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1) smalling inc. has provided the following data for the month of november:
the adjusted cost of goods sold that appears on the income statement for november is:
a.$237,000
b.$225,000
c.$214,000
d.$213,000
2) erdmann corporation has provided its contribution format income statement for july.
the company produces and sells a single product.
if the company sells 8,100 units, its net operating income should be closest to:
a.$58,000
b.$63,600
c.$59,468
d.$76,200
3) karrenberg corporation keeps careful track of the time required to fill orders. the
times required for a particular order appear below:
required:
a. determine the throughput time. show your work!
b. determine the manufacturing cycle efficiency (mce), show your work!
c. determine the delivery cycle time. show your work!
4) cybil baunt just inherited a 1958 chevy impala from her late aunt joop. aunt joop
purchased the car 25 years ago for $5,000. cybil is either going to sell the car for $2,000
or have it restored and sell it for $16,000. the restoration will cost $10,000. cybil would
be better off by:
a.$4,000 to have the vehicle restored
b.$6,000 to have the vehicle restored
c.$9,000 to have the vehicle restored
d.$11,000 to have the vehicle restored
5) data concerning sotero corporation's single product appear below:
the company is currently selling 5,000 units per month. fixed expenses are $319,000 per
month. consider each of the following questions independently.
this question is to be considered independently of all other questions relating to sotero
corporation. refer to the original data when answering this question.
the marketing manager would like to introduce sales commissions as an incentive for
the sales staff. the marketing manager has proposed a commission of $9 per unit. in
exchange, the sales staff would accept a decrease in their salaries of $37,000 per month.
(this is the company's savings for the entire sales staff.) the marketing manager predicts
that introducing this sales incentive would increase monthly sales by 100 units. what
should be the overall effect on the company's monthly net operating income of this
change?
a.increase of $36,100
b.decrease of $74,500
c.decrease of $500
d.increase of $419,500
6) elder company, which has only one product, has provided the following data
concerning its most recent month of operations:
what is the net operating income for the month under variable costing?
a.$9,800
b.$(27,400)
c.$15,400
d.$5,600
7) an operation costing system is:
a.identical to a process costing system except that actual manufacturing overhead costs
are traced to units of product
b.the same as a process costing system except that direct materials costs are accounted
for in the same way as in job order costing
c.the same as a job order system except that direct materials costs are accounted for in
the same way as in process costing
d.identical to a job order costing system except that actual manufacturing overhead
costs are traced to units of product
8) excerpts from stys corporation's most recent balance sheet and income statement
appear below:
dividends on common stock during year 2 totaled $50 thousand. dividends on preferred
stock totaled $10 thousand. the market price of common stock at the end of year 2 was
$8.20 per share.
the earnings per share of common stock for year 2 is closest to:
a.$1.10
b.$1.57
c.$1.85
d.$1.00
9) capul company uses the fifo method in its process costing system. the assembly
department started the month with 5,000 units in its beginning work in process
inventory that were 50% complete with respect to conversion costs. an additional
74,000 units were transferred in from the prior department during the month to begin
processing in the assembly department. there were 15,000 units in the ending work in
process inventory of the assembly department that were 60% complete with respect to
conversion costs.
what were the equivalent units for conversion costs in the assembly department for the
month?
a.84,000
b.70,500
c.73,000
d.64,000
10) 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 selling and administrative expenses in the planning budget for december would be
closest to:
a.$24,898
b.$24,880
c.$23,988
d.$23,865
11) data from alf corporation's most recent balance sheet and income statement appear
below:
the average collection period for this year is closest to:
a.78.5 days
b.74.3 days
c.40.6 days
d.36.2 days
12) inspection costs at one of pulley corporation's factories are listed below:
management believes that inspection cost is a mixed cost that depends on units
produced.
using the high-low method, the estimate of the variable component of inspection cost
per unit produced is closest to:
a.$13.73
b.$10.17
c.$0.10
d.$10.35
13) (ignore income taxes in this problem.) the becker company is interested in buying a
piece of equipment that it needs. the following data have been assembled concerning
this equipment:
this equipment is expected to have a useful life of 6 years. at the end of the sixth year
the working capital would be released for use elsewhere. the company's discount rate is
10%.
the present value of all future operating cash inflows is closest to:
a.$480,000
b.$452,300
c.$348,400
d.$278,700
