the performance of a project so they can
compare the actual results to the costs and benefits expected at the time the project was
selected.
15) An favorable production-volume variance occurs when ________.
A) the denominator level exceeds production
B) production exceeds the denominator level
C) production exceeds unit sales
D) unit sales exceed production
16) Mariposa Corporation sells “Bigger”, its only product. The following information is
available for the current month:
What is the absorption costing breakeven point in units?
A) 917 units
B) 1,000 units
C) 5,838 units
D) 6,000 units