Archives: Quiz

1) jam company uses the weighted-average method in its process costing system. operating data for the painting department for the month of april appear below: what were the equivalent units for conversion costs in the painting department for april? a.78,680 […]

1) edmondson inc. produces and sells a single product. the selling price of the product is $200.00 per unit and its variable cost is $50.00 per unit. the fixed expense is $205,500 per month. the break-even in monthly unit sales […]

1) leonhardt corporation’s net income last year was $3,800,000. the dividend on common stock was $2.00 per share and the dividend on preferred stock was $1.80 per share. the market price of common stock at the end of the year […]

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 […]

1) dufour corporation uses the weighted-average method in its process costing system. this month, the beginning inventory in the first processing department consisted of 600 units. the costs and percentage completion of these units in beginning inventory were: a total […]

1) kerson corporation’s most recent balance sheet and income statement appear below: required: compute the following for year 2: a. times interest earned. b. debt-to-equity ratio. Answer: 2) the most recent balance sheet and income statement of teramoto corporation appear […]

1) sabat corporation has two productss94 and t88that use the same constrained resourcea critical raw material. data concerning those products follow: the total amount of the constrained resource available is 10,400 grams. required: a. which product is most profitable, given […]

1) the average sale period for year 2 is closest to: a.35.1 days b.237.9 days c.58.0 days d.53.9 days 2) pittmon corporation is developing direct labor standards. the basic direct labor wage rate is $13.90 per hour. employment taxes are […]

1) the working capital at the end of year 2 is: a.$1,020 thousand b.$280 thousand c.$650 thousand d.$990 thousand 2) the following labor standards have been established for a particular product: the following data pertain to operations concerning the product […]

1) drabant kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. during february, the kennel budgeted for 2,000 tenant-days, but its actual level of activity was 2,040 […]

1) during august, sherill corporation incurred $78,000 of actual manufacturing overhead costs. during the same period, the manufacturing overhead applied to work in process was $81,000. the journal entry to record the incurrence of the actual manufacturing overhead costs would […]

1) seyal inc.’s contribution margin ratio is 55% and its fixed monthly expenses are $34,000. assuming that the fixed monthly expenses do not change, what is the best estimate of the company’s net operating income in a month when sales […]

1) the following data pertain to activity and costs for two recent months: assuming that these activity levels are within the relevant range, the mixed costs for november were: a.$40,000 b.$35,000 c.$25,000 d.$20,000 2) the richmond company uses the weighted-average […]

1) 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 […]

1) mahan, inc., uses the absorption costing approach to cost-plus pricing described in the text to set prices for its products. based on budgeted sales of 60,000 units next year, the unit product cost of a particular product is $56.20. […]

1) zents inc. produces and sells a single product. the selling price of the product is $240.00 per unit and its variable cost is $108.00 per unit. the fixed expense is $407,880 per month. the break-even in monthly dollar sales […]

1) which of the following accounts would be included in the calculation of the acid-test ratio? a.choice a b.choice b c.choice c d.choice d 2) under a standard cost system, the materials price variances are usually the responsibility of the: […]

1) prater company has provided the following data: the best estimate of the company’s variable selling and administrative expense per unit is: a.$0.24 per unit b.$4.17 per unit c.$0.91 per unit d.$0.96 per unit 2) a partial listing of costs […]

1) (ignore income taxes in this problem) the management of malit corporation is investigating an investment in equipment that would have a useful life of 9 years. the company uses a discount rate of 17% in its capital budgeting. the […]

1) bosril corporation uses the weighted-average method in its process costing system. this month, the beginning inventory in the first processing department consisted of 400 units. the costs and percentage completion of these units in beginning inventory were: a total […]

1) 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 […]

1) burgett corporation’s balance sheet and income statement appear below: cash dividends were $41. the company sold equipment for $15 that was originally purchased for $4 and that had accumulated depreciation of $4. the net cash provided by (used by) […]

1) dantuono corporation manufactures and sells a single product. the company uses units as the measure of activity in its budgets and performance reports. during november, the company budgeted for 7,700 units, but its actual level of activity was 7,720 […]

1) the tobler company has budgeted production for next year as follows: four pounds of raw materials are required for each unit produced. raw materials on hand at the start of the year total 4,000 pounds. the raw materials inventory […]

1) differential costs can be either fixed or variable. 2) activity-based costing uses a number of activity cost pools, each of which is allocated to products on the basis of direct labor-hours. Answer: false 3) the issuance of a stock […]

1) in the manufacturing overhead budget, the non-cash charges (such as depreciation) are added to the total budgeted manufacturing overhead to determine the expected cash disbursements for manufacturing overhead. 2) the three cost categories appearing on a job cost sheet […]

