Complete Assignments of Courses of Leading Universities: BU330 Accounting for Manager

BU330 Accounting for Manager

Ashworth College

Ashworth Semester Exam BU330 Accounting for Managers 2020

Question 1
Internal parties receive information about past performance from:
audit reports.
budget reports.
planning reports.
managerial accounting reports.

Question 2
The IMA issues which of the following certifications?
CMA
CIA
CFP
CPA

Question 3
A ________ is used to accumulate all of the direct materials and direct labor used on the job, as well as the manufacturing overhead allocated to the job.
bill of materials
job cost record
labor time record
production schedule

Question 4
If a job consists of a batch of identical units, how can managers find the unit cost?
By tracing direct materials to each unit
By multiplying the total job cost by the number of units in the job
By dividing the total job cost by the number of units in the job
By tracing direct labor to each unit

Question 5
Process costing is MOST likely used in which of the following industries?
Pharmaceuticals
Health Care
Shipbuilding
Construction

Question 6
When using the income statement approach to finding breakeven, which of the following is TRUE?
(variable expenses × number of units) - fixed expenses = operating income
sales revenue - variable expenses - fixed expenses = operating income
fixed expenses + variable expenses + sales revenue = operating income
fixed expenses + variable expenses - sales revenue = operating income

Question 7
Which of the following budgets usually shows separate sections for fixed and variable costs?
Direct materials and manufacturing overhead budget
Manufacturing overhead budget and production budget
Production budget and manufacturing overhead budget
Operating expenses budget and manufacturing overhead budget

Question 8
Standards should be reviewed and adjusted at least:
yearly.
monthly.
weekly.
daily.

Question 9
The formula for calculating the accounting rate of return for a capital asset is:
average annual operating income from asset/amount invested in asset.
average annual net cash inflow from asset/amount invested in asset.
(average annual operating income + depreciation expense)/amount invested in asset.
(average annual cash inflows - depreciation expense)/(amount invested in asset + residual value of asset).

Question 10
if a company uses the indirect method to prepare the statement of cash flows, how will the adjustment to reflect the amount of cash received from customers be presented on the statement?
The adjustment will be for the increase or decrease in inventory during the period and will adjust net income in the operating activities section on the statement of cash flows.
The adjustment will be for the increase or decrease in accounts payable during the period and will adjust net income in the operating activities section on the statement of cash flows.
The adjustment will be for the increase or decrease in accrued expenses during the period and will adjust net income in the operating activities section on the statement of cash flows.
The adjustment will be for the increase or decrease in accounts receivable during the period and will adjust net income in the operating activities section on the statement of cash flows.

BU330C Assignment 4

Assignment 04

BU330 Accounting for Managers

Directions: Be sure to make an electronic copy of your answer before submitting it to Ashworth College for grading.

Factoring resource constraints into product mix decisions

Rose Incorporated manufactures two types of vases, small and large. The following per-unit data are available.

Small Vase Large Vase

Sale price $60 $100

Variable costs $35 $60

Machine hours required for 1 vase 1 2

Total fixed costs are $600,000, and Rose Incorporated can sell a maximum of 25,000 units of each type of vase annually. Machine hour capacity is 50,000 hours per year.

a. Determine the contribution margin per unit for each type of vase.

b. Determine the contribution margin per machine hour for each type of vase.

c. Determine the number of units of each style of vase that Rose Incorporated should produce to maximize operating income.

d. What is the dollar amount of the maximum operating income as calculated in C above?

BU330C Assignment 8

Assignment 08

BU330 Accounting for Managers

Directions: Be sure to make an electronic copy of your answer before submitting it to Ashworth College for grading.

Financial Statement Analysis

The following information relates to Harris Corporation.

Account	Current year	Prior year
Net sales (all credit)	$520,125	$499,500
Cost of goods sold	$375,960	$353,600
Gross profit	$144,165	$145,900
Income from operations	$ 95,500	$ 79,900
Interest expense	$ 23,500	$ 19,500
Net income	$ 57,600	$ 51,600
Cash	$ 30,600	$ 15,900
Accounts receivable, net	$ 33,800	$ 23,200
Inventory	$ 42,000	$ 30,300
Prepaid expenses	$ 2,000	$ 1,500
Total current assets	$ 108,400	$ 70,900
Total long-term assets	$ 62,000	$ 38,000
Total current liabilities	$ 46,000	$ 41,600
Total long-term liabilities	$ 20,000	$ 22,700
Common stock, no par, 3,000 shares, value $50/share	$ 30,000	$ 30,000

Required:

a. What is the acid-test ratio for the current year?

b. What is the inventory turnover for the current year?

c. What is days' sales in receivables for the current year?

d. What is the book value per share of common stock for the current year?

e. What is the price-earnings ratio for the current year?

f. What is the rate of return on total assets for the current year?

g. What is the times-interest-earned ratio for the current year?

h. What is the current ratio for the current year?

BU330 Week 1 Threaded Discussion

Discuss why each of the four broad ethical standards in the IMA's Statement of Ethical Professional Practice is necessary.

(154 words)

BU330 Accounting for managers Exam Part 1

Question-1

Management accounting

A) Deals primarily with people and organizations outside of the business entity.

B) Requires only periodic reporting on a regular basis.

C) Uses any type of useful measurement unit, including physical as well as monetary measures.

D) Deals only with the double-entry recording system

Question-2

Which of the following type of information is not essential for a manager to run a business effectively?

Product or service costing information

Data for planning and controlling of operations

Special reports and analysis to support decisions

Quote of the current price of the company's stock

Question-3

Accumulating, interpreting, and reporting financial information is important for:

a. service-related firms only.

b. manufacturing firms only.

c. virtually all types of organizations.

d. not-for-profit organizations only.

4. The unit of measurement used in management accounting is:

a. primarily the historical dollar.

b. usually current replacement cost.

c. any measurement unit that is useful in a particular situation.

d. the measurement unit used by competing companies.

5. Which of the following would not be included in the cost of a manufactured Product?

a. Cost to ship products to a customer

b. Cost of factory machinery used in production

c. Cost to design the product

d. Plant supervisor's salary

6. Which of the following is not included in the purchase cost of merchandise inventory?

a. Purchase discounts

b. Overhead costs

c. Freight-in costs

d. Purchase returns and allowances

7. Depreciation expense could be:

a. a period cost.

b. a product cost.

c. a fixed cost.

d. All of the above

8. The three costs in every product are:

a. direct materials, work in process, and overhead.

b. direct materials, work in process, and finished goods.

c. direct materials, direct labor, and overhead.

d. direct materials, direct labor, and period costs.

9. The type of product costing system used by a company is dictated by the:

a. project manager.

b. production process.

c. company president.

d. plant supervisor.

10. Product costs appear on the income statement in the form of:

a. cost of goods sold.

b. materials inventory.

c. sales commissions.

d. None of the above

11. If there is a debit balance in the Factory Payroll account at the end of the accounting period, it represents:

a. an amount because applied payroll was greater than actual payroll.

b. an amount because actual payroll was greater than applied payroll.

c. labor costs which have not yet been distributed.

d. an amount which should be charged to Cost of Goods Sold.

12. A process costing system assigns costs to products:

a. individually.

b. according to which products can absorb the most costs and still be profitable.

c. randomly.

d. equally.

13. Which of the following accurately describes a difference between job order and process costing systems?

a. In job order costing systems, overhead costs are treated as product costs, whereas in process costing systems, overhead costs are treated as period costs.

b. Job order costing systems do not need to assign costs to production, whereas process costing systems do.

c. In job order costing systems, costs are traced to products, whereas in process costing systems, a FIFO method may be used.

d. Since costs are assigned to products in a job order costing system, selling costs are treated as product costs in the job order costing system, whereas they are treated as period costs in process costing systems.

14. Which of the following statements is true?

a. The Work in Process Inventory account is the focal point of process costing.

b. To compute unit costs using the FIFO costing method, total costs of direct materials, direct labor, and overhead that have been accumulated in the Work in Process Inventory account or accounts are divided by the units worked on during the period.

c. Equivalent units usually are computed for direct materials and manufacturing overhead combined.

d. Labor costs are accounted for differently from manufacturing overhead costs in a process costing system.

15. Full product cost includes:

a. all direct labor and direct material costs and all production and nonproduction costs.

b. only nonproduction costs.

c. only the costs of direct material.

d. only the costs of direct labor.

16. Customer relations are usually part of:

a. the supply chain.

b. the value chain.

c. both the value chain and the supply chain.

d. neither the value chain nor the supply chain.

17. Which of the following activities would be part of the supply chain of a manufacturer?

a. Shipping

b. Customer service

c. Parts manufacturing

d. Research and development

18. Nonvalue-adding activities are:

a. unnecessary activities.

b. included in the value chain of activities.

c. all wasteful and targeted for elimination.

d. not all wasteful and may not be targeted for elimination.

19. Which of the following would not require the use of cost behavior analysis?

a. Transferring production costs from one department to another

b. Projecting anticipated costs of a new project

c. Buying an existing business

d. Changing an existing product or service

20. Which of the following statements most accurately explains the behavior of costs?

a. There is no norm; rather, costs can be fixed, variable, or a combination of both.

b. The majority of costs are variable per unit of production.

c. The majority of costs are fixed per unit of production.

d. Costs can be fixed or variable but usually not a combination of both.

