acc 211 final
A firm operated at 90 % of capacity for the past year , during which fixed costs were $ 420,000 , variable costs were 40 % of sales , and sales were $ 1,000,000 . Operating income was
$ 180,000
From the provided schedule of activity costs , determine the total activity cost .
$ 241,000
Zipee Inc.'s unit selling price is $ 90 , the unit variable costs are $ 40.50 , fixed costs are $ 170,000 , and current sales are 12,000 units . How much will operating income change if sales increase by 5,000 units ?
$ 247,500 increase
A company sells goods for $ 150,000 that cost $ 54,000 to manufacture . Which of the following statements is true ?
The company will decrease finished goods by $ 54,000 .
In order to be useful to managers , managerial accounting reports should possess which of the following characteristics ?
all of these choices
Principal components of a master budget include
all of these choices
Which of the following conditions normally would indicate that standard costs should be revised ?
all of these choices
If 1,000 units remain unsold at the end of the month and sales total $ 150,000 for the month , the amount of manufacturing margin that would be reported on the absorption costing income statement is
anot reported
The amount of manufacturing margin that would be reported on the variable costing income statement is
b . $ 56,000
A favorable cost variance occurs when
b . standard costs are more than actual costs than
Which of the graphs in Figure 1 illustrates the behavior of a total fixed cost ?
Graph 1
Which of the graphs in Figure 1 illustrates the behavior of a total variable cost ?
Graph 3
Which of the following statements is true of operating leverage ?
It is used to measure the impact of changes in sales on operating income .
The number of units expected to be manufactured in April is
11,000 units
Piper Technology's fixed costs are $ 1,500,000 , the unit selling price is $ 250 , and the unit variable costs are $ 130 . The amount of sales ( rounded to the nearest whole unit ) required to realize an operating income of $ 200,000 is
14,167 units
The budgeted units of production for January would be
181,000 units
If fixed costs are $ 500,000 , the unit selling price is $ 55 , and the unit variable costs are $ 30 , the break - even sales ( units ) if fixed costs are increased by $ 80,000 is
23,200 units
Assuming that last year's fixed costs totaled $ 960,000 , Carter Co.'s break - even point in units was
40,000 units
Motorcycle Manufacturers , Inc. , projected sales of 78,000 machines for the year . The estimated January 1 inventory is 6,500 units , and the desired December 31 inventory is 6,000 units . The budgeted production for the year is
77,500 units
Which of the following terms is commonly used to describe the concept whereby the cost of manufactured products is composed of direct materials cost , direct labor cost , and variable factory overhead cost ?
variable costing
Southern Company is preparing a cash budget for April . The company has $ 12,000 cash at the beginning of April and anticipates $ 30,000 in cash receipts and $ 34,500 in cash disbursements during April . Southern Company has an agreement with its bank to maintain a minimum cash balance of $ 10,000 . To maintain the required balance during April , the company must
borrow $ 2,500
The point where the sales line and the total costs line intersect on the cost - volume - profit chart represents the
break - even point
Accountants prefer the variable costing method over the absorption costing method for evaluating the performance of a company because
by using the absorption costing method , income could appear to be higher by producing more inventory .
The cash payments expected for Finch Company in the month of May are
c . $ 185,600
Which of the following is a plan that shows the expected cash receipts ( inflows ) and payments ( outflows ) during the budget period , including receipts from loans needed to maintain a minimum cash balance and repayments of such loans ?
cash budget
The systematic examination of the relationships among selling prices , volume of sales and production , costs , and profits is termed analysis .
cost - volume - profit
On the income statement of a manufacturing company , which of the following replaces purchases in the " Cost of goods sold " section of a retail company ?
cost of goods manufactured
The budgeted total sales for April is
d . $ 230,000
The cost of a manufactured product generally consists of which of the following costs ?
