Exam Review Quiz B ACCY

Assume that the Current Assets for Shine Co. as of December 31, 20Y5, are listed below. Assume further that the total Current Liabilities on the same date are $150,000. What is the quick ratio (acid test) for Shine Co. on December 31, 20Y5?

Quick ratio = cash + temporary investments + accounts receivable / total liabilities($150,000) = 1.3

Which of the following costs would be included as part of the factory overhead costs of a microcomputer manufacturer?

depreciation of testing equipment

A tight budget may create which of the following situations?

discouragement

Job cost sheets accumulate all of the following costs except for which one? Group of answer choices

indirect materials

Which of the following is not one of the four basic functions of the management process?

operating

Which of the following is the first step in the budget process?

plan

Which of the following is not considered a cost of manufacturing a product?

salaries of the administrative assistants

Which of the following is not considered a cost of manufacturing a product?

sales salaries

What is the ability of a business to pay its debts as they come due called?

solvency

What type of analysis is indicated by the following?

vertical analysis - since it has percentages.

The journal entry to record the requisition of materials to the factory in job order costing includes a debit to what account?

work in process

A company reports the following: Net income $160,000 Preferred dividends $10,000 Shares of common stock outstanding 20,000 Market price per share of common stock $35 ​ The company's earnings per share on common stock is

1. Calculate Net Income Available to Common Shareholders: Net Income available to common shareholders = Net Income - Preferred Dividends Net Income available to common shareholders = $160,000 - $10,000 Net Income available to common shareholders = $150,000 2. Calculate Earnings Per Share (EPS): EPS = Net Income available to common shareholders / Weighted Average Number of Shares of Common Stock Outstanding EPS = $150,000 / 20,000 shares EPS = $7.50. $7.50

A company estimated $420,000 of factory overhead cost and 16,000 direct labor hours for the period. During the period, a job was completed with $4,500 of direct materials and $3,000 of direct labor. The direct labor rate was $15 per hour. What is the factory overhead applied to the job? (Hint: You must first determine the Predetermined Factory Overhead Rate and covert the $3,000 direct labor cost to Hours Applied to the Job. Once you have the Predetermined Factory Overhead Rate that is multiplied times Hours Applied to the Job to get the correct answer.) Group of answer choices

1. Calculate the Predetermined Factory Overhead Rate: Predetermined Factory Overhead Rate = Estimated Factory Overhead Cost / Estimated Direct Labor Hours Predetermined Factory Overhead Rate = $420,000 / 16,000 hours Predetermined Factory Overhead Rate = $26.25 per direct labor hour 2. Convert Direct Labor Cost to Hours Applied to the Job: Direct Labor Cost = $3,000 Direct Labor Rate = $15 per hour Hours Applied to the Job = Direct Labor Cost / Direct Labor Rate Hours Applied to the Job = $3,000 / $15 per hour Hours Applied to the Job = 200 hours 3. Calculate Factory Overhead Applied to the Job: Factory Overhead Applied to the Job = Predetermined Factory Overhead Rate * Hours Applied to the Job Factory Overhead Applied to the Job = $26.25 per hour * 200 hours Factory Overhead Applied to the Job = $5,250

Dixon Company expects $650,000 of credit sales in March and $800,000 of credit sales in April. Dixon historically collects 70% of its sales in the month of sale and 30% in the following month. How much cash does Dixon expect to collect in April?

1. Determine the Cash Collection for March Sales: Given March credit sales = $650,000 Cash collected in March = 70% of March credit sales Cash collected in March = 0.70 * $650,000 = $455,000 2. Determine the Cash Collection for April Sales: Given April credit sales = $800,000 Cash collected in April from March sales = 30% of March credit sales Cash collected in April from March sales = 0.30 * $650,000 = $195,000 Cash collected in April from April sales = 70% of April credit sales Cash collected in April from April sales = 0.70 * $800,000 = $560,000 3. Calculate the Total Cash Collected in April: Total cash collected in April = Cash collected from March sales + Cash collected from April sales Total cash collected in April = $195,000 + $560,000 = $755,000

Assume fixed costs are $700,000, the unit selling price is $75, and the unit variable costs are $25, what is the break-even sales in units?

1. Identify the Given Values: Fixed costs = $700,000 Unit selling price = $75 Unit variable costs = $25 2. Calculate the Contribution Margin per Unit: Contribution Margin per Unit = Unit selling price - Unit variable costs Contribution Margin per Unit = $75 - $25 Contribution Margin per Unit = $50 3. Calculate the Break-even Sales in Units: Break-even sales (units) = Fixed costs / Contribution Margin per Unit Break-even sales (units) = $700,000 / $50 Break-even sales (units) = 14,000

For the month of May, Latter Company has beginning finished goods inventory of $50,000, ending finished goods inventory of $35,000, and cost of goods manufactured of $125,000. What is the cost of goods sold for May?