21. Which of the following statements is true regarding fixed and variable costs?

a. Both costs are constant when considered on a total basis.

b. Variable costs are constant in total, and fixed costs are constant per unit.

c. Both costs are constant when considered on a per unit basis.

d. Fixed costs are constant in total, and variable costs are constant per unit.

22. Budgets:

a. should contain both revenues and expenses.

b. contain as much information as possible.

c. are presented in dollars only; nondollar data should be excluded.

d. are synonymous with managing an organization.

23. Budgets identify, gather, summarize, and communicate:

a. financial data only.

b. financial and nonfinancial data.

c. nonfiriancial data only.

d. None of the above

24. After management has set short-term goals, the budgeting process typically starts with:

a. a clearly defined timetable of events.

b. input only from the accounting personnel.

c. the naming of an efficient coordinator or director.

d. a set of procedures or instructions.

25. Which of the following represents a basic stakeholder of an organization?

a. The account receivable clerk of the organization

b. A vice president of the organization

c. A line supervisor of the organization

d. All of the above

BU330 Exam Accounting for Managers Part-2

1. By balancing all stakeholders' needs, managers are more likely to achieve their objectives in:

a. the long term.

b. the short telID.

c. the short term as well as the long term.

d. all areas of the organization.

2. Which of the following is an example of a performance measurement?

a. Product quality

b. Number of customer complaints

c. Customer satisfaction

d. All of these choices

3. In a standard costing system, standard costs eventually flow into the:

a. Cost of Goods Sold account.

b. Standard Cost account.

c. Selling and Administrative Expenses account.

d. Sales account.

4. Service organizations do not develop standards for:

a. any service costs.

b. overhead.

c. direct materials.

d. labor.

5. A standard costing system:

a. is not typically used by management for cost planning and cost control purposes.

b. is a system in which all costs affecting the three inventory accounts and the Cost of Goods Sold account are stated in terms of actual costs incurred.

c. depends on actual costs rather than planned costs.

d. is employed with an existing job order costing or process costing system and is not a full cost accounting system in itself.

6. Cost information for short-run decision making focuses on:

a. why it happened.

b. what is happening.

c. what happened.

d. what will happen.

7. Qualitative factors used by decision makers include all of the following except:

a. social issues.

b. competition.

c. annual or projected revenues.

d. timeliness.

8. All management decisions should be supported by:

a. analysis of alternative courses of action.

b. stockholder approval.

c. . analysis of one course of action.

d. detailed analysis of relevant data, usually consisting of past costs and revenues.

9. An example of a pricing objective is to:

a. have prices that top the market.

b. maintain or gain market share.

c. maximize losses.

d. minimize quality and cost.

10. To stay in business, a company must have a selling price that is:

a. acceptable to the customer.

b. able to recover the variable costs of production.

c. the highest in the marketplace.

d. equal to or lower than the company's costs per unit.

11. When making the decision on a product's price, the manager must consider:

a. all products at the same time.

b. the minimum price that will produce a profit.

c. only cost-based information.

d. the product's total variable costs.

12. All of the following are capital investment decisions, except whether or not to:

a. replace old equipment.

b. issue stock to raise capital.

c. acquire another company.

d. add a new product line.

13. Which of the following items can be described as a noncash expense?

a. Wages

b. Advertising

c. Income taxes

d. Depreciation

14. The primary focus of a management information system is on the management of:

a. people.

b. costs.

c. activities.

d. time.

15. Information captured by a management information system allows managers to do all of the following except:

a. determine accurate product or service costs.

b. improve processes.

c. provide timely feedback.

d. satisfy all customer inquiries.

16. How does an ERP system differ from an MIS?

a. The ERP system informally links the different areas of management for specific purposes.

b. There is no difference.

c. The ERP system combines all areas of management into one centralized data warehouse.

d. The ERP system can be used only in a service business.

17. The overall objective of controlling the costs of quality is to eliminate:

a. appraisal costs.

b. costs of nonconformance.

c. costs of conformance.

d. the costs of quality.

18. Service department costs are allocated so that:

a. budgeting purposes are fulfilled.

b. they can be properly managed.

c. a business can then assess the profitability of a product or service.

d. they will have a zero balance at the end of the accounting period.

19. Which of these would not be considered an activity center in a warehouse operation?

a. Receiving

b. Distribution

c. Facility Maintenance

d. Product Design

20. Which of the following is not a directly traceable cost to a store in a restaurant chain?

a. Food prepared in the store

b. Company newsletter and website

c. Manager's salary

d. Wait staff

21. Joint costs are:

a. incurred prior to the separation of joint products.

b. incurred after separation of joint products.

c. incurred prior and after separation of joint products.

d. None of the above

22. Executive officers' compensation is typically comprised of all of the following except:

a. incentive bonuses.

b. declared dividends.

c. stock option awards.

d. annual base salaries.

23. Market strength refers most closely to the ability to:

a. survive for many years.

b. pay bills when they fall due.

c. earn a satisfactory net income.

d. increase the wealth of stockholders.

24. The ability to pay bills when due and to meet unexpected needs for cash most closely describes:

a. cash flow adequacy.

b. long-term solvency.

c. liquidity.

d. profitability.

25. Financial performance measurement is useful for all of the following except assessment of:

a. accounting methods.

b. return by investors.

c. risk by creditors.

d. risk by investors.

BU330 Online Exam 2_03 SCORE 100 PERCENT

Question 1 of 20

5.0 Points

Watson's Computer Company uses ABC to account for its manufacturing process.

Activities	Indirect activity budget	Allocation base (cost driver)
Materials handling	$52,000	Based on number of parts
Machine setup	30,000	Based on number of setups
Assembling	9,750	Based on number of parts
Packaging	15,300	Based on number of finished units

Watson's Computer Company expects to produce 2,250 computers. Watson's Computer Company also expects to use 13,000 parts and have 20 setups. The allocation rate for materials handling will be:

A. $4.

B. $6.80.

C. $23.11.

D. $7.01.

Question 2 of 205.0 Points

Which term listed below describes a system where companies purchase raw materials when needed in production and complete finished goods when needed by customers?

A. Internal failure costs

B. Backflush costing

C. Just-in-time

D. External failure costs

Question 3 of 205.0 Points

The entry to record the purchase of raw materials on account using a job costing system would include a:

A. credit to work-in-process inventory.

B. debit to accounts payable.

C. debit to work-in-process inventory.

D. debit to raw materials inventory.

Question 4 of 205.0 Points

If jobs have been under costed due to under allocation of manufacturing overhead, then cost of goods sold (COGS) is too low and which of the following corrections must be made?

A. Decrease COGS for the amount of the under allocation

B. Increase COGS for double the amount of the under allocation

C. Decrease COGS for double the amount of the under allocation

D. Increase COGS for the amount of the under allocation

Question 5 of 205.0 Points

Which of the following is a lean strategy?

A. Group like machines together.

B. Produce in smaller batches than a traditional system.

C. Maintain a higher level of inventory than a traditional system.

D. Lengthen setup times relative to a traditional system.

Question 6 of 205.0 Points

In job costing, the journal entry to record the use of direct materials on jobs is to debit work-in-process inventory and credit:

A. raw materials inventory.

B. finished goods inventory.

C. manufacturing overhead.

D. wages payable.

Question 7 of 205.0 Points

The predetermined indirect cost allocation rate is computed as:

A. total estimated indirect costs / total estimated amount of the allocation base.

B. total amount of the allocation base / total estimated indirect costs.

C. total estimated indirect costs + total estimated amount of the allocation base.

D. total amount of the allocation base - total estimated indirect costs.

Question 8 of 205.0 Points

The cost of downtime caused by quality problems with the raw materials would be classified as what type of cost?

A. Prevention cost

B. Appraisal cost

C. External failure cost

D. Internal failure cost

Question 9 of 205.0 Points

Which of these documents informs the storeroom to send specific materials to the factory floor?

A. Receiving report

B. Bill of materials

C. Purchase order

D. Materials requisition

Question 10 of 205.0 Points

A system that focuses on activities as the fundamental cost object and uses the costs for these activities to compile indirect costs of goods and services is:

A. appraisal costs.

B. value engineering.

C. activity-based costing.

D. prevention costs.

Question 11 of 205.0 Points

Service firms develop a predetermined rate for some costs. This rate is called the:

A. labor rate.

B. direct cost rate.

C. indirect cost allocation rate.

D. hourly cost rate.

Question 12 of 20

5.0 Points

Kramer Company manufactures coffee tables and uses an activity-based costing system to allocate all manufacturing conversion costs. Each coffee table consists of 20 separate parts totaling $240 in direct materials, and each requires 5 hours of machine time to produce. Additional information follows.

Activity	Allocation Base	Cost Allocation Rate
Materials handling	Number of parts	$2.00 per part
Machining	Machine hours	$2.75 per machine hour
Assembling	Number of parts	$1.00 per part
Packaging	Number of finished units	$3.00 per finished unit

What is the cost of machining per coffee table?

