1) marchi family inn is a bed and breakfast establishment in a converted 100-year-old
mansion. the inn’s guests appreciate its gourmet breakfasts and individually decorated
rooms. the inn’s overhead budget for the most recent month appears below:
the inn’s variable overhead costs are driven by the number of guests. what would be the
total budgeted overhead cost for a month if the activity level is 70 guests?
a.$42,460.00
b.$6,620.00
c.$7,086.15
d.$6,580.00
2) gamba corporation is a wholesaler that sells a single product. management has
provided the following cost data for two levels of monthly sales volume. the company
sells the product for $170.00 per unit.
the best estimate of the total monthly fixed cost is:
a.$865,800
b.$321,000
c.$820,400
d.$775,000
3) sheeder corporation bases its predetermined overhead rate on variable manufacturing
overhead cost of $18.70 per machine-hour and fixed manufacturing overhead cost of
$1,817,202 per period. if the denominator level of activity is 8,200 machine-hours, the
fixed element in the predetermined overhead rate would be:
a.$18.70
b.$1,870.00
c.$240.31
d.$221.61
4) witting corporation produces and sells a single product. data concerning that product
appear below:
the break-even in monthly unit sales is closest to:
a.2,523
b.1,502
c.3,337
d.2,730
5) porus corporation makes and sells a single product called a yute. the company is in
the process of preparing its selling and administrative expense budget for the last
quarter of the year. the following budget data are available:
all of these expenses (except depreciation) are paid in cash in the month they are
incurred.
if the total budget for selling and administrative expense for october is $493,300, then
how many yutes does the company plan to sell in october?
a.17,500 units
b.17,000 units
c.17,200 units
d.16,700 units
6) lakeside nursing home has two operating departments, custodial care and
rehabilitation. it also has a housekeeping department that serves the two operating
departments. the costs of the housekeeping department are all variable and are charged
to the operating departments on the basis of labor-hours. data for september follow:
the budgeted costs of the housekeeping department for september were $24,000 and the
actual costs were $29,760.
how much housekeeping department cost should be charged to rehabilitation at the end
of september for performance evaluation purposes?
a.$19,840
b.$9,920
c.$9,600
d.$7,440
7) excerpts from shelton corporation’s most recent balance sheet appear below:
sales on account in year 2 amounted to $1,320 and the cost of goods sold was $890.
the inventory turnover for year 2 is closest to:
a.6.59
b.7.42
c.1.25
d.0.80
8) which of the following would be considered a “use” of cash for purpose of
constructing a statement of cash flows?
a.selling the company’s own common stock to investors
b.issuing long-term debt
c.purchasing equipment
d.amortizing a patent
9) osman corporation uses the fifo method in its process costing system. data
concerning the first processing department for the most recent month are listed below:
note: your answers may differ from those offered below due to rounding error. in all
cases, select the answer that is the closest to the answer you computed. to reduce
rounding error, carry out all computations to at least three decimal places.
the cost per equivalent unit for materials for the month in the first processing
department is closest to:
a.$28.57
b.$26.57
c.$27.87
d.$23.97
10) desormeaux corporation applies manufacturing overhead to products on the basis of
standard machine-hours. the budgeted fixed manufacturing overhead cost for the most
recent month was $21,600 and the actual fixed manufacturing overhead cost for the
month was $21,120. the company based its original budget on 5,400 machine-hours. the
standard hours allowed for the actual output of the month totaled 5,850 machine-hours.
what was the overall fixed manufacturing overhead budget variance for the month?
a.$1,800 favorable
b.$1,800 unfavorable
c.$480 favorable
d.$480 unfavorable
11) lauser clinic uses client-visits as its measure of activity. during july, the clinic
budgeted for 3,700 client-visits, but its actual level of activity was 3,690 client-visits.
the clinic has provided the following data concerning the formulas used in its budgeting
and its actual results for july:
the net operating income in the flexible budget for july would be closest to:
a.$17,215
b.$17,122
c.$11,140
d.$11,018
12) the most recent balance sheet and income statement of teramoto corporation appear
below:
cash dividends were $18.
the net cash provided by (used by) operations for the year was:
a.$30
b.$112
c.$52
d.$117