direct labor cost , direct materials cost , and factory overhead cost
A disadvantage of static budgets is that they
do not allow for possible changes in activity levels
The amount of income under absorption costing will equal the amount of income under variable costing when units manufactured
equal units sold
The amount of income under absorption costing will be more than the amount of income under variable costing when units manufactured
exceed units sold
The amount of the deficiency or excess cash ( after considering the minimum cash balance required ) for January is a ( n )
excess of $ 26,700
Forde Co. has an operating leverage of 4. Sales are expected to increase by 12 % next year . Operating income is
expected to increase by 48 %
Which of the following budgets allows for adjustments in activity levels ?
flexible budget
Which of the following is an integrated set of operating and financial budgets for a period of time ?
master budget
The source document for the data for debiting Work in Process for direct materials is a
materials requisition
What is the balance of Sales for Adams Company at the end of the first quarter ?
$ 1,000
The dollar amount of Material B used in production during the year is
$ 1,057,400
What is the ending balance of Finished Goods for Adams Company at the end of the first quarter ?
$ 1,067
The residual income for Mason Corporation is
$ 1,500
The differential revenue from the acceptance of the offer is
$ 262,500
If a business had sales of $ 4,000,000 and a margin of safety of 25 % , the break - even point was
$ 3,000,000
The profit margin ( rounded to one decimal place ) for Mason Corporation is
14.1 %
The markup percentage on product cost for the company's product is
23.4 %
A Marshall had assets Marshall , sales of $ 242,000 is , operating income of $ 66,000 , and a desired minimum return on investment of 3 % . The return on investment investment ( ( rounded rounded to to one one decimal decimalvested in place ) for Corporation
30.0 %
The cash payback period for the equipment is
5 years
Which of the following is an example of value - added time ?
processing time
AnaCarolina and Jaco , accountants for Duke Manufacturing , are tasked with determining appropriate performance metrics for the financial perspective of Duke's balanced scorecard . Which of the following is the best metric for this situation ?
return on investment
Which of the following is an advantage of the cash payback method ?
easy to use
Which of the following elements of the balanced scorecard shows the expected cause - and - effect relationships among strategic objectives ?
strategy maps
Alexander and Kristin are executive managers at Safety First Fall Safety Equipment Co. They realize that within the last several quarters , they have been heavily focused on the online customer satisfaction rating as though they have fallen prey to a cognitive bias known as it is the strategic objective rather than focusing on the customers as the company's real goal . Alexander and Kristin realize
surrogation
Sometimes the term " corporate social responsibility " is used interchangeably with the term
sustainability efforts
Which of the following would most likely use job order costing ?
swimming pool installer
Contribution margin is
the excess of sales revenue over variable cost
The standard costs and actual costs for direct materials for the manufacture of 3,000 actual units of product are as follows : The direct materials price variance is
$ 1,500 favorable
What is the ending balance of Cost of Goods Sold for Adams Company at the end of the first quarter ?
$ 1,685
The Assembly Department's factory overhead rate ( rounded to the nearest cent ) is
$ 10.50 per direct labor hour
From the provided schedule of activity costs , determine the prevention ists .
$ 104,000
If budgeted beginning finished goods inventory is $ 8,000 , budgeted ending finished goods inventory is $ 9,400 , and budgeted cost of goods sold is $ 10,260 , budgeted cost of ✔goods manufactured should be
$ 11,660
When Job 117 was completed , direct materials totaled $ 4,400 ; direct labor , $ 5,600 ; and factory overhead , $ 2,400 . A total of 1,000 units were produced at a per - unit cost of
$ 12.40
Management is considering the discontinuance of the manufacture and sale of Product T at the beginning of the current year . The discontinuance would have no effect on the total fixed costs and expenses or on the sales of Product U. The amount of change in profit for the current year that will result from the discontinuance of Product T is a
$ 140,000 decrease
Given the following data : What is cost of goods sold ?