A. $15

B. $21

C. $13.75

D. $55

Question 13 of 205.0 Points

The benefits of using the ABC costing system are higher if the company:

A. has high indirect costs.

B. produces many different products that use differing amounts of resources.

C. has high indirect costs and produces many different products that use differing amounts of resources.

D. produces only one product.

Question 14 of 205.0 Points

The first step in developing an ABC system is:

A. calculate an activity cost allocation rate for each activity.

B. allocate the costs to the cost object using the activity cost allocation rates.

C. select an allocation base for each activity.

D. identify the primary activities and estimate a total cost pool for each.

Question 15 of 205.0 Points

Showboat Corporation had actual manufacturing overhead costs for the most recent year of $29,500. Manufacturing overhead is allocated using a predetermined manufacturing overhead rate of $1.50 per direct labor hour. Direct labor cost is $19 per hour. At the end of the year, Cabaret Corporation found it had over allocated manufacturing overhead by $1,250. How much manufacturing overhead was allocated in total during the year?

A. $28,250

B. $29,500

C. $30,750

D. $1,250

Question 16 of 205.0 Points

Venus Crates manufactures custom crates for a variety of uses. The following data have been recorded for Job 551, which was recently completed. Direct materials used cost $7,200. There were 82 machine hours used on this job. The predetermined overhead rate is $30 per machine hour used. There were 175 direct labor hours worked on this job at a direct labor wage rate of $24 per hour. What is the total manufacturing cost of Job 551?

A. $13,860

B. $4,200

C. $2,460

D. $7,457

Question 17 of 205.0 Points

A(n) ________ is an estimated manufacturing overhead rate computed before the year begins.

A. cost allocation

B. cost driver

C. predetermined manufacturing overhead rate

D. actual manufacturing overhead rate

Question 18 of 205.0 Points

Which of the following is a result of cost distortion?

A. Over costing of all products

B. Under costing of all products

C. Accurate costing of all products

D. Over costing of some products and under costing of other products

Question 19 of 20

5.0 Points

Here are selected data for Sunny Sky Corporation.

Beginning raw materials inventory	$37,000	Beginning work-in-process inventory	$62,200
Beginning finished goods inventory	58,300	Cost of materials purchased	151,000
Cost of direct materials requisitioned	91,300	Direct labor incurred	135,000
Actual manufacturing overhead	160,000	Cost of goods manufactured	287,000
Cost of goods sold	265,000	Manufacturing overhead rate (% of direct labor)	125%

What is the ending work-in-process inventory balance?

A. $161,500

B. $170,250

C. $211,200

D. $229,950

Question 20 of 205.0 Points

Which term listed below describes costs incurred when the company fails to detect poor quality goods or services before delivery to the customer?

A. Internal failure costs

B. Value-added activity

C. External failure costs

D. Just-in-time production

BU330 Accounting for Managers Set-1

Question- 1

Lots of Stuff Company reports the following data for its first year of operation.

Work in process inventory, beginning	$0
Work in process inventory, ending	140,000
Direct materials used	110,000
Direct Labor	115,000
Manufacturing overhead	185,000
Finished goods inventory, beginning	0
Finished goods inventory, ending	90,000

What are the total manufacturing costs?

A. $455,000

B. $410,000

C. $750,000

D. $520,000

Question- 2

Porches, Inc., sells lawn furniture. Selected financial information for the most recent year follows.

Beginning merchandise inventory on January 1 was $33,000.
Ending merchandise inventory on December 31 was $35,000.
Purchases during the year were $92,000.
Selling and administrative expenses were $75,000.
Sales for year were $262,000.

What was the value of goods available for sale?

A. $125,000

B. $127,000

C. $170,000

D. $ 90,000

Question- 3

Which of the following costs could be found in work in process inventory for a candy bar manufacturer?

A. Assembly worker wages

B. Utilities for administrative offices

C. Depreciation on sales office

D. Customer order forms

Question- 4

__________ gathers, summarizes, and reports on the financial impact of changes to business operations.

A. Managerial accounting

B. Planning

C. Directing

D. Controlling

Question- 5

Evaluating results against the plan is an example of which of the following management functions?

A. Planning

B. Controlling

C. Analyzing

D. Directing

Question- 6

Which of the following is NOT an example of an indirect cost incurred in manufacturing automobiles?

A. Plant supervisor salary

B. Machinery depreciation in the factory

C. Plant utilities

D. Cost of the automobile engines

Question- 7

Which of the following people is most likely to use only financial accounting information?

A. Vice president of plant operations

B. Product manager

C. Plant manager

D. Bank loan officer

Question- 8

Winner's Sporting Equipment manufactures sporting goods. Selected costs from the past year include the following.

Plastics used to make products	$151,000
Heating and lighting costs for factory	65,000
Factory janitor wages	67,000
Costs of shipping to customers	11,000
Lubricants used in factory equipment	2,000
Lighting costs for sales office	20,000
Depreciation on factory equipment	23,000
Office supplies for sales office	6,000
Insurance costs for factory	13,000
Maintenance worker wages	99,000
Freight-in (on plastics)	7,500
Aluminum used to make products	175,000
Assembly-line worker wages	142,000
Salaries of salespeople	74,000

Period costs for Winner's Sporting Equipment totaled:

A. $91,000.

B. $37,000.

C. $188,000.

D. $111,000.

Question- 9

The IMA issues which of the following certifications?

A. CMA

B. CIA

C. CFP

D. CPA

Question- 10

Indirect materials, indirect labor, and indirect manufacturing costs are what type of manufacturing cost?

A. Direct labor

B. Direct materials

C. Manufacturing overhead

D. Prime costs

Question- 11

A wave of accounting scandals around the turn of the 21st century prompted which of the following?

A. XBRL

B. IFRS

C. SOX

D. ISO

Question- 12

Internal parties receive information about past performance from:

A. audit reports.

B. budget reports.

C. planning reports.

D. managerial accounting reports.

Question- 13

Which of the following types of companies has raw materials, work in process, and finished goods inventory?

A. Retailers

B. Manufacturers

C. Wholesalers

D. Service companies

Question- 14

Refusing gifts or favors that could be perceived to influence your actions is an example of which ethical standard?

A. Credibility

B. Integrity

C. Confidentiality

D. Competence

Question- 15

The costs associated with reengineering machinery and its location within the factory to increase efficiency would be considered which part of the value chain?

A. Customer service

B. Marketing

C. Research and development

D. Design

Question- 16

Costs that remain the same among alternatives are:

A. sunk costs.

B. irrelevant costs.

C. controllable costs.

D. uncontrollable costs.

Question- 17

The person who is directly responsible for all financial functions is the:

A. Treasurer.

B. CEO.

C. CFO.

D. COO.

Question- 18

________ is the business philosophy and a strategy of manufacturing without waste.

A. ISO 9001

B. Lean thinking

C. TQM

D. Thin manufacturing

Question- 19

Communicating information fairly and objectively is an example of which ethical standard?

A. Credibility

B. Integrity

C. Competence

D. Confidentiality

Question- 20

Which of the following describes the way in which total fixed costs behave?

A. They will decrease as production increases.

B. They will decrease as production decreases.

C. They will remain the same throughout production levels within the relevant range.

D. They will increase as production decreases.

BU330 Accounting for Managers Set-2

Question-1

The cost of downtime caused by quality problems with the raw materials would be classified as what type of cost?

A. Prevention cost

B. Appraisal cost

C. External failure cost

D. Internal failure cost

Question-2

Which of the following is a result of cost distortion?

A. Over costing of all products

B. Under costing of all products

C. Accurate costing of all products

D. Over costing of some products and under costing of other products

Question-3

Which term listed below describes a system where companies purchase raw materials when needed in production and complete finished goods when needed by customers?

A. Internal failure costs

B. Backflush costing

C. Just-in-time

D. External failure costs

Question-4

Which of the following is a lean strategy?

A. Group like machines together.

B. Produce in smaller batches than a traditional system.

C. Maintain a higher level of inventory than a traditional system.

D. Lengthen setup times relative to a traditional system.

Question-5

The entry to record the purchase of raw materials on account using a job costing system would include a:

A. credit to work-in-process inventory.

B. debit to accounts payable.

C. debit to work-in-process inventory.

D. debit to raw materials inventory.

Question-6

Activity	Allocation Base	Cost Allocation Rate
Materials handling	Number of parts	$2.00 per part
Machining	Machine hours	$2.75 per machine hour
Assembling	Number of parts	$1.00 per part
Packaging	Number of finished units	$3.00 per finished unit

What is the cost of machining per coffee table?

A. $15

B. $21

C. $13.75

D. $55

Question-7

The predetermined indirect cost allocation rate is computed as:

A. total estimated indirect costs / total estimated amount of the allocation base.

B. total amount of the allocation base / total estimated indirect costs.

C. total estimated indirect costs + total estimated amount of the allocation base.

D. total amount of the allocation base - total estimated indirect costs

Question-8

Watson's Computer Company uses ABC to account for its manufacturing process.

Activities	Indirect activity budget	Allocation base (cost driver)
Materials handling	$52,000	Based on number of parts
Machine setup	30,000	Based on number of setups
Assembling	9,750	Based on number of parts
Packaging	15,300	Based on number of finished units

Watson's Computer Company expects to produce 2,250 computers. Watson's Computer Company also expects to use 13,000 parts and have 20 setups. The allocation rate for materials handling will be:

A. $4.

B. $6.80.

C. $23.11.

D. $7.01.

Question-9

In job costing, the journal entry to record the use of direct materials on jobs is to debit work-in-process inventory and credit:

A. raw materials inventory.

B. finished goods inventory.

C. manufacturing overhead.

D. wages payable.

Question-10

A. $13,860

B. $4,200

C. $2,460

D. $7,457

Question-11

A system that focuses on activities as the fundamental cost object and uses the costs for these activities to compile indirect costs of goods and services is:

A. appraisal costs.

B. value engineering.

C. activity-based costing.

D. prevention costs.

Question-12

If jobs have been under costed due to under allocation of manufacturing overhead, then cost of goods sold (COGS) is too low and which of the following corrections must be made?

