Cost

31,000

The number of equivalent units for direct materials in the assembly department for April calculated on the weighted-average basis is

39,840

The number of handles Mountain should purchase in October is

2,340

The number of tables to be produced by Rokat during August is

.43

All materials are added at the beginning of the process. Using the weighted-average method, the cost per equivalent unit for materials is

5,100

The number of units that Mountain finished during December is

10,000

All sales are made on credit and are collected in the second month following the sale. Purchases are paid in the month following the purchase, while operating costs are paid in the month that they are incurred. How much will Mountain Mule need to borrow at the end of the quarter if the company needs to maintain a minimum cash balance of $5,000, as required by a loan covenant agreement?

Sales budget

The operating budget process usually begins with the

Would normally gain added insights into causes of cost.

A company is considering the implementation of an activity-based costing and management program. The company

84,000

A firm desires a finished goods ending inventory equal to 25% of the following month's budgeted sales. January sales are budgeted at 10,000 units and February at 12,000 units. Each unit requires 2 pounds of Material X, which costs $4 per pound. The company has a just-in-time system and materials are delivered daily just prior to use, so no raw materials inventories are maintained. Materials are paid for in the month following purchase. The January 1 finished goods inventory is 2,500 units. In February, what amount should the company expect to pay as a cash outflow for raw materials?

Employee benefits expense.

A manufacturing company has several product lines. Traditionally, it has allocated manufacturing overhead costs between product lines based on total machine hours for each product line. Under a new activity-based costing system, which of the following overhead costs would be most likely to have a new cost driver assigned to it?

Jan: Same / Feb: Greater

A process costing system was used for a department that began operations in January. Approximately the same number of physical units, at the same degree of completion, were in work-in-process at the end of both January and February. Monthly conversion costs are allocated between ending work-in-process and units completed. Compared with the FIFO method, would the weighted-average method use the same or a greater number of equivalent units to calculate the monthly allocations?

42,400

A total of 8,000 bats were completed and transferred to the Finishing Department; the remaining 2,000 bats were still in the forming process at the end of the month. All of the Forming Department's direct materials were placed in process, but, on average, only 25% of the conversion cost was applied to the ending work-in-process inventory. The cost of the units transferred to the Finishing Department is

Underapplied by $2,000.

Actual manufacturing overhead for the month was $20,000. During the month, Mason completed Job Nos. 150 and 151. For the month, manufacturing overhead was

715,000

Ajax Company used a predetermined overhead rate using estimated overhead of $320,000 an d 8,000 estimated direct labor hours. Assume the only inventory balance is an ending finished goods balance of $9,000. What was cost of goods manufactured?

280,000

Ajax Company used a predetermined overhead rate using estimated overhead of $320,000 and 8,000 estimated direct labor hours. Assume the only inventory balance is an ending finished goods balance of $9,000. How much overhead was applied during the year?

110,800

Birch's estimated total cash collections during April from accounts receivable are

2,640,000

Assume Berol Company plans to produce 600,000 units of finished product in the 3-month period ending September 30 and to have direct materials inventory on hand at the end of the 3-month period equal to 25% of the use in that period. The estimated cost of direct materials purchases for the 3-month period ending September 30 is

388,000

Assume Superflite plans to manufacture 400,000 units in April. Superflite's April budget for the purchase of A-9 should be

Fixed costs.

At the breakeven point, the contribution margin equals total

5,200

Birk applies overhead to production at a predetermined rate of 80% of direct labor cost. Job No. 5, the only job still in process at month end, has been charged with direct labor of $2,000. What was the amount of direct materials charged to Job No. 5?

368,000

Black, Inc., employs a weighted-average method in its process costing system. Black's work-in-process inventory on June 30 consists of 40,000 units. These units are 100% complete with respect to materials and 60% complete with respect to conversion costs. The equivalent unit costs are $5.00 for materials and $7.00 for conversion costs. What is the total cost of the June 30 work-in-process inventory?

Unit variable costs are unchanged.

Breakeven analysis assumes that over the relevant range,

67,200

Collections from Montero Corp.'s customers are normally 70% in the month of sale, and 20% and 9%, respectively, in the 2 months following the sale. The balance is uncollectible. Montero takes full advantage of the 2% discount allowed on purchases paid for by the 10th of the following month. Purchases for May are budgeted at $60,000, and sales for May are forecasted at $66,000. Cash disbursements for expenses are expected to be $14,400 for the month of May. Montero's cash balance at May 1 was $22,000. What are Montero's expected cash collections during May?

