Hahn Corporation
Hahn Corporation produces a single product that sells for $7.00 per unit. Standard
capacity is 100,000 units per year; 100,000 units were produced and 80,000 units were
sold during the year. Manufacturing costs and selling and administrative expenses are
presented below.
There were no variances from the standard variable costs. Any under- or overapplied
overhead is written off directly at year-end as an adjustment to cost of goods sold.
Hahn Corporation had no inventory at the beginning of the year.
Refer to Hahn Corporation. In presenting inventory on the balance sheet at December
31, the unit cost under absorption costing is
A. $2.50.
B. $3.00.
C. $3.50.
D. $4.50.
Process costing is used in companies that
A. engage in road and bridge construction.
B. produce sailboats made to customer specifications.
C. produce bricks for sale to the public.
D. construct houses according to customer plans.
In a standard cost system, when production is greater than the estimated unit or
denominator level of activity, there will be a(n)
A. unfavorable capacity variance.
B. favorable material and labor usage variance.
C. favorable volume variance.
D. unfavorable manufacturing overhead variance.
Ultimate Vision Corporation
Ultimate Vision Corporation has two product lines: LCD televisions and projection
televisions. The company has budgeted the following production and overhead costs for
the upcoming year:
Refer to Ultimate Vision Corporation. If the company uses an activity-based costing
(ABC) system to allocate factory overhead, the materials handing cost allocated to LCD
TVs would be:
A. $23,077
B. $28,125
C. $30,000
D. $45,000
Ryan Company
Ryan Company manufactures products X and Y from a joint process that also yields a
by-product, Z. Revenue from sales of Z is treated as a reduction of joint costs.
Additional information is as follows:
Joint costs were allocated using the sales value at split-off approach.
Refer to Ryan Company. The joint costs allocated to product X were
A. $ 84,000
B. $100,800.
C. $150,000.
D. $168,000.
Which performance plan best promotes quality of the product or service?
A. piece rate
B. health insurance
C. pensions
D. profit sharing
Which of the following is/are synonyms for joint products?
A. no no
B. yes yes
C. yes no
D. no yes
Reducing setup time is a major aspect of
A. all push inventory systems.
B. the determination of safety stock quantities.
C. a JIT system.
D. an EOQ system.
The Du Pont model measures
A. residual income.
B. return on investment.
C. throughput.
D. profit.
The after-tax net present value of a project is affected by
A. tax-deductible cash flows.
B. non-tax-deductible cash flows.
C. accounting accruals.
D. all of the above.
As the marginal tax rate goes up, the benefit from the depreciation tax shield
A. decreases.
B. increases.
C. stays the same.
D. can move up or down depending on whether the firm’s cost of capital is high or low.