A. Decrease COGS for the amount of the under allocation

B. Increase COGS for double the amount of the under allocation

C. Decrease COGS for double the amount of the under allocation

D. Increase COGS for the amount of the under allocation

Question-13

The first step in developing an ABC system is:

A. calculate an activity cost allocation rate for each activity.

B. allocate the costs to the cost object using the activity cost allocation rates.

C. select an allocation base for each activity.

D. identify the primary activities and estimate a total cost pool for each.

Question-14

Service firms develop a predetermined rate for some costs. This rate is called the:

A. labor rate.

B. direct cost rate.

C. indirect cost allocation rate.

D. hourly cost rate.

Question-15

Here are selected data for Sunny Sky Corporation.

Beginning raw materials inventory	$37,000	Beginning work-in-process inventory	$62,200
Beginning finished goods inventory	58,300	Cost of materials purchased	151,000
Cost of direct materials requisitioned	91,300	Direct labor incurred	135,000
Actual manufacturing overhead	160,000	Cost of goods manufactured	287,000
Cost of goods sold	265,000	Manufacturing overhead rate (% of direct labor)	125%

What is the ending work-in-process inventory balance?

A. $161,500

B. $170,250

C. $211,200

D. $229,950

Question-16

A. $28,250

B. $29,500

C. $30,750

D. $1,250

Question-17

Which term listed below describes costs incurred when the company fails to detect poor quality goods or services before delivery to the customer?

A. Internal failure costs

B. Value-added activity

C. External failure costs

D. Just-in-time production

Question-18

Which of these documents informs the storeroom to send specific materials to the factory floor?

A. Receiving report

B. Bill of materials

C. Purchase order

D. Materials requisition

Question-19

The benefits of using the ABC costing system are higher if the company:

A. has high indirect costs.

B. produces many different products that use differing amounts of resources.

C. has high indirect costs and produces many different products that use differing amounts of resources.

D. produces only one product.

Question-20

A(n) ________ is an estimated manufacturing overhead rate computed before the year begins.

A. cost allocation

B. cost driver

C. predetermined manufacturing overhead rate

D. actual manufacturing overhead rate

Question-21

The representation for fixed cost per unit of activity is:

A. vx divided by v.

B. vx divided by y.

C. y divided by x.

D. f divided by x.

Question-22

When units are moved from one processing department to the next, the cost associated with those units must also be moved from one WIP account to the next. What are these costs called?

A. Transported costs

B. Transmitted costs

C. Transferred costs

D. Conveyed costs

Question-23

Which of the following is unique to a process costing system?

A. Work is not started on a product until an order is received.

B. Direct materials, direct labor, and manufacturing overhead are assigned to the first department only.

C. Costs for each process stay with that process until the goods are moved to finished goods.

D. Each process has its own WIP account.

Question-24

When absorption costing is used and management bonuses are related to operating income, managers are more likely to:

A. decrease inventory levels.

B. increase inventory levels.

C. keep inventory levels consistent.

D. steal from the company.

Question-25

The Jones Corporation uses a process system. During the current period, 2,500 units were started and 1,100 units were completed and transferred out. Ending units were 60% complete for materials and 45% complete for conversion costs. Direct materials costs added were $35,405 and conversion costs added were $32,870. There was no beginning WIP inventory and conversion costs are added evenly throughout the process. At the end of the period, what are the total equivalent units for conversion costs?

A. 1,940

B. 1,400

C. 1,100

D. 1,730

Question-26

The use of either absorption or variable costing will make little difference in companies:

A. using just-in-time inventory methods.

B. with large inventories.

C. with high fixed costs.

D. with high variable costs.

Question-27

Total fixed costs for Purple Figs Company are $52,000. Total costs, both fixed and variable, are $160,000 if 80,000 units are produced. The fixed cost per unit at 80,000 units would be:

A. $1.35/unit.

B. $0.65/unit.

C. $2.00/unit.

D. $2.65/unit.

Question-28

The contribution margin is equal to:

A. sales minus cost of goods sold.

B. sales minus operating expenses.

C. sales minus fixed expenses.

D. sales minus variable expenses.

Question-29

A company manufactures mirrors. Last month's costs were as follows.

Direct materials	$90,000
Direct labor	144,000
Manufacturing overhead	158,000

What were the conversion costs for the month?

A. $302,000

B. $392,000

C. $234,000

D. $90,000

Question-30

Which of the following does NOT appear on an income statement prepared using variable costing?

A. Fixed production costs

B. Contribution margin

C. Gross margin

D. Variable production costs

Question-31

In process costing, ________ is/are found by taking the number of partially completed physical units and multiplying it by the percentage of the process completed.

A. cost of goods sold

B. equivalent units

C. fixed manufacturing overhead costs

D. conversion costs

Question-32

Sugartown Corporation has total sales revenues of $930,000. If its total fixed costs are $182,000 and its total variable costs are $267,000, then the total contribution margin is:

A. total revenue minus total fixed costs.

B. total revenue minus total variable costs.

C. total variable costs minus total fixed costs.

D. equal to operating income.

Question-33

At Hodgson Corporation, direct materials are added at the beginning of the process, and conversion costs are uniformly applied. Other details include the following.

Beginning WIP direct materials	$32,000
Beginning WIP conversion costs	$20,250
Costs of materials added	$384,100
Costs of conversion added	$271,125
WIP beginning (50% for conversion)	19,200 units
Units started	119,500 units
Units completed and transferred out	115,700 units
WIP ending (60% for conversion)	23,000 units

What are the total equivalent units for conversion costs?

A. 127,200

B. 125,300

C. 129,500

D. 138,700

Question-34

Fixed costs that are the result of previous management decisions that current managers have no control over in the short run are called ________ fixed costs.

A. discretionary

B. committed

C. standard

D. past

Question-35

When predicting costs at other volumes using a cost equation derived from either the high-low method or regression analysis, managers should consider:

A. outliers.

B. general inflation.

C. seasonality.

D. All of the above

Question-36

The first step of the 5-step process costing procedure is.

A. compute output in terms of equivalent units.

B. summarize total costs to account for.

C. compute the cost per equivalent unit.

D. summarize the flow of physical units.

Question-37

The following information is provided by Adametz Company.

WIP inventory, January 1	0 units
Units started	7,500
Units completed and transferred out	3,300
WIP inventory, December 31	4,200
Direct materials	$15,500
Direct labor	$18,400
Manufacturing overhead	$9,000

The units in ending WIP inventory were 90% complete for materials and 50% complete for conversion costs. At the end of the year, what are the equivalent units for conversion costs?

A. 3,750

B. 3,300

C. 5,400

D. 2,100

Question-38

Fun Stuff Manufacturing produces Frisbees using a three-step process that includes molding, coloring, and finishing. Which of the following accounts is debited for conversion costs?

A. WIP inventory-finishing

B. Finished goods inventory

C. Raw materials inventory

D. Cost of goods sold

Question-39

Fun Stuff Manufacturing produces ping pong balls using a three-step sequential process that includes molding, coloring, and finishing. When the balls and associated costs are transferred from the coloring process to the finishing process, which account is credited?

A. WIP inventory-coloring

B. WIP inventory-molding

C. Raw materials inventory

D. WIP inventory-finishing

Question-40

On a traditional income statement, sales revenue less cost of goods sold equals:

A. gross profit.

B. contribution margin.

C. operating income.

D. operating expenses

BU330 Accounting for Managers Set-3

Question-1

In a special sales order decision, incremental fixed costs that will be incurred if the special order is accepted are considered to be:

A. opportunity costs.

B. irrelevant to the decision.

C. relevant to the decision.

D. sunk costs.

Question-2

Blue Technologies manufactures and sells DVD players. Great Products Company has offered Blue Technologies $22 per DVD player for 10,000 DVD players. Blue Technologies' normal selling price is $30 per DVD player. The total manufacturing cost per DVD player is $18 and consists of variable costs of $14 per DVD player and fixed overhead costs of $4 per DVD player. (NOTE: Assume excess capacity and no effect on regular sales.)

Question-3

The horizontal line intersecting the vertical y-axis at the level of total cost on a CVP graph represents:

A. total costs.

B. total variable costs.

C. total fixed costs.

D. breakeven point.

Question-4

A product is sold at $60.00 per unit, the variable expense per unit is $30, and total fixed expenses are $200,000, what are the breakeven sales in dollars?

A. $3,333

B. $100,000

C. $133,333

D. $400,000

Question-5

To find the number of units that need to be sold in order to breakeven or generate a target profit, the formula used is:

A. (fixed expenses + operating income) ÷ contribution margin per unit.

B. (fixed expenses + operating income) ÷ contribution margin ratio.

C. (fixed expenses - operating income) ÷ contribution margin ratio.

D. (fixed expenses - operating income) ÷ contribution margin per unit.

Question-6

Sky High Seats manufactures seats for airplanes. The company has the capacity to produce 100,000 seats per year, but is currently producing and selling 75,000 seats per year. The following information relates to current production:

Sale price per unit	$400

Variable costs per unit:	$220
Manufacturing	$50
Marketing and administrative

Total fixed costs:
Manufacturing	$750,000
Marketing and administrative	$200,000

If a special sales order is accepted for 3,000 seats at a price of $300 per unit, and fixed costs increase by $10,000, how would operating income be affected? (NOTE: Assume regular sales are not affected by the special order.)

