1) the best way to allocate scare resources to attain a specific objective, such as the
maximization of operating income, is:
a.relevant costing
b.responsibility accounting
c.simple regression (ols) analysis
d.operations management
e.linear programming
2) neary co. produces three products x, y, and z from a joint process. each product may
be sold at the split-off point or processed further. additional processing requires no
special facilities, and production costs of further processing are entirely variable and
traceable to the products involved. last year all three products were processed beyond
split-off. joint production costs for the year were $80,000. sales values and costs needed
to evaluate neary’s production policy follow.
the amount of joint costs allocated to product x using the net realizable value method is
(calculate all ratios and percentages to 4 decimal places, for example 33.3333%, and
round all dollar amounts to the nearest whole dollar):
a.$24,000
b.$21,333
c.$36,444
d.$40,842
e.$32,110
3) direct materials and direct labor costs total $40,000 and factory overhead costs total
$100 per machine hour. if 200 machine hours were used for job #202, what is the total
manufacturing cost for job #202?
a.$95,000
b.$75,000
c.$65,000
d.$60,000
e.$55,000
4) which one of the following is a budgeting process that requires managers to prepare
budgets based on in-depth reviews of all budget items?
a.flexible budgeting
b.continuous budgeting
c.activity-based budgeting (abb)
d.kaizen budgeting
e.zero-base budgeting (zbb)
5) stephenson company’s computer system recently crashed, erasing much of the
company’s financial data. the following accounting information was discovered soon
afterwards on the cfo’s back-up computer disk.
the cfo of stephenson company has asked you to recalculate the following accounts and
report to him by week’s end.
what should be the amount in the finished goods inventory at the beginning of the year?
a.$15,000
b.$45,000
c.$55,000
d.$61,000
6) which of the following costs would be relevant in short-term decision making?
a.incremental fixed costs
b.all product-related costs
c.total variable costs that are the same in the considered alternatives
d.cost of fixed assets to be used in the alternatives
e.opportunity costs that are the same in the considered decision alternatives
7) scrap can be classified according to which of the following?
a.option a
b.option b
c.option c
d.option d
e.none of the above
8) abc company listed the following data for the current year:
if overhead is applied based on machine hours, the overapplied/underapplied overhead
is:
a.$15,300 underapplied
b.$15,300 overapplied
c.$10,800 underapplied
d.$10,800 overapplied
e.$-0-
9) the r-squared in a satisfactory regression should be:
a.less than .3
b.greater than .3
c.less than .7
d.greater than .7
10) the shadow price in a linear programming model is:
a.interesting from a mathematical standpoint, but not useful from an accounting
standpoint
b.equal to the current market price for an additional unit of the related resource
c.the price one would be willing to pay for an additional unit of the scarce resource
d.greater than the market price for the related resource
e.zero for a binding constraint
11) one of the many changes in the business environment in recent years that has had
significant impact on cost management practices is a “focus on the customer”. you are
part of the management team in a medium-size internet service company. the company
is just three years old and is growing dramatically, doubling its customer base every six
months.
required:
(a) describe your typical customer’s needs and service expectations.
(b) how has the doubling of your firm’s customer base every six months affected its
ability to maintain this focus on the customer? if this dramatic growth continues, what
are some specific actions your firm can take to retain its goal of “focus on the
customer”?
12) sutherland company listed the following data for 2013:
assuming sutherland applied overhead based on machine hours, the company’s
predetermined overhead rate for 2013 is (round to two significant digits):
a.$44.00 per machine hour
b.$41.98 per machine hour
c.$38.31 per machine hour
d.$35.90 per machine hour
e.$41.18 per machine hour