1) changing a cost accounting system is likely to meet with little resistance in an organization since it is a technical matter of little interest to individuals outside of the accounting department. 2) if a company is considering accepting a […]

1) economists correctly point out that many costs that the accountant classifies as variable are actually curvilinear. 2) screening decisions follow preference decisions and seek to rank investment proposals in order of their desirability. Answer: false 3) when a company […]

1) in companies that have “no lay-off” policies, the total direct labor cost for a budget period is computed by multiplying the total direct labor hours needed to make the budgeted output of completed units by the direct labor wage […]

1) the costs assigned to units in inventory are typically lower under absorption costing than under variable costing. 2) when using internal rate of return to evaluate investment projects, if the internal rate of return is less than the required […]

1) the lean thinking model focuses on reducing defects to as close to zero as possible. 2) corporate social responsibility refers to the moral obligation of all corporations to make substantial monetary contributions to charitable causes. Answer: false 3) all […]

1) when reconciling variable costing and absorption costing net operating income, fixed manufacturing overhead costs released from inventory under absorption costing should be deducted from variable costing net operating income to arrive at the absorption costing net operating income. 2) […]

1) if the finished goods inventory increases between the beginning and the end of a period, then the cost of goods manufactured for the period is larger than the cost of goods sold. 2) the cost of shipping parts from […]

1) if a company operates at a profit, the after-tax cost of a tax-deductible cash expense is determined by multiplying the cash expense by one minus the tax rate. 2) a favorable labor efficiency variance would result in a credit […]

1) negative free cash flow invariably signals poor performance. 2) quantity standards indicate how much of an input should be used for manufacturing a unit of product or in providing a unit of service. Answer: true 3) an investment project […]

1) the demand for products that are sold in discount stores is generally more elastic than the demand for products sold in upscale boutiques. 2) if all four of argo corporation’s overhead variances are favorable, argo’s overhead will be overapplied. […]

1) an action analysis report reconciles activity-based costing product costs with traditional product costs based on direct labor. 2) under variable costing, product cost contains some fixed manufacturing overhead cost. Answer: false 3) the payback method of making capital budgeting […]

1) when a dispute arises over a transfer price, top managers should intervene to keep divisional managers from making a costly mistake, even though the divisions are evaluated as profit centers. 2) the denominator activity represents the actual level of […]

1) from a standpoint of cost control, the most effective time to recognize materials price variances is when the materials are placed into production. 2) a production budget is to a manufacturing firm as a merchandise purchases budget is to […]

1) in activity-based costing, organization-sustaining costs should not be included in product costs for internal management reports that are used for decision-making. however, companies frequently include organization-sustaining costs in product costs to satisfy external reporting requirements. 2) if the standard […]

1) in preference decision situations, a project with a high net present value will always be preferable to a project with a lower net present value. 2) when long-term investment funds are the constraint and the company is choosing from […]

1) suppose fewer units are sold in year 2 than in year 1. if production exceeds sales in year 2, net operating income under absorption costing could be higher in year 2 than in year 1. 2) the statement of […]

1) an increase in the number of units sold will decrease the break-even point. 2) the profit in cost-volume-profit equations is the same as the net operating income on a contribution income statement. Answer: true 3) if a product is […]

1) if improvement in a performance measure on a balanced scorecard should lead to improvement in another performance measure, but does not, then management should reexamine its strategy. 2) if the expected level of activity is appreciably above or below […]

1) relative profitability is concerned with ranking business segments for the purpose of making trade-offs among the segments. 2) a company has a standard cost system in which fixed and variable manufacturing overhead costs are applied to products on the […]

1) whoever is responsible for the control of the denominator activity in the predetermined overhead rate should also be responsible for the variable overhead efficiency variance. 2) the activity variance for revenue is unfavorable if the actual revenue for the […]

1) enterprise risk management involves replacing risky investments with investments in low-risk government securities. 2) under the direct method of determining the net cash provided by operating activities on the statement of cash flows, an increase in account receivable would […]

1) trend percentages state several years’ financial data in terms of a base year. for example, sales for every year would be stated as a percentage of the sales in the base year. 2) the production manager is usually held […]

1) an unfavorable activity variance for a cost indicates that spending was higher than it should have been for the actual level of activity for the period. 2) the emphasis in the balanced scorecard is on improvement rather than meeting […]

1) the fixed manufacturing overhead budget variance and the fixed manufacturing overhead volume variance taken together explain the difference between the actual fixed manufacturing overhead cost incurred and the fixed manufacturing overhead cost applied to production. 2) the present value […]