A. Decrease by $80,000

B. Increase by $230,000

C. Increase by $90,000

D. Increase by $80,000

Question-7

Samson Incorporated provided the following information regarding its only product:

Sale price per unit	$50.00
Direct materials used	$160,000
Direct labor incurred	$185,000
Variable manufacturing overhead	$120,000
Variable selling and administrative expenses	$70,000
Fixed manufacturing overhead	$65,000
Fixed selling and administrative expenses	$12,000
Units produced and sold	20,000

Assume no beginning inventory

Assuming there is excess capacity, what would be the effect on operating income of accepting a special order for 1,200 units at a sale price of $47 per product? The 1,200 units would not require any variable selling and administrative expenses. (NOTE: Assume regular sales are not affected by the special order.)

A. Increase by $84,300

B. Decrease by $28,500

C. Increase by $24,300

D. Increase by $28,500

Question-8

The area to the right of the breakeven point and between the total revenue line and the total expense line represents:

A. expected profits.

B. expected losses.

C. variable expenses.

D. fixed expenses.

Question-9

The Muffin House produces and sells a variety of muffins. The selling price per dozen is $15, variable costs are $9 per dozen, and total fixed costs are $4,200. How many dozen muffins must The Muffin House sell to breakeven?

A. 10,500

B. 700

C. 280

D. 175

Question-10

The breakeven point may be defined as the number of units a company must sell to do which of the following?

A. Generate a net loss

B. Generate a zero profit

C. Earn more net income than the previous accounting period

D. Generate a net income

Question-11

To find the breakeven point using the shortcut formulas, you use:

A. zero for the contribution margin per unit.

B. zero for the fixed expenses.

C. zero for the contribution margin ratio.

D. zero for the operating income.

Question-12

Assume the following amounts:

Total fixed costs	$24,000
Selling price per unit	$20
Variable costs per unit	$15

If sales revenue per unit increases to $22 and 12,000 units are sold, what is the operating income?

A. $264,000

B. $60,000

C. $108,000

D. $84,000

Question-13

Pluto Incorporated provided the following information regarding its single product:

Direct materials used	$240,000
Direct labor incurred	$420,000
Variable manufacturing overhead	$160,000
Fixed manufacturing overhead	$100,000
Variable selling and administrative expenses	$60,000
Fixed selling and administrative expenses	$20,000

The regular selling price for the product is $80. The annual quantity of units produced and sold is 40,000 units (the costs above relate to the 40,000 units production level). The company has excess capacity and regular sales will not be affected by this special order. There was no beginning inventory. What would be the effect on operating income of accepting a special order for 3,500 units at a sale price of $55 per product?

A. Increase by $115,500

B. Increase by $269,500

C. Decrease by $115,500

D. Decrease by $269,500

Question-14

A manager should always reject a special order if:

A. the special order price is less than the variable costs of the order.

B. there is available excess capacity.

C. the special order price is less than the regular sales price.

D. the special order will require variable nonmanufacturing expenses.

Question-15

Which of the following best describes a "sunk cost"?

A. Costs that were incurred in the past and cannot be changed

B. Benefits foregone by choosing a particular alternative course of action

C. A factor that restricts the production or sale of a product

D. Expected future data that differ among alternatives

Question-16

Corny and Sweet grows and sells sweet corn at its roadside produce stand. The selling price per dozen is $3.75, variable costs are $1.25 per dozen, and total fixed costs are $750.00. What are breakeven sales in dollars?

A. $563

B. $300

C. $375

D. $1,125

Question-17

If total fixed costs are $455,000, the contribution margin per unit is $25.00, and targeted operating income is $25,000, how many units must be sold to breakeven?

A. 11,375,000

B. 19,200

C. 18,200

D. 625,000

Question-18

"Contribution margin per unit" is best described by which of the following?

A. Sales price per unit minus fixed cost per unit

B. Sales price per unit minus variable cost unit

C. Sales price per unit minus fixed and variable costs per unit

D. Units sold time contribution margin ratio

Question-19

The effect of a plant closing on employee morale is an example of which of the following?

A. A qualitative factor

B. A quantitative factor

C. A sunk cost

D. A variable cost

Question-20

The performance evaluation of a profit center is typically based on its:

A. flexible budget variance.

B. static budget variance.

C. return on investment.

D. return on assets.

Question-21

Brockman Company is preparing its cash budget for the upcoming month. The budgeted beginning cash balance is expected to be $35,000. Budgeted cash disbursements are $123,000, while budgeted cash receipts are $130,000. Brockman Company wants to have an ending cash balance of $48,000. How much would Brockman Company need to borrow to achieve its desired ending cash balance?

A. $6,000

B. $90,000

C. $42,000

D. $55,000

Question-22

Green Company has budgeted sales of 23,000 units for June and 25,000 units for July. Green's policy is to maintain its finished goods inventory at 25% of the following month's sales. Accordingly, at the end of May, Green had 5,750 units on hand. How many units must it produce in June in order to support the sales goal and maintain its policy regarding finished goods inventory?

A. 6,250 units

B. 23,000 units

C. 23,500 units

D. 29,250 units

Question-23

The difference between actual and budgeted figures is known as:

A. fluctuations.

B. variances.

C. overages.

D. underages.

Question-24

All of the following are responsibility centers EXCEPT:

A. profit centers.

B. investment centers.

C. customer centers.

D. cost centers.

Question-25

The results of a customer survey about customer experiences with the company's services would be an example of measuring which perspective?

A. Financial

B. Customer

C. Internal business

D. Learning and growth

Question-26

Which of the following types of cash outlays has its own budget?

A. Capital expenditures

B. Dividends

C. Income taxes

D. All of the above

Question-27

The ________ budget is the only budget stated ONLY in units, not dollars.

A. production

B. sales

C. direct materials

D. manufacturing overhead

Question-28

In a(n) ________ center, managers are accountable for both revenues and costs.

A. cost

B. profit

C. equity

D. investment

Question-29

For the most recent year, Robin Company reports operating income of $650,000. Robin's sales margin is 10%, and capital turnover is 2.0. What is Robin's return on investment (ROI)?

A. 5%

B. 1%

C. 100%

D. 20%

Question-30

If a company must decrease its selling price while all of the company's expenses remain constant, what will happen to return on investment (ROI)?

A. ROI will decrease.

B. ROI will increase.

C. ROI will not be affected.

D. We cannot determine the effect from the information provided.

Question-31

Regarding the budgeting process, which of the following statements is true?

A. The budget should always be designed by top corporate management.

B. The budget should be approved by the company's external auditors.

C. The budget should be designed from the bottom up, with input from employees at all levels.

D. All of the listed statements are true regarding the budgeting process.

Question-32

Feeney Furniture prepared the following sales budget.

Month	Cash Sales	Credit Sales
March	$20,000	$10,000
April	$36,000	$16,000
May	$42,000	$40,000
June	$54,000	$48,000

Credit collections are 15% two months following the sale, 50% in the month following the sale, and 30% in the month of sale. The remaining 5% is expected to be uncollectible. What are the total cash collections in June?

A. $36,800

B. $90,800

C. $86,000

D. $96,600

Question-33

Assume Cucumber Company expects each division to earn an 8% target rate of return. Assume the Company's Pickle Division had the following results.

Sales $24,500,000
Operating income $1,250,000
Total assets $15,500,000

The Division's ROI is:

A. 8.1%.

B. 15.8%.

C. 5.1%.

D. 7.0%.

Question-34

Budget committees most often would include all of the following people EXCEPT:

A. CEO.

B. research and development manager.

C. shareholder.

D. marketing manager.

Question-35

A. ($10,000).

B. $10,000.

C. ($710,000).

D. $710,000.

Question-36

Kotrick Company has beginning inventory of 15,000 units and expected sales of 23,000 units. If the desired ending inventory is 18,000 units, how many units should be produced?

A. 20,000

B. 56,500

C. 10,000

D. 26,000

Question-37

Forty Winks Corporation manufactures nightstands. The production budget shows that Forty Winks Corporation plans to produce 1,200 nightstands in March and 1,050 nightstands in April. Each nightstand requires .50 direct labor hours in its production. Forty Winks Corporation has a direct labor rate of $12 per direct labor hour. What is the total combined direct labor cost that should be budgeted for March and April?

A. 6,300

B. 7,200

C. 27,000

D. 13,500

Question-38

Selected financial data for The Portland Porcelain Works Coffee Mug Division is as follows.

Sales	$2,300,000
Operating income	$414,000
Total assets	$718,750
Current liabilities	$180,000
Target rate of return	10%
Weighted average cost of capital	8%

What is The Portland Porcelain Works Coffee Mug Division capital turnover?

A. 5.6

B. 12.8

C. 3.2

D. 1.7

Question-39

Beginning inventory is $120,000 and ending inventory is 60% of beginning inventory. Compute cost of goods sold for the period if purchases are $400,000.

A. $72,000

B. $448,000

C. $520,000

D. $592,000

Question-40

How much are the expected increase (decrease) in revenues and expenses from the special sales order?