67,320

Collections from Montero Corp.'s customers are normally 70% in the month of sale, and 20% and 9%, respectively, in the 2 months following the sale. The balance is uncollectible. Montero takes full advantage of the 2% discount allowed on purchases paid for by the 10th of the following month. Purchases for May are budgeted at $60,000, and sales for May are forecasted at $66,000. Cash disbursements for expenses are expected to be $14,400 for the month of May. Montero's cash balance at May 1 was $22,000. What are Montero's expected cash disbursements for May?

8,800

Company policy is to have a finished goods inventory at the end of each quarter equal to 20% of the next quarter's sales. Budgeted production for the second quarter of the next year would be

4,250

DJ Co. applies overhead at a predetermined rate of 90% of direct labor cost. Job No. 101, the only job still in process at the end of March, has been charged with manufacturing overhead of $2,250. What was the amount of direct materials charged to Job No. 101?

Volume-based production.

Each of the following should be considered in the selection of appropriate cost drivers for an activity-based costing system, except

46,400

Each unit of this product requires four pounds of raw materials. Johnson's policy is to have sufficient raw materials on hand at the end of each month for 40% of the following month's production requirements. The January 1 raw materials inventory is expected to conform with this policy. How many pounds of raw materials should Johnson budget to purchase for January?

3,200

Each unit of this product requires two pounds of direct materials. Dan's policy is to have sufficient direct materials on hand at the end of each month for 50% of the following month's production requirements. The January 31 direct materials inventory is expected to conform with this policy. How many pounds of direct materials should Dan plan to purchase for February?

665,720

Fact Pattern: Berol Company plans to sell 200,000 units of finished product in July and anticipates a growth rate in sales of 5% per month. The desired monthly ending inventory in units of finished product is 80% of the next month's estimated sales. There are 150,000 finished units in inventory on June 30. Each unit of finished product requires 4 pounds of direct materials at a cost of $1.20 per pound. There are 800,000 pounds of direct materials in inventory on June 30. Berol Company's production requirement in units of finished product for the 3-month period ending September 30 is

78,000

Fact Pattern: Streeter Company produces plastic microwave turntables. Sales for the next year are expected to be 65,000 units in the first quarter, 72,000 units in the second quarter, 84,000 units in the third quarter, and 66,000 units in the fourth quarter. Streeter usually maintains a finished goods inventory at the end of each quarter equal to one half of the units expected to be sold in the next quarter. How many units should Streeter produce in the second quarter?

accommodate changes in activity levels.

Flexible budgets

540,000

Hannon Retailing Company prices its products by adding 30% to its cost. Hannon anticipates sales of $715,000 in July, $728,000 in August, and $624,000 in September. Hannon's policy is to have on hand enough inventory at the end of the month to cover 25% of the next month's sales. What will be the cost of the inventory that Hannon should budget for purchase in August?

2,000

How much is Korn's breakeven point in units?

24%

If prime costs increased by 20% and all other values remained the same, Oradell Company's contribution margin (to the nearest whole percent) would be

Work-in-process control

In a job-order cost system, the use of direct materials previously purchased usually is recorded as an increase in

Current costs plus cost of beginning work-in-process inventory.

In the computation of manufacturing cost per equivalent unit, the weighted-average method of process costing considers

The expense of obtaining cost data is relatively high.

Limitations of an activity-based costing system include which of the following?

24,800

Materials are introduced at the end of the process in Department Y. There were 4,000 units (40% complete as to conversion costs) in WIP at March 31. The total costs assigned to the March 31 WIP inventory should be

186,000

Mien Co. is budgeting sales of 53,000 units of product Nous for next month. The manufacture of one unit of Nous requires 4 kilos of chemical Loire. During the month, Mien plans to reduce the inventory of Loire by 50,000 kilos and increase the finished goods inventory of Nous by 6,000 units. There is no Nous work-in-process inventory. How many kilos of Loire is Mien budgeting to purchase next month?