$ 152,000
The differential cost from the acceptance of the offer is
$ 165,000
Carter Co.'s unit contribution margin of M was
$ 24
The total factory overhead to be allocated to each unit of Hooks is
$ 33
The expected average rate of return ( rounded to one decimal place ) for a proposed investment of $ 650,000 in a fixed asset , with a useful life of 4 years , straight - line depreciation , no residual value , and an expected total net income of $ 240,000 for the 4 years , is
18.5 %
If sales are $ 400,000 , variable costs are 80 % of sales , and operating income is $ 40,000 , the operating leverage is
2.0
Carter Co.'s sales mix last year was
20 % Arks ; 80 % Bins
Juanita and Carl are reviewing their company's balanced scorecard strategic objectives when they discover a problem . Which of the following is an inappropriate matching of a strategic objective to its performance perspective in their company's BSC ?
The strategic objective in the financial perspective is to reduce shipping errors .
Standard direct materials costs are determined by multiplying the standard price by the standard quantity .
True
A widely used activity base for developing factory overhead rates in highly automated settings is
machine hours
Under a lean environment , employees have the responsibility and authority to
make decisions about operations , rather than waiting for management
Which of the following is an advantage of decentralized operations ?
managers closest to operations make decisions
Alexander and Kristin are executive managers at Safety First Fall Safety Equipment Co. They decide to discontinue gathering data and calculating performance metrics within their organization because the company's balanced scorecard performance metrics have produced several quarters in a row of good news . They assume the positive results will continue . Alexander and Kristin have made this decision as a result of a cognitive bias known as
motivated reasoning
Which of the following are commonly used approaches to setting transfer prices ?
negotiated price approach , cost price approach , and market price approach
Which of the following are present value methods of analyzing capital investment proposals ?
net present value and internal rate of return
Which of the following are actual factory overhead allocation methods ?
single plantwide rate , multiple production department rates , and activity - based costing methods .
Standard costs are divided into which of the following components ?
standard price and standard quantity
Which of the following terms is used to describe the process of developing the organization's long - term objectives ?
strategic planning
In job order costing , on which of the following would labor costs be initially recorded ?
time tickets
In general , corporate social responsibility activities and reporting efforts within the Fortune 500 group of companies have since 2011 .
increased
A plant manager's salary is a [ n )
indirect cost
Which of the following would be classified as a variable cost for a T - shirt manufacturer ?
ink used for screen printing
Which of the following would most likely use process costing ?
lawn fertilizer manufacturer
Nonfinancial performance measures in the balanced scorecard such as customer satisfaction are often of future financial performance .
leading indicators
Using a single plantwide rate ( rounded to the nearest cent ) , the factory overhead allocated per unit of Product A in the Painting Department is
$ 236.32 per unit
The unit selling price for the company's product is
$ 21.25
Which of the following underlying problems may be hidden by high raw materials , work in process , and finished goods inventory levels ?
. all of these choices
The cost per unit for the production of the company's product is
$ 17.22
The dollar amount of desired profit from the production and sale of Magpie's product is
$ 175,000
From the provided schedule of activity costs , determine the value - added costs .
$ 177,000
Strait Co. manufactures office furniture . During the most productive month of the year , 3,000 desks were manufactured at a total cost of $ 59,000 . In the month of lowest production , the company made 1,125 desks at a cost of $ 38,000 Using the high - low method of cost estimation , total fixed costs are Answer
$ 25,400
Smith Company reports the following information : Factory overhead is 75 % of the cost of direct labor . Work in process inventory on December 31 is
$ 13,500
cost and activity observations for Bounty Company's utilities , use the high - low method to determine Bounty's variable utilities cost per machine hour Round your Given the following answer to the nearest cent .
$ 0.11
engineer proposes reengineering the setup activity so that it takes 60 % of the original cost per setup . By how much will this Graham Company wants to reduce activity costs by $ 0.30 per unit . The setup activity for a batch of 100 units of Part RR110 currently costs $ 80 per setup . A process reduce activity costs per unit ? Will more cost savings need to be found ?