A. Expected increase in revenues $220,000; expected increase in expenses $140,000

B. Expected increase in revenues $220,000; expected increase in expenses $40,000

C. Expected increase in revenues $300,000; expected increase in expenses $140,000

D. Expected increase in revenues $220,000; expected increase in expenses $120,000

BU330 Online Exam 3_05 SCORE 100 PERCENT

Question 1 of 20

5.0 Points

When units are moved from one processing department to the next, the cost associated with those units must also be moved from one WIP account to the next. What are these costs called?

A. Transported costs

B. Transmitted costs

C. Transferred costs

D. Conveyed costs

Question 2 of 20

5.0 Points

Fixed costs that are the result of previous management decisions that current managers have no control over in the short run are called ________ fixed costs.

A. discretionary

B. committed

C. standard

D. past

Question 3 of 20

5.0 Points

On a traditional income statement, sales revenue less cost of goods sold equals:

A. gross profit.

B. contribution margin.

C. operating income.

D. operating expenses.

Question 4 of 20

5.0 Points

When predicting costs at other volumes using a cost equation derived from either the high-low method or regression analysis, managers should consider:

A. outliers.

B. general inflation.

C. seasonality.

D. All of the above

Question 5 of 20

5.0 Points

The contribution margin is equal to:

A. sales minus cost of goods sold.

B. sales minus operating expenses.

C. sales minus fixed expenses.

D. sales minus variable expenses.

Question 6 of 20

5.0 Points

The first step of the 5-step process costing procedure is.

A. compute output in terms of equivalent units.

B. summarize total costs to account for.

C. compute the cost per equivalent unit.

D. summarize the flow of physical units.

Question 7 of 20

5.0 Points

When absorption costing is used and management bonuses are related to operating income, managers are more likely to:

A. decrease inventory levels.

B. increase inventory levels.

C. keep inventory levels consistent.

D. steal from the company.

Question 8 of 20

5.0 Points

In process costing, ________ is/are found by taking the number of partially completed physical units and multiplying it by the percentage of the process completed.

A. cost of goods sold

B. equivalent units

C. fixed manufacturing overhead costs

D. conversion costs

Question 9 of 20

5.0 Points

A company manufactures mirrors. Last month's costs were as follows.

Direct materials $90,000

Direct labor 144,000

Manufacturing overhead 158,000

What were the conversion costs for the month?

A. $302,000

B. $392,000

C. $234,000

D. $90,000

Question 10 of 20

5.0 Points

The following information is provided by Adametz Company.

WIP inventory, January 1 0 units

Units started 7,500

Units completed and transferred out 3,300

WIP inventory, December 31 4,200

Direct materials $15,500

Direct labor $18,400

Manufacturing overhead $9,000

The units in ending WIP inventory were 90% complete for materials and 50% complete for conversion costs. At the end of the year, what are the equivalent units for conversion costs?

A. 3,750

B. 3,300

C. 5,400

D. 2,100

Question 11 of 20

5.0 Points

The representation for fixed cost per unit of activity is:

A. vx divided by v.

B. vx divided by y.

C. y divided by x.

D. f divided by x.

Question 12 of 20

5.0 Points

Fun Stuff Manufacturing produces Frisbees using a three-step process that includes molding, coloring, and finishing. Which of the following accounts is debited for conversion costs?

A. WIP inventory-finishing

B. Finished goods inventory

C. Raw materials inventory

D. Cost of goods sold

Question 13 of 20

5.0 Points

Total fixed costs for Purple Figs Company are $52,000. Total costs, both fixed and variable, are $160,000 if 80,000 units are produced. The fixed cost per unit at 80,000 units would be:

A. $1.35/unit.

B. $0.65/unit.

C. $2.00/unit.

D. $2.65/unit.

Question 14 of 20

5.0 Points

At Hodgson Corporation, direct materials are added at the beginning of the process, and conversion costs are uniformly applied. Other details include the following.

Beginning WIP direct materials $32,000

Beginning WIP conversion costs $20,250

Costs of materials added $384,100

Costs of conversion added $271,125

WIP beginning (50% for conversion) 19,200 units

Units started 119,500 units

Units completed and transferred out 115,700 units

WIP ending (60% for conversion) 23,000 units

What are the total equivalent units for conversion costs?

A. 127,200

B. 125,300

C. 129,500

D. 138,700

Question 15 of 20

5.0 Points

Sugartown Corporation has total sales revenues of $930,000. If its total fixed costs are $182,000 and its total variable costs are $267,000, then the total contribution margin is:

A. total revenue minus total fixed costs.

B. total revenue minus total variable costs.

C. total variable costs minus total fixed costs.

D. equal to operating income.

Question 16 of 20

5.0 Points

Which of the following is unique to a process costing system?

A. Work is not started on a product until an order is received.

B. Direct materials, direct labor, and manufacturing overhead are assigned to the first department only.

C. Costs for each process stay with that process until the goods are moved to finished goods.

D. Each process has its own WIP account.

Question 17 of 20

5.0 Points

A. WIP inventory-coloring

B. WIP inventory-molding

C. Raw materials inventory

D. WIP inventory-finishing

Question 18 of 20

5.0 Points

A. 1,940

B. 1,400

C. 1,100

D. 1,730

Question 19 of 20

5.0 Points

Which of the following does NOT appear on an income statement prepared using variable costing?

A. Fixed production costs

B. Contribution margin

C. Gross margin

D. Variable production costs

Question 20 of 20

5.0 Points

The use of either absorption or variable costing will make little difference in companies:

A. using just-in-time inventory methods.

B. with large inventories.

C. with high fixed costs.

D. with high variable costs.

BU330 Week 5 Threaded Discussion

Managers may build slack into their budgets so that their target numbers are easier to attain. Analyze what might be some drawbacks to building slack into the budgets?

(168 words)

BU330 Online Exam 5_08 SCORE 100 PERCENT

Question 1

The breakeven point may be defined as the number of units a company must sell to do which of the following?

A. Generate a net loss

B. Generate a zero profit

C. Earn more net income than the previous accounting period

D. Generate a net income

Question 2

"Contribution margin per unit" is best described by which of the following?

A. Sales price per unit minus fixed cost per unit

B. Sales price per unit minus variable cost unit

C. Sales price per unit minus fixed and variable costs per unit

D. Units sold time contribution margin ratio

Question 3 of 40

5.0 Points

Sale price per unit $400

Variable costs per unit: $220

Manufacturing $50

Marketing and administrative

Total fixed costs:

Manufacturing $750,000

Marketing and administrative $200,000

If a special sales order is accepted for 7,000 seats at a price of $350 per unit, and fixed costs remain unchanged, how would operating income be affected? (NOTE: Assume regular sales are not affected by the special order.)

A. Increase by $560,000

B. Decrease by $560,000

C. Increase by $2,450,000

D. Increase by $8,000,000

Question 4 of 40

5.0 Points

Pluto Incorporated provided the following information regarding its single product:

Direct materials used $240,000

Direct labor incurred $420,000

Variable manufacturing overhead $160,000

Fixed manufacturing overhead $100,000

Variable selling and administrative expenses $60,000

Fixed selling and administrative expenses $20,000

A. Increase by $115,500

B. Increase by $269,500

C. Decrease by $115,500

D. Decrease by $269,500

Question 5 of 40

5.0 Points

A. $563

B. $300

C. $375

D. $1,125

Question 6

To find the number of units that need to be sold in order to breakeven or generate a target profit, the formula used is:

A. (fixed expenses + operating income) ÷ contribution margin per unit.

B. (fixed expenses + operating income) ÷ contribution margin ratio.

C. (fixed expenses - operating income) ÷ contribution margin ratio.

D. (fixed expenses - operating income) ÷ contribution margin per unit.

Question 7

A manager should always reject a special order if:

A. the special order price is less than the variable costs of the order.

B. there is available excess capacity.

C. the special order price is less than the regular sales price.

D. the special order will require variable nonmanufacturing expenses.

Question 8

The horizontal line intersecting the vertical y-axis at the level of total cost on a CVP graph represents:

A. total costs.

B. total variable costs.

C. total fixed costs.

D. breakeven point.

Question 9

In a special sales order decision, incremental fixed costs that will be incurred if the special order is accepted are considered to be:

A. opportunity costs.

B. irrelevant to the decision.

C. relevant to the decision.

D. sunk costs.

Question 10

A product is sold at $60.00 per unit, the variable expense per unit is $30, and total fixed expenses are $200,000, what are the breakeven sales in dollars?

A. $3,333

B. $100,000

C. $133,333

D. $400,000

Question 11 of 40

5.0 Points

Samson Incorporated provided the following information regarding its only product:

Sale price per unit $50.00

Direct materials used $160,000

Direct labor incurred $185,000

Variable manufacturing overhead $120,000

Variable selling and administrative expenses $70,000

Fixed manufacturing overhead $65,000

Fixed selling and administrative expenses $12,000

Units produced and sold 20,000

Assume no beginning inventory

A. Increase by $84,300

B. Decrease by $28,500

C. Increase by $24,300

D. Increase by $28,500

Question 12

If total fixed costs are $455,000, the contribution margin per unit is $25.00, and targeted operating income is $25,000, how many units must be sold to breakeven?

A. 11,375,000

B. 19,200

C. 18,200

D. 625,000

Question 13

How much are the expected increase (decrease) in revenues and expenses from the special sales order?

