Managerial Accounting Final Flash Cards

The following data have been provided by a retailer that sells a single product. What is the best estimate of the company's variable selling and administrative expense per unit?

$0.24 per unit

Holzhauer Corporation; The gross margin for March is:

$1,360,000

Parmentier Company; What was the cost per equivalent unit for conversion costs for January in the Molding Department? (Round off to three decimal places.)

$1.752

Oriental Company; The net present value of this investment would be:

$107,250

Meharg Corporation; The present value of the annual cost savings of $30,000 is closest to:

$113,730

Scheney Company; the total cost in the March 31 work in process inventory was:

$116,500

The following data pertain to an investment proposal:; What is the net present value of the project, using a discount rate of 8 percent?

$2,566

An investment of P dollars; If the internal rate of return for this investment is 20%, then the value of P is:

$3,463

Mcclam, Inc.; The net present value of the proposed project is closest to:

$3,833

Mercredi, Inc.; How large would the annual net cash inflows from the intangible benefits have to be to make this a financially acceptable investment?

$35,000

Spendlove Corporation; the product margin for product S78N is:

$4,116.50

Crinks Corporation; Overhead at the end of the year was:

$4,280 underapplied

Goldbach Corporation; What would be the total maintenance and repair cost, both fixed and variable, at an activity level of 4,600 units in a month?

$420,992

Melchiori Corporation; The present value of the annual cost savings of $116,000 is closest to:

$427,460

Modugno Corporation; In making the decision to invest in the model 240 machine, the opportunity cost was:

$430,000

During the month of September, direct labor cost totaled $11,000 and direct labor cost was 40% of prime cost. If total manufacturing costs during September were $73,000, the manufacturing overhead was:

$45,500

Slappy Corporation; What should be the total lease cost at a sales volume of 16,900 units in a month?

$482,000

Trybus Corporation; how large would the salvage value of the automated equipment have to be to make the investment in the automated equipment financially attractive?

$491,101

Emilio Corporation; What would be the total variable cost at an activity level of 3,500 units?

$60,795

Blore Corporation; What would be the total cost, both fixed and variable, at an activity level of 7,500 units?

$602,475

Iadanza Corporation; The best estimate of the total contribution margin when 6,300 units are sold is:

$638,190

Gimenez Corporation; how large would the annual cash inflow have to be to make the investment in the equipment financially attractive?

$69,930

Trybus Corporation; how large would the additional cash flow per year from the intangible benefits have to be to make the investment in the automated equipment financially attractive?

$71,400

Babuca Corporation; The best estimate of the total variable manufacturing cost per unit is:

$82.00

Salada Corporation; What was the absorption costing net operating income last year?

$83,000

Vanartsdalen Corporation; Using the high-low method to estimate the variable and fixed components of this cost, these estimates would be closest to:

$9.35 per machine-hour; $11,885 per month

Mennig Corporation; The unit product cost under variable costing is:

$92

Pattee Corporation; The profitability index of investment project N is closest to:

0.10

Altro Corporation; The profitability index of investment project S is closest to:

0.17

Hazel Corporation; The equivalent units for conversion costs was:

112,000 units

The Work in Process inventory account of a manufacturing firm ; From this information, it appears that the company is using a predetermined overhead rate, as a percentage of direct labor costs, of:

120%

If an investment of $14,760 now will yield $18,000 at the end of one year, then the internal rate of return for this investment to the nearest whole percentage is:

22%

Gull Inc; The payback period of this investment is closest to:

3.1 years

Oriental Company; The payback period for the investment would be:

4 years

Berol Company; Berol Company's production requirement in units of finished product for the three-month period ending September 30 is:

665,720 units

Reichelderfer Corporation; Which of the following statements is true?

Actual manufacturing overhead for the month was $50,000.

Which of the following are considered to be product costs under absorption costing?

I and II.

Which of the following are considered to be product costs under variable costing?

I.

Pattee Corporation; Rank the projects according to the profitability index, from most profitable to least profitable.

M, O, N

Which of the following is correct with respect to closing out overapplied manufacturing overhead to Cost of Goods Sold versus closing it out to Cost of Goods Sold and Finished Goods and Work in Process inventories?

Net operating income will be higher if all of the overapplied manufacturing overhead is closed out to Cost of Goods Sold.

Spring Company; Which of the following statements would be true?

Only II

Which of the following costs is often important in decision making, but is omitted from conventional accounting records?

Opportunity cost.

The discount rate must be specified in advance for which of the following methods?

Option B

All other things the same, which of the following would be true of the contribution margin and variable expenses of a company with high fixed costs and low variable costs as compared to a company with low fixed costs and high variable costs?

Option C

East Company; What is the effect on the contribution margin per unit and the contribution margin ratio?

Option C: CM per unit increase, CM ratio no change

Would the following activities at a manufacturer of canned soup be best classified as unit-level, batch-level, product-level, or organization-sustaining activities?

Option D

Property taxes are an example of a cost that would be considered to be:

Organization-sustaining.

The salary of the president of a manufacturing company would be classified as which of the following?

Period cost

Altro Corporation; Rank the projects according to the profitability index, from most profitable to least profitable.

S, T, R

Which of the following activities would be classified as a batch-level activity?

Setting up equipment.

Marple Company; This oversight will cause:

The Cost of Goods Manufactured to be understated.

Which one of the following statements about the payback method of capital budgeting is correct?

The payback method does not consider the time value of money.

Which of the following costs is an example of a period rather than a product cost?

Wages of salespersons.

Under variable costing, costs that are treated as period costs include:

all fixed costs.

A portion of the total fixed manufacturing overhead cost incurred during a period may:

be excluded from cost of goods sold under absorption costing.

Kirson Corporation; The journal entry to record the application of Manufacturing Overhead to Work in Process would include a:

credit to Manufacturing Overhead of $92,000

If an investment has a project profitability index of 0.15, then the:

net present value of the project is positive.

Wert Corporation; For the year, manufacturing overhead was:

overapplied by $60,000

The salary paid to the production manager in a factory is:

part of conversion cost.

An example of a committed fixed cost is:

property taxes on the factory building.

Variable cost:

remains constant on a per unit basis as the number of units produced increases.

The term "relevant range" means the range of activity over which:

the assumptions about fixed and variable cost behavior are reasonably valid.

All other things equal, if a division's traceable fixed expenses decrease:

the division's segment margin will increase.

If investment A has a payback period of 3 years and investment B has a payback period of 4 years, then:

the relation between investment A's net present value and investment B's net present value cannot be determined from the given information.

Equivalent units for a process costing system using the weighted-average method would be equal to:

units completed during the period plus equivalent units in the ending work in process inventory.

If the internal rate of return is used as the discount rate in computing net present value, the net present value will be:

zero.