Which of the following is not classified as an overhead cost?
a. Electricity to run factory machines
b. Insurance to protect the factory contents
c. Security guards that protect the factory building
d. Advertising cost to promote the finished goods
When managers investigate a direct labor efficiency variance, they are trying to
a. Place blame on the person responsible for the variance.
b. Understand why workers took a longer or shorter amount of time than expected to
produce a product.
c. Find out which workers were paid more than the standard rate.
d. All of these answer choices are correct.
To calculate the weighted-average cost of capital we do not need to know
a. The relative percentage of capital provided by each source.
b. The required rate of return.
c. The date of each capital source.
d. All of these answer choices are necessary to calculate the weighted-average cost of
capital.
The following information is available for Haven Industries:
Which of the following is the correct journal entry to record the direct labor payroll? a.
Work in process inventory Direct labor efficiency variance Direct labor rate variance
Wages payable 560,000
12,800 10,944 536,256
b. Work in process inventory Direct labor efficiency variance Direct labor rate variance
Wages payable 536,256 12,800 10,944
560,000
c. Wages payable Direct labor efficiency variance Direct labor rate variance Work in
process inventory 560,000
12,800 10,944 536,256
d. Wages payable Direct labor efficiency variance Direct labor rate variance Work in
process inventory 536,256 12,800 10,944
560,000
Using the direct method of preparing the statement of cash flows, which of the
following is not an activity generating operating cash flows?
a. Payments to employees
b. Payments to suppliers
c. Repayment of debt
d. Payments for operating expenses
Which of the following is not a component of the IMA Statement of Ethical
Professional Practice standards?
a.Reliability
b.Confidentiality
c.Integrity
d.Credibility
In a job order costing system, the costs of each job are accumulated on a
a. Job cost sheet.
b. Departmental cost sheet.
c. End-of-job accumulation sheet.
d. None of these answer choices are correct.
Which of the following is not classified as a variable product cost?
a. Direct materials
b. Electricity
c. Sales commissions
d. Indirect materials
Flexible budgets are used as a tool for
a. Control.
b. Evaluation.
c. Planning.
d. All of these answer choices are correct.
Match the following terms to the appropriate statement by placing the letter to the left
of each statement.
a. Direct labor efficiency variance
f. Sales price variance
b. Direct labor rate variance
g. Sales volume variance
c. Direct material quantity variance
h. Static budget variance
d. Fixed overhead spending variance
i. Variable overhead efficiency variance
e. Flexible budget variance
j. Variable overhead spending variance
Mandy’s Candies’ income statement for last month is given below. What is Mandy’s
degree of operating leverage?
a. 1.0
b. 2.0
c. 3.5
d. 7.0
There is an important relation between contribution margin and profit. Which of the
following statements is not true?
a.As the number of units sold increases, total contribution margin increases, but fixed
costs remain the same.
b.As the number of units sold rises, profit increases by the additional contribution
margin per unit.
c.As the number of units sold decreases, total contribution margin decreases, but fixed
costs remain the same.
d.All of these answer choices are correct.
The following financial statement items are shown for J&T Manufacturing.
Calculate the common-size percentage for salaries payable.
a. 7%
b. 10%
c. 23%
d. 433%
The formula for margin of safety in sales dollars is
a. Current unit sales minus breakeven unit sales.
b. Actual sales minus budgeted sales.
c. Current sales revenue minus breakeven sales revenue.
d. Breakeven sales revenue minus budgeted sales revenue.