$ 0.32 ; no
The total factory overhead to be allocated to Nooks is
$ 488,000
Carter Co.'s variable cost of M was
$ 64
Carter Co.'s unit selling price of M. with M representing one overall company product , was
$ 88
If 1,500 units remain unsold at the end of the month , the amount of inventory that would be reported on the variable costing balance sheet is
$$ 2,500
As production increases , the fixed cost per unit
a decreases
The relative distribution of sales among the various products sold by a business is the
sales mix
Estimated cash receipts include planned increases in cash from which of the following ?
notes and accounts receivable collections
Period costs include
operating costs that are shown on the income statement in the period in which they are incurred
Managerial accounting reports are
prepared according to management needs .
Which of the following is most associated with financial accounting reports ?
prepared in accordance with GAAP
Which of the following is the correct flow of manufacturing costs ?
raw materials , work in process , finished goods , cost of goods sold
In job order costing , when goods that have been ordered are received , the receiving department personnel count the goods , inspect the goods , and complete a
receiving report
Most operating decisions of management focus on a narrow range of activity called the of production .
relevant range
Which of the following is an example of a mixed cost ?
rental costs of $ 10,000 per month plus $ 0.30 per machine hour of use
The amount of operating income that would be reported on the variable costing income statement is
. $ 18,200
If 1,000 units remain unsold at the end of the month and sales total $ 150,000 for the month , the amount of contribution margin that would be reported on the variable costing income statement is
. $ 53,000
The differential revenue of producing Product D is
. $ 6.25 per pound
The Fabrication Department's factory overhead rate ( rounded to the nearest cent ) is
$ 3.75 per machine hour
A company's history indicates that 20 % of its sales are for cash and the rest are on credit . Collections on credit sales are 20 % in the month of the sale , 50 % in the next X month , 25 % the following month , and 5 % is uncollectible . Projected sales for December , January , and February are $ 60,000 , $ 85,000 , and $ 95,000 , respectively . The February expected cash receipts from all current and prior credit sales are
$ 61,200
Thomlin Company forecasts that total factory overhead for the current year will be $ 15,500,000 with 250,000 total machine hours . Year to date , the actual factory . overhead is $ 16,000,000 and the actual machine hours are 330,000 hours . The predetermined factory overhead rate based on machine hours is
$ 62 per machine hour
From the provided schedule of activity costs , determine the non - value - added costs .
$ 64,000
The total factory overhead allocated per unit of Rings is
$ 64.50
▸ From the provided schedule of activity costs , determine the appraisal costs .
$ 73,000
Using the variable cost method , the markup per unit for 30,000 units ( rounded to the nearest dollar ) using the following data is
$ 8
The profit margin for Division C is 6 % , and the investment turnover is 1.2 . The return on investment ( rounded to one decimal place ) for Division C is
7.2 %
What is the value - added ratio ( rounded to one decimal place ) in this process ?
8.6 %
The following data relate to direct labor costs for the current period : Standard costs 7,500 hours at $ 11.70 Actual costs 6,000 hours at $ 12.00 The direct labor time variance is
$ 17,550 favorable
Which of the following statements regarding strategic objectives in the balanced scorecard is false ?
Another name for the overall mission statement of a company is the company's strategic objective .
Which of the following is an international organization that develops and encourages the use of sustainability reporting standards ?
Global Reporting Initiative
Harrison Company uses a balanced scorecard approach to performance measurement , and company executives would like to integrate CSR activities into the company's core strategy . Which of the following statements regarding the appropriate way to make this integration work for Harrison is false ?
Harrison will have to remove one of the original four perspectives from its BSC and include CSR activities in a separate performance perspective because the BSC can have a maximum of four perspectives .
maski department is proposing offers the best internal rate of return ? the purchase of an automatic insertion machine . It has identified 3 machines , each with an estimated life of 10 years . Which
Machine B only )
Which of the following statements best describes the relationship among the costs of quality ?
Spending more on prevention and appraisal costs will reduce the total overall costs of quality .
