test #3 managerial accounting

Pataasin ang iyong marka sa homework at exams ngayon gamit ang Quizwiz!

an adaption of residual income that has been adopted by many companies is called

economic value added

A budget that takes into account how costs are affected by changes in level of activity is a _____ budget.

flexible

Estimates of what revenues & costs should have been based on the actual level of activity are shown on the _____ budget.

flexible

the net operating income that an investment center earns about the minimum required return on its average operating assets is its _____ income

residual

ROI can be calculated as:

margin x turnover & net operating income/average operating assets

Unfavorable variance

Actual revenue is less than budgeted revenue

Favorable variance

Actual revenue is more than budgeted revenue

When considering ROI, excessive operating expenses is always a greater concern to managers than excessive operating assets. (true/false)

False

when making a decision, only relevant items are included in the analysis of the alternatives when using:

the differential cost approach only

A cost that has already been incurred & cannot be avoided regardless of what a manager decides to do is referred to as a(n) _____ cost.

sunk

When preparing a flexible budget, the level of activity

affects variable costs only

If the planned budget revenue for 5,000 units is $120,000, what is the flexible budget revenue if the actual activity is 4,500 units?

$120,000/5,000 = $24 per unit x 4,5000 = $108,000

The planning budget calls for total variable costs for supplies to be $6,250 based on 1,000 units with planned revenue at $24,000. A total of 1,200 units were actually produced & sold. What amounts should appear on the flexible budget?

$7,500 for supplies & $28,000 revenue.

A planning budget called for 500 units to be produced & total direct labor cost of $7,500. Actual production was 600 units & actual direct labor cost was $9,300. The spending variance is

$7,500/500 = $15 standard rate per hour x 600 = $9,000 flexible budget - $9,300 actual budget = $300 U

In order to increase margin, a company must (1) sales, and/or (2) operating expenses and/or (3) selling price. (increase/decrease)

1) increase 2) decrease 3) increase

Given a margin of 12%, sales of $150,000, & average operating assets of $90,000, the ROI is ___%

12% x $150,000/$90,000 = 20%

Given sales of $250,000, NOI of $25,000 & Average Operating Assets of $125,000.

Margin= $25,000/$200,000 (NOI/sales) = 10% Turnover= $250,000/125,000 (sales/average operating assets) = 2.

What ratios are part of the ROI formula?

NOI/sales & sales/average operating assets

The calculation of the budget variance uses

budgeted fixed overhead & actual fixed overhead.

when a constraint exists, companies need to focus on maximizing

contribution margin per unit of constraint

When making a decision to either buy a movie ticket or rent a DVD, the cost of the movie ticket is an example of a(n) ______ cost

incremental & avoidable

Poor supervision is one possible cause of an unfavorable ______ variance.

labor efficiency

A static budget is suitable for

planning only

SP(AQ-SQ) is the formula for the materials ______ variance.

quantity


Kaugnay na mga set ng pag-aaral

Chapter 1 - Taking Risks and Making Profits within the Dynamic Business Environment

View Set

8:2 - Treating Tobacco Dependence: Addiction & Tobacco Effects

View Set

sampling distribution of the sample mean

View Set

English4: Middle Ages Test Review

View Set

intro to cinema (chapters 1,2,3,4,5,6,7,9,12)

View Set

LearningCurve Chapter 4: Consumer and Producer Surplus

View Set