COGS=Beginning Finished Goods Inventory+Cost of Goods Manufactured−Ending Finished Goods Inventory Here are the simplified steps to calculate the COGS: Identify the Given Values: Beginning Finished Goods Inventory = $50,000 Ending Finished Goods Inventory = $35,000 Cost of Goods Manufactured = $125,000 Substitute the Values into the Formula: COGS = $50,000 + $125,000 - $35,000 Perform the Calculation: COGS = $140,000

If the sales account balance on the income statement is $200,000, and total cost of goods sold is $150,000, using vertical analysis determine the percentage for gross profit.

Calculate Gross Profit: Gross Profit = Sales - Cost of Goods Sold = $200,000 - $150,000 = $50,000 Calculate Gross Profit Percentage: Gross Profit Percentage = (Gross Profit / Sales) * 100% = ($50,000 / $200,000) * 100% = 0.25 * 100% = 25% So, the gross profit percentage is 25%. In summary, the simplified steps to calculate the gross profit percentage using vertical analysis are: Calculate Gross Profit using the formula: Sales - Cost of Goods Sold. Calculate Gross Profit Percentage using the formula: (Gross Profit / Sales) * 100%. 25%

If sales are $1,000,000, variable costs are $400,000, and fixed costs are $420,000, what is the contribution margin ratio?

Contribution Margin Ratio=(SalesSales−Variable Costs​)×100% Here are the simplified steps to calculate the contribution margin ratio: 1. Identify the Given Values: Sales = $1,000,000 Variable Costs = $400,000 2. Calculate the Contribution Margin: Contribution Margin = Sales - Variable Costs Contribution Margin = $1,000,000 - $400,000 Contribution Margin = $600,000 3. Calculate the Contribution Margin Ratio: Contribution Margin Ratio = (Contribution Margin / Sales) * 100% Contribution Margin Ratio = ($600,000 / $1,000,000) * 100% Contribution Margin Ratio = 0.60 * 100% Contribution Margin Ratio = 60% Therefore, the contribution margin ratio is 60%.

Assume that the Current Assets for Shine Co. as of December 31, 20Y5, are listed below. Assume further that the total Current Liabilities on the same date are $150,000. What is the current ratio for Shine Co. on December 31, 20Y5?

Current ration = total current assets/ $150,000 = 2.1

Which of the following best describes the difference between financial and managerial accounting?

Managerial accounting is not restricted to generally accepted accounting principles, while financial accounting is restricted to GAAP.

The total estimated sales for the coming year is 250,000 units. The estimated inventory at the beginning of the year is 22,500 units, and the desired inventory at the end of the year is 30,000 units. What should be the total production units indicated in the production budget?

Total Production Units=Estimated Sales for the Coming Year+Desired Ending Inventory−Beginning Inventory Here's how to calculate it: 1. Identify the Given Values: Estimated sales for the coming year = 250,000 units Beginning inventory = 22,500 units Desired ending inventory = 30,000 units 2. Substitute the Given Values into the Formula: Total Production Units = 250,000 + 30,000 - 22,500 3. Perform the Calculation: Total Production Units = 250,000 + 7,500 Total Production Units = 257,500 units

Assume that fixed costs are $700,000, the unit selling price is $75, and the unit variable costs are $25, what is the amount of sales in units to realize an operating income of $300,000?

Units Required=Contribution Margin per UnitFixed Costs+Target Operating Income​ Here's how to calculate it: 1. Identify the Given Values: Fixed costs = $700,000 Target operating income = $300,000 Unit selling price = $75 Unit variable costs = $25 2. Calculate the Contribution Margin per Unit: Contribution Margin per Unit = Unit selling price - Unit variable costs Contribution Margin per Unit = $75 - $25 Contribution Margin per Unit = $50 3. Calculate the Units Required: Units Required = (Fixed Costs + Target Operating Income) / Contribution Margin per Unit Units Required = ($700,000 + $300,000) / $50 Units Required = $1,000,000 / $50 Units Required = 20,000

Assume that the Current Assets for Shine Co. as of December 31, 20Y5, are listed below. Assume further that the total Current Liabilities on the same date are $150,000. What is the amount of the working capital for Shine Co. on December 31, 20Y5?

Working Capital = total current assets - $150,000 = $167,700.

Which of the following most often use static budgets?

administrative departments

For which of the following would the job order costing system be appropriate?

antique furniture repair shop