30,000

Nil Co. uses a predetermined factory overhead application rate based on direct labor cost. For the year ended December 31, Nil's budgeted factory overhead was $600,000, based on a budgeted volume of 50,000 direct labor hours, at a standard direct labor rate of $6 per hour. Actual factory overhead amounted to $620,000, with actual direct labor cost of $325,000. For the year, overapplied factory overhead was

20.00

Overhead was estimated to be $400,000 for the year along with 20,000 direct labor hours. Actual overhead was $415,000, actual labor hours were 21,000. The predetermined overhead rate would be

14.25

Overhead was applied at the rate of $50 per direct labor hour, and job J-1 required 400 direct labor hours. If job J-1 resulted in 4,000 good dresses, the cost of goods sold per unit is

420,000

Overhead was estimated to be $400,000 for the year along with 20,000 direct labor hours. Actual overhead was $415,000, actual labor hours were 21,000. The amount of overhead applied to production would be

24,000

Product Cott has sales of $200,000, a contribution margin of 20%, and a margin of safety of $80,000. What is Cott's fixed cost?

Increase total unit cost.

Purchased direct materials are added in the second department of a three-department process. This addition does not increase the number of units produced in the second department and will

1,393,750

Ryan's terms are net 30 days. The company typically receives payment on 80% of sales the month following the sale, and 17% is collected 2 months after the sale. Approximately 3% of sales are deemed bad debt. What amount represents the expected cash collection in the second calendar quarter of next year?

5,000

Sisk's breakeven point in number of units is

648

Snyder Co. manufactures fans with direct material costs of $10 per unit and direct labor of $7 per unit. A local carrier charges Snyder $5 per unit to make deliveries. Sales commissions are paid at 10% of the selling price. Fans are sold for $100 each. Indirect factory costs and administrative costs are $6,800 and $37,200 per month, respectively. How many fans must Snyder produce to break even?

85,000

Swan Company is a maker of men's slacks. The company would like to maintain 20,000 yards of fabric in ending inventory. The beginning fabric inventory is expected to contain 25,000 yards. The expected yards of fabric needed for sales is 90,000. Compute the yards of fabric that Swan needs to purchase.

Decrease the fixed costs and increase the contribution margin.

The most likely strategy to reduce the breakeven point would be to

by application as to the levels of cost hierarchy.

The basic principles and concepts of variance analysis can be applied to activity-based costing

Increase and sales price remains unchanged.

The breakeven point in units increases when unit costs

264

The budgeted cost to manufacture one ultrasound machine using the activity-based costing method is

7,600

The cost of the work-in-process inventory in the Forming Department at the end of May is

121,500

The ending inventory was 25% complete as to the conversion cost. At the beginning of the process, 100% of direct material was added. What was the total cost transferred out?

Cash budget.

The preparation of a comprehensive master budget culminates with the preparation of the

757,500

Under Worley's cost accounting system, over- or underapplied overhead is assigned to appropriate inventories and COGS based on year-end balances. In its year-end income statement, Worley should report COGS of

Completed during the period.

Under a job-order system of cost accounting, the dollar amount of the general ledger entry involved in the transfer of inventory from work-in-process to finished goods is the sum of the costs charged to all jobs

2.25

Under the FIFO method, Albany Mining's cost per equivalent unit for materials is

208,000

Under the FIFO method, Albany Mining's equivalent units of production (EUP) with respect to materials are

3.00

Under the weighted-average method, Albany Mining's equivalent-unit conversion cost for May is

2.92

Using the FIFO method, Albany Mining's cost per equivalent unit for conversion costs is

156,960

Using the weighted-average method, Albany Mining's total cost of work-in-process inventory at May 31 is

40,000

What is the expected cash balance of the company at the end of the coming month?

Process costing.

Which costing method is most likely to distort costs?

Activity-based costing.

Which of the following cost methods is least likely to result in cost shifting in a multiproduct manufacturing environment?

Selling expense budget.

Which of the following is normally included in the operating budget?

II, III, I, IV.

Which one of the combinations listed correctly depicts the chronological order of preparation for the following budgets? I.Cost of goods sold budget II.Production budget III.Purchases budget IV.Administrative budget

Revenue budget, production budget, direct material budget.

Which one of the following best describes the order in which budgets should be prepared when developing the annual master operating budget?

Set out long-range, strategic concepts.

While an operating budget is a key element in planning and control, it is not likely to

Budgets without evaluation of possibilities and constraints are not achievable goals.

Why would a manufacturer compare results with budgets?