A. Expected increase in revenues $220,000; expected increase in expenses $140,000

B. Expected increase in revenues $220,000; expected increase in expenses $40,000

C. Expected increase in revenues $300,000; expected increase in expenses $140,000

D. Expected increase in revenues $220,000; expected increase in expenses $120,000

Question 14 of 40

5.0 Points

Assume the following amounts:

Total fixed costs $24,000

Selling price per unit $20

Variable costs per unit $15

If sales revenue per unit increases to $22 and 12,000 units are sold, what is the operating income?

A. $264,000

B. $60,000

C. $108,000

D. $84,000

Question 15 of 40

5.0 Points

Sale price per unit $400

Variable costs per unit: $220

Manufacturing $50

Marketing and administrative

Total fixed costs:

Manufacturing $750,000

Marketing and administrative $200,000

A. Decrease by $80,000

B. Increase by $230,000

C. Increase by $90,000

D. Increase by $80,000

Question 16

The effect of a plant closing on employee morale is an example of which of the following?

A. A qualitative factor

B. A quantitative factor

C. A sunk cost

D. A variable cost

Question 17

The area to the right of the breakeven point and between the total revenue line and the total expense line represents:

A. expected profits.

B. expected losses.

C. variable expenses.

D. fixed expenses.

Question 18

A. 10,500

B. 700

C. 280

D. 175

Question 19

Which of the following best describes a "sunk cost"?

A. Costs that were incurred in the past and cannot be changed

B. Benefits foregone by choosing a particular alternative course of action

C. A factor that restricts the production or sale of a product

D. Expected future data that differ among alternatives

Question 20

To find the breakeven point using the shortcut formulas, you use:

A. zero for the contribution margin per unit.

B. zero for the fixed expenses.

C. zero for the contribution margin ratio.

D. zero for the operating income.

Question 21

The difference between actual and budgeted figures is known as:

A. fluctuations.

B. variances.

C. overages.

D. underages.

Question 22

Assume Cucumber Company expects each division to earn an 8% target rate of return. Assume the Company's Pickle Division had the following results.

Sales $24,500,000

Operating income $1,250,000

Total assets $15,500,000

The Division's RI is:

A. ($10,000).

B. $10,000.

C. ($710,000).

D. $710,000.

Question 23

Assume Cucumber Company expects each division to earn an 8% target rate of return. Assume the Company's Pickle Division had the following results.

Sales $24,500,000

Operating income $1,250,000

Total assets $15,500,000

The Division's ROI is:

A. 8.1%.

B. 15.8%.

C. 5.1%.

D. 7.0%.

Question 24 of 40

5.0 Points

Feeney Furniture prepared the following sales budget.

Month Cash Sales Credit Sales

March $20,000 $10,000

April $36,000 $16,000

May $42,000 $40,000

June $54,000 $48,000

A. $36,800

B. $90,800

C. $86,000

D. $96,600

Question 25

Beginning inventory is $120,000 and ending inventory is 60% of beginning inventory. Compute cost of goods sold for the period if purchases are $400,000.

A. $72,000

B. $448,000

C. $520,000

D. $592,000

Question 26

Which of the following types of cash outlays has its own budget?

A. Capital expenditures

B. Dividends

C. Income taxes

D. All of the above

Question 27

The results of a customer survey about customer experiences with the company's services would be an example of measuring which perspective?

A. Financial

B. Customer

C. Internal business

D. Learning and growth

Question 28

The performance evaluation of a profit center is typically based on its:

A. flexible budget variance.

B. static budget variance.

C. return on investment.

D. return on assets.

Question 29

A. 6,250 units

B. 23,000 units

C. 23,500 units

D. 29,250 units

Question 30 of 40

5.0 Points

Selected financial data for The Portland Porcelain Works Coffee Mug Division is as follows.

Sales $2,300,000

Operating income $414,000

Total assets $718,750

Current liabilities $180,000

Target rate of return 10%

Weighted average cost of capital 8%

What is The Portland Porcelain Works Coffee Mug Division capital turnover?

A. 5.6

B. 12.8

C. 3.2

D. 1.7

Question 31

A. $6,000

B. $90,000

C. $42,000

D. $55,000

Question 32

Budget committees most often would include all of the following people EXCEPT:

A. CEO.

B. research and development manager.

C. shareholder.

D. marketing manager.

Question 33

Kotrick Company has beginning inventory of 15,000 units and expected sales of 23,000 units. If the desired ending inventory is 18,000 units, how many units should be produced?

A. 20,000

B. 56,500

C. 10,000

D. 26,000

Question 34

The ________ budget is the only budget stated ONLY in units, not dollars.

A. production

B. sales

C. direct materials

D. manufacturing overhead

Question 35

All of the following are responsibility centers EXCEPT:

A. profit centers.

B. investment centers.

C. customer centers.

D. cost centers.

Question 36

A. 6,300

B. 7,200

C. 27,000

D. 13,500

Question 37

In a(n) ________ center, managers are accountable for both revenues and costs.

A. cost

B. profit

C. equity

D. investment

Question 38

Regarding the budgeting process, which of the following statements is true?

A. The budget should always be designed by top corporate management.

B. The budget should be approved by the company's external auditors.

C. The budget should be designed from the bottom up, with input from employees at all levels.

D. All of the listed statements are true regarding the budgeting process.

Question 39

For the most recent year, Robin Company reports operating income of $650,000. Robin's sales margin is 10%, and capital turnover is 2.0. What is Robin's return on investment (ROI)?

A. 5%

B. 1%

C. 100%

D. 20%

Question 40

If a company must decrease its selling price while all of the company's expenses remain constant, what will happen to return on investment (ROI)?

A. ROI will decrease.

B. ROI will increase.

C. ROI will not be affected.

D. We cannot determine the effect from the information provided.

BU330 Week 6 Threaded Discussion

Select a product with which you are familiar. Describe what type of standards (direct material and direct labor) might be in effect for that product wherever it is produced. For each of these standards, discuss how those standards may become outdated. How frequently would you think the company would need to evaluate each of the standards?

(160 words)

BU330 Online Exam 7_10 SCORE 100 PERCENT

Question 1 of 40

5.0 Points

The following information describes a company's usage of direct labor in a recent period.

Actual direct labor hours used	34,000
Actual rate per hour	$17.00
Standard rate per hour	$16.75
Standard hours for units produced	33,500

How much is the direct labor rate variance?

A. $8,375 favorable

B. $8,500 favorable

C. $8,375 unfavorable

D. $8,500 unfavorable

Question 2

A company's purchasing department negotiates all of the purchasing contracts for raw materials. Which variance is most useful in assessing the performance of the purchasing department?

A. Materials quantity variance

B. Materials price variance

C. Labor rate variance

D. Labor efficiency variance

Question 3

How is the direct labor efficiency variance calculated?

A. The difference between the standard labor hours allowed and the actual labor hours used multiplied by the actual labor rate

B. The difference between the standard labor hours allowed and the actual labor hours used multiplied by the standard labor rate

C. The difference between the standard labor hours and the actual labor hours used

D. The difference between the standard labor rate and the actual labor rate

Question 4 of 40

5.0 Points

Active Lifestyle Beverages gathered the following information for Job #928.

	Standard Total Cost	Actual Total Cost
Direct labor:
Standard: 540 hours at $6.75/hr.	3,645
Actual: 500 hours at $6.50/hr.		3,250

What is the direct labor efficiency variance?

A. $260 favorable

B. $260 unfavorable

C. $270 favorable

D. $270 unfavorable

Question 5

A manager purchased better quality materials for a slightly higher cost than anticipated. However, as a result, there was less spoilage than normal. What is the effect on the price and quantity variances respectively?

A. Favorable, favorable

B. Favorable, unfavorable

C. Unfavorable, favorable

D. Unfavorable, unfavorable

Question 6

A(n) ________ is a carefully predetermined cost that is usually expressed on a per unit basis.

A. allocated cost

B. applied cost

C. standard cost

D. flexible cost

Question 7

A company produced 2,200 units of output during a production process that normally requires 2 hours of labor per unit of output. The standard labor rate is $16 per hour, but the company paid $15 per hour. Actual hours needed to complete the production process were 4,600. How much was the labor rate variance?

A. $4,400 favorable

B. $4,400 unfavorable

C. $4,600 favorable

D. $4,600 unfavorable

Question 8

Kahn Performance Nutrition produces a protein shake that contains whey protein as one of its ingredients. The whey protein (materials) standards for each batch of protein shake produced are 12 pounds of whey protein at a standard cost of $3 per pound. During July, Kahn Performance Nutrition purchased and used 54,000 pounds of whey protein at a total of $170,000 to make a total of 4,300 batches of protein shake. What is the materials quantity variance for whey protein in July?

A. $7,200 unfavorable

B. $7,200 favorable

C. $141,900 favorable

D. $141,900 unfavorable

Question 9 of 40

5.0 Points

Capital Manufacturing designs and manufactures bathtubs for home and commercial applications. Capital recorded the following data for its commercial bathtub production line during the month of March.

Standard DL hours per tub	3
Standard overhead rate per DL hour	$6.50
Standard overhead cost per unit	$19.50

Actual overhead costs	$22,750
Actual DL hours	3,250
Actual overhead cost per machine hour	$7.00

Actual tubs produced	1,100

What is the variable manufacturing overhead efficiency variance for March?

A. $1,625 unfavorable

B. $325 unfavorable

C. $1,625 favorable

D. $325 favorable

Question 10

A company uses a single raw material in its production process. The standard price for a unit of material is $2. During the month the company purchased and used 600 units of this material at a price of $2.25 per unit. The standard quantity required per finished product is 2 units, and during the month the company produced 310 finished units. How much was the material quantity variance?