Which of the following are the four performance perspectives included in the balanced scorecard ?
financial , internal processes , learning and growth , and customer
Which of the following terms is commonly used to describe the concept whereby the cost of manufactured products is composed of direct materials cost , direct labor cost , and all factory overhead cost ?
absorption costing
Actions that transform a traditional manufacturing environment to a lean environment include which of the following ?
all of these choices
How are the objectives of lean manufacturing achieved ?
all of these choices
Managers use managerial accounting information for which of the following purposes ?
all of these choices
Standard costs are used in companies for a variety of reasons . Which of the following is a benefit of using standard costs ?
all of these choices
Understanding how costs behave is useful to management for
all of these choices
Which of the following budgets is directly associated with the production budget ?
all of these choices
Which of the following is reason for a direct materials quantity variance ?
all of these choices
Which of the following is related to long lead times ?
all of these choices
Which of the following managerial decisions relies on accurate product costing ?
all of these choices
Which of the following is the best - known strategic performance measurement system ?
balanced scorecard
A point in the manufacturing process where the demand for the company's product exceeds the ability to produce the product is called
c . a production bottleneck
Accounting for lean operations requires fewer transactions because
combined materials and conversion costs are transferred to finished goods
Alexander and Kristin are executive managers at Safety First Fall Safety Equipment Co. They realize that within the last several quarters , they have been treating the performance metrics from the company's two very distinct divisions the same rather than focusing on the unique aspects of each division . They have inaccurately assessed divisional performance as a result . Alexander and Kristin realize they have fallen prey to a cognitive bias known as -
common measures bias
Which of the following are the three common types of responsibility centers ?
cost center , profit center , and investment center
Julia and Jaime manage a glass - making company . Their company includes a manufacturing division , a warehouse and logistics division , and a customer care division . To ✔avoid common measures bias when analyzing the performance of each of these unique divisions , Julia and Jaime should
create a unique divisional scorecard for each separate division
Businesses that are separated into two or more manageable units in which managers have authority and responsibility for operations are said to be
decentralized
The lean philosophy attempts to reduce setup times , which will
decrease within - batch wait time
Ana Carolina and Jaco work at Duke Manufacturing , and they are tasked with determining appropriate performance metrics for the internal processes perspective of Duke's ✔balanced scorecard . Which of the following is the best metric for this situation ?
defective units produced
The amount of increase or decrease in revenue that is expected from a particular course of action as compared with an alternative is
differential revenue
From the provided schedule of activity costs , determine the external failure costs .
$ 31,000
Fashion Jeans , Inc. , sells two lines of jeans : Simple estimates that 60 % is collected in the month of the sale , 35 % is collected in the following Life and Fancy Life . Simple Life sells for $ 85 , and Fancy Life sells for $ 100 . The company sells all of its jeans on credit month , and the rest is considered to be uncollectible . The estimated sales for Simple are : January , 20,000 pairs of jeans ; February , 27,500 pairs of jeans ; and March , 25,000 pairs of jeans . The estimated sales for Fancy are : January , 18,000 pairs of jeans ; February , 19,000 pairs of jeans ; and March , 20,500 pairs of jeans . The expected cash receipts for the month of March is
$ 3,988,125
From the provided schedule of activity costs , determine the internal failure costs .
$ 33,000
Darwin Company reports the following information : Product costs are
$ 35,000
2 out Compute conversion costs given the following data : direct 4 materials , $ 347,500 ; direct labor , $ 196,300 ; factory overhead , $ 187,900 ; and selling expenses , $ 45,290 .
$ 384,200
The following data relate to direct labor costs for the current period Standard costs 6,000 hours at $ 12,00 Actual costs 7,500 hours at $ 11.40 The direct labor rate variance is t
$ 4,500 favorable
What is the ending balance of Work in Process for Adams Company at the end of the first quarter ?
$ 456
Thomlin Company forecasts that total factory overhead for the current year will be $ 15,000,000 with 300,000 total machine hours . Year to date , the actual factory Xoverhead is $ 16,000,000 and the actual machine hours are 330,000 hours . If Thomlin Company uses a predetermined overhead rate based on machine hours for applying overhead , as of this point in time ( year to date ) , the overhead is
$ 500,000 overapplied
The amount of the average investment for a proposed investment of $ 120,000 in a fixed asset with a useful life of 4 years , straight - line depreciation , no residual value , and an expected total income of $ 21,600 for the 4 years is
$ 60,000
The effect on operating income if variable costing is used rather than absorption costing would be a ( n )
$ 80,000 decrease
A company is contemplating investing in a new piece of manufacturing machinery . The amount to be invested is $ 210,000 . The present value of the future cash flows is $ 225,000 . The company's desired rate of return used in the present value computations was 12 % . Which of the following statements is true ?
