acc practice

43,000 units (45,000+3,000-5,000)

Magnolia, Inc. has budgeted sales for the first quarter of the next year to be 45,000 units. The inventory on hand at the beginning of quarter is 5,000 units. The desired ending inventory is 3,000 units. Calculate the budgeted production for the first quarter

Absorption costing considers fixed manufacturing overhead to be period costs

Which of the following statements is true of absorption and variable costing methods?

$146,800 (20% x 150,000 + 80% x 60% x 150,000+ 80% x 40% x 140,000 = 146,800)

As of January 1 of the current year, the Grackle Company had accounts receivables of $50,000. The sales for January, February, and March were as follows: $120,000, $140,000 and $150,000. 20% of each month's sales are for cash. Of theremaining 80% (the credit sales), 60% are collected in the month of sale, with remaining 40% collected in the following month. What is the total cash collected (both from accounts receivable and for cash sales) in the month of March?

18% = 49,000/275,000

Avey Corporation had $275,000 in invested assets, sales of $330,000, income from operations amounting to $49,500 and a desired minimum rate of return of 7.5%. The rate of return on investment for Avey Corporation is:

$430,000 (SR-(VCGS+FCGS)-(VSAC+FSAC))

Calculate the operating income for August using absorption costing

$150

Holmes, Inc. has a division that manufactures a component that sells for $150 and has a variable cost of $45. Another division of the company wants to purchase the component. Fixed cost per unit of the component is $20. What is the transfer price if the division is operating at full capacity?

profit center

John Smith, one of the managers of a multi-national company, is responsible for generating revenues and controlling costs in order to increase the operating income of his division. However, he is not concerned about investment-related decisions. Brad is most likely to be the manager of a(n) ________

favorable flexible budget variance for fixed costs

A company is analyzing its month-end results by comparing it to both static and flexible budgets. During the previous month, the actual fixed costs were lower than the expected fixed costs as per the static budget. This difference results in a(n) ______

original cost of the old machine

A company is planning to replace an old machine with a new one. Which of the following is a sunk cost?

do not show possible changes in underlying activity levels

A disadvantage of static budgets (or fixed budgets) is that they

$744 U = (34.62 - 34) x 1,200 LH

Accurate Tax Returns budgets two direct labor hours for every tax return that it prepares, at a standard cost of $34 an hour. During the most recent year, 520 returns were completed with the labor cost totaling $18,000. The actual labor cost was $34.62 per hour during that period. The actual number of labor hours was 1,200. What is the direct labor cost variance (or rate variance)?

Production budget, Sales budget, Capital expenditures budget

Principal components of a master budget include which of the following?

variable costs of $52,800 and $25,000 of fixed costs variable cost: (budgeted cost) x (actual quantity)= ((40,000+4,000)/10,000) x 12,000=52,800. fixed cost: same (25,000)

Scott Manufacturing Co.'s static budget at 10,000 units of production includes $40,000 for direct labor and $4,000 for electric power. Total fixed costs are $25,000. At 12,000 units of production, a flexible budget would show

Sales Budget

The budget that needs to be completed first when preparing the master budget is the:

Cost Variance = (Actual Cost - Standard Cost) × Actual Quantity

Which of the following is the correct formula for measuring a cost variance (or a spending variance)?

expected results in the flexible budget for the actual units sold and the static budget

The sales volume variance is the difference between the ________

relates to production planning within the capacity limits in the short run

Variable costing is more appropriate than absorption costing when the decision

The actual cost of direct materials purchased was less than the standard cost of direct materials purchased.

What does a favorable direct materials cost variance (or price variance) indicate?

178 (DL+DM+FMO(VSAC/FSAC))

What is the unit product cost using absorption costing?

Variable costing

What term 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?

learning and growth

Which of the following four perspectives of the balanced scorecard enables management to answer the question, "How can we continue to improve and create value?"

It results in problems with achieving goal congruence.

Which of the following is a disadvantage of decentralization?

Managers' motivation and retention can be increased by empowering segment managers to make decisions.

Which of the following is an advantage of decentralization?

variable selling and administrative costs

Which of the following is considered a period cost under variable costing but not under absorption costing?