A. $40 favorable

B. $40 unfavorable

C. $45 favorable

D. $45 unfavorable

Question 11

Which term below is best paired with "The difference between the actual overhead cost incurred and the flexible budget amount of overhead cost for actual number of output"?

A. Sales volume variance

B. Flexible budget

C. Overhead flexible budget variance

D. Benchmarking

Question 12

Which of the following formulas is used to compute variable overhead rate (or spending) variance?

A. Actual hours x (actual rate – standard rate)

B. Standard hours allowed x (actual rate – standard rate)

C. Actual rate x (actual hours – standard hours allowed)

D. Standard rate x (actual hours – standard hours allowed)

Question 13

Myles Company budgeted 10,500 pounds of direct materials costing $23.50 per pound to make 5,300 units of product. The company actually purchased 11,000 pounds of direct materials costing $25 per pound to make the 5,300 units. What is the direct materials price variance?

A. $16,500 favorable

B. $16,500 unfavorable

C. $15,750 unfavorable

D. $15,750 favorable

Question 14

All of the following are advantages of using standard costs EXCEPT:

A. managers can evaluate the efficiency of production workers.

B. differences between the static budget and the flexible budget can be broken down into price and quantity components.

C. consumer motivation for purchases can be analyzed.

D. standard costing allows companies to create flexible budgets.

Question 15

The two fixed overhead variances are the:

A. budget and volume variances.

B. rate and efficiency variances.

C. price and usage variances.

D. rate and volume variances.

Question 16

Which of the following is NOT an advantage of using standard costs and variances?

A. Use as a performance benchmark for evaluation of actual costs

B. Use as a basis for components of the master budget

C. Simplification of bookkeeping

D. Change in behavior of managers to obtain desired variances

Question 17

How is the variable manufacturing overhead efficiency variance calculated?

A. The difference between the actual overhead rate and the standard overhead rate multiplied by the standard overhead rate

B. The difference between the standard hours allowed and the actual hours used multiplied by the standard overhead rate

C. The difference between the standard hours allowed and the actual hours used

D. The difference between the standard hours allowed and the actual hours used multiplied by the actual overhead rate

Question 18

The entry to allocate manufacturing overhead costs to production involves which of the following?

A. Debit to work-in-process inventory for the actual cost of overhead

B. Credit to work-in-process inventory for the standard rate of overhead times the standard quantity of the allocation base allowed for actual output

C. Credit to work-in-process inventory for the actual cost of overhead

D. Debit to work-in-process inventory for the standard rate of overhead times the standard quantity of the allocation base allowed for actual output

Question 19 of 40

5.0 Points

Jackson Industries has collected the following data for one of its products.

Direct materials standard (6 pounds per unit @ $0.55/lb.)	$3.30 per finished good
Direct materials flexible budget variance-unfavorable	$12,000
Actual direct materials used	35,000 pounds
Actual finished goods produced	26,000 units

What is the total actual cost of the direct materials used?

A. $19,250

B. $73,800

C. $97,800

D. $85,800

Question 20

The direct labor price variance was unfavorable and much greater than anticipated. Who would be in the best position to explain why the unfavorable variance occurred?

A. Both the production and human resource supervisors

B. The production supervisor

C. The purchasing manager

D. Both the purchasing manager and production supervisor

Question 21 of 40

5.0 Points

The Warren Company is considering investing in two alternative projects.

	Project 1	Project 2
Investment	$400,000	$250,000
Useful life (years)	5	6
Estimated annual net cash inflows for useful life	$100,000	$45,000
Residual value	$25,000	$15,000
Depreciation method	Straight-line	Straight-line
Required rate of return	12%	8%

What is the accounting rate of return for Project 2?

A. 33.67%

B. 3%

C. 18%

D. 2.33%

Question 22

What is an attribute of the internal rate of return?

A. It is the interest rate that makes the NPV of the investment equal to zero.

B. It is the interest rate that makes the cost of the investment equal to the present value of the investment's net cash inflows.

C. It is used in the capital rationing process.

D. All of the above are attributes of the internal rate of return.

Question 23

Mantua Motors is evaluating a capital investment opportunity. This project would require an initial investment of $38,000 to purchase equipment. The equipment will have a residual value at the end of its life of $3,000. The useful life of the equipment is 5 years. The new project is expected to generate additional net cash inflows of $12,000 per year for each of the 5 years. Mantua Motors' required rate of return is 14%. The net present value of this project is closest to:

A. ($1,994).

B. $4,753.

C. $3,196.

D. $28,386.

Question 24

"Management's minimum desired rate of return on an investment" is best described by which of the following terms?

A. Payback return

B. Internal rate of return

C. Discount rate

D. Net present value

Question 25

Smith & Cramer Computer Repair is considering an investment in computer and network equipment costing $254,000. This equipment would allow them to offer new programming services to clients. The equipment will be depreciated on the straight-line basis over an 8-year period with an estimated residual value of $60,000. Using the accounting rate of return model, what is the minimum average annual operating income that must be generated from this investment in order to achieve an 11% accounting rate of return?

A. $6,600

B. $21,340

C. $31,750

D. $27,940

Question 26

Which of the following is NOT a factor when considering the time value of money?

A. The interest rate

B. The principal amount

C. The payback period

D. The number of periods

Question 27

Eagle Corporation is considering the purchase of a new machine. The machine costs $550,000 and will generate an annual net cash inflow of $100,000. What is the payback period?

A. 4 years and 6 months

B. 5 years

C. 5 years and 6 months

D. 6 years and 1 month

Question 28

A manager wants to know which investment decision will affect the bottom line of the financial statements according to Generally Accepted Accounting Principles. Which capital budgeting method would he choose?

A. Payback method

B. Accounting rate of return method

C. Net present value method

D. Profitability index

Question 29

The internal rate of return is:

A. the interest rate at which the net present value of the investment equals the cost of the investment.

B. the interest rate at which the net present value of the investment exceeds the company's desired rate of return.

C. equal to the accounting rate of return.

D. None of the above

Question 30

The term ________ is best described as "a stream of equal periodic payments."

A. "time value of money"

B. "capital budgeting"

C. "annuity"

D. "payback period"

Question 31

Hincapie Manufacturing is evaluating investing in a new metal stamping machine costing $30,924. Hincapie estimates that it will realize $12,000 in annual cash inflows for each year of the machine's 3-year useful life. The internal rate of return (IRR) for the machine is approximately:

A. 8%.

B. 10%.

C. 5%.

D. 6%.

Question 32

All else being equal, a company would choose to invest in a capital asset if which of the following is true?

A. If the payback period equals the amount invested

B. If the expected accounting rate of return is less than the required rate of return

C. If the expected accounting rate of return is greater than the required rate of return

D. If the average amount invested is equal to the net cash inflows

Question 33

Assuming an interest rate of 6%, the present value of $22,000 to be received 9 years from now would be closest to:

A. $16,434.

B. $13,024.

C. $37,162.

D. $35,068.

Question 34

Siesta Manufacturing has asked you to evaluate a capital investment project. The project will require an initial investment of $88,000. The life of the investment is 7 years with a residual value of $4,000. If the project produces net annual cash inflows of $16,000, what is the accounting rate of return?

A. 3.90%

B. 4.55%

C. 550%

D. 18.18%

Question 35

Which of the following capital decision methods uses accrual accounting, rather than net cash flows, as a basis for calculations?

A. Payback method

B. Internal rate of return

C. Net present value

D. Accounting rate of return

Question 36

Which of the following areas does NOT make significant use of time value of money concepts?

A. Capital investment analysis

B. Lending and borrowing

C. Personal finance planning

D. Marketing research

Question 37 of 40

5.0 Points

Mulheim Corporation is deciding whether to automate one phase of its production process. The equipment has a 6-year life and will cost $410,000. Projected net cash inflows from the equipment are as follows.

Year 1	$120,000
Year 2	$100,000
Year 3	$110,000
Year 4	$100,000
Year 5	$95,000
Year 6	$90,000

Mulheim Corporation's hurdle rate is 12%. Assume the residual value is zero.

What is the net present value of the equipment?

A. $(18,275)

B. $3,046

C. $20,000

D. $18,275

Question 38

Which of the following decision rules is a correct statement?

A. If the net present value is positive, do not invest in the capital asset.

B. If the internal rate of return is less than the required rate of return, invest in the asset.

C. Investments with longer payback periods are more desirable, all else being equal.

D. If the net present value is positive, invest in the capital asset.

Question 39

You win the lottery and must decide how to take the payout. Use an 8% discount rate. What is the present value of $15,000 a year received at the end of each of the next 6 years?

A. $9,450

B. $90,000

C. $74,893

D. $69,345

Question 40

The following are all methods of analyzing capital investments EXCEPT:

A. payback period.

B. regression analysis.

C. net present value (NPV).

D. accounting rate of return (ARR).

BU330 Online Exam 8 SCORE 100 PERCENT

Question 1 of 20

5.0 Points

There are several reasons an organization might pursue sustainable initiatives. "A legislative act requires retailers to take back old batteries and electronic devices for recycling or reuse." This situation is an example of which type of reason to implement sustainable initiatives?

A. Cost reduction

B. Regulatory compliance

C. Stakeholder influence

D. Competitive