The internal rate of return on the project is more than 12 % .
A series of equal cash flows at fixed intervals is termed a ( n )
annuity
Ken and Laura are working toward implementing a balanced scorecard for their company . They ask their production and warehouse of the balanced scorecard . Which of the following suggestions teams to provide several options regarding strategic initiatives for the internal processes perspective made by the employees would be a good choice of a strategic initiative for this purpose ?
automate the warehouse
Which of the following are two methods of analyzing capital investment proposals that both ignore present value ?
average rate of return and cash payback
Miller and Sons ' static budget for 10,000 units of production includes $ 50,000 for direct materials , $ 44,000 for direct labor , variable utilities of $ 5,000 , and supervisor salaries of $ 24,000 . A flexible budget for 12,000 units of production would show
direct materials of $ 60,000 , direct labor of $ 52,800 , utilities of $ 6,000 , and supervisor salaries of $ 24,000
The triple bottom line approach to sustainability includes which of the following reporting categories ?
environmental performance , financial performance , and social performance
Question 4 Which of the following terms is used to describe the process by which managers monitor operations and compare actual and expected results ?
evaluation
Which of the following is a disadvantage of the average rate of return method ?
fails to consider the time value of money
T - Bone Company is contemplating investing in a new piece of manufacturing machinery . The amount to be invested is $ 150,000 . The present value of the future cash flows is $ 141,000 . Should the company invest in this project ?
no , because net present value is $ ( 9,000 )
Standards that represent levels of operation that can be attained with reasonable effort are called standards .
normal
Ana Carolina and Jaco , executive managers at Duke Manufacturing , are tasked with determining appropriate performance metrics for the customer perspective of Duke's balanced scorecard . Which of the following is the best metric for this situation ?
number of repeat customers
Waterfield Company is looking for a way to help its executive managers assess how its three divisions are meeting the company's goals and objectives for financial performance . Which of the following metrics might be used for this purpose ?
operating income and cash flows
Materials used by Square Yard Products Inc. in producing Division 3's product are currently purchased from outside suppliers at a cost of $ 5.00 per unit . However , the same materials are available from Division 6. Division 6 has unused capacity and can produce the materials needed by Division 3 at a variable cost of $ 3.00 per unit . A transfer price of 53.20 per unit is established , and 40,000 units of material are transferred , with no reduction in Division 6's current sales
$ 72,000
The standard costs and actual costs for direct materials for the manufacture of 2,500 actual units of product are as follows : The direct materials quantity variance is
$ 850 unfavorable
The investment turnover ( rounded to two decimal places ) for Mason Corporation is
1.08
The present value index is computed using which of the following formulas ?
Total Present Value of Net Cash Flow - Amount to Be Invested
manufacturing treats suppliers and customers as " arm's - length " independent entities .
Traditional
product Pinnacle Corp , budgeted $ 700,000 of overhead cost for the current year . Actual overhead costs for the year were $ hours . Actual machine hours were 80,000 . A total of 100,000 units was budgeted to be produced and 98,000 units were 650,000 . Pinnacle's plantwide allocation base , machine hours , was budgeted at 100,000 actually produced . Pinnacle's plantwide factory overhead rate for the current year is
$ 7.00 per machine hour
Woodpecker Co. has $ 296,000 in accounts receivable on January 1. Budgeted sales for January are $ 860,000 . Woodpecker Co. expects to sell 20 % of its merchandise for cash . Of the remaining 80 % of sales on account , 75 % are expected to be collected in the month of sale and the remainder the following month . The January cash collections from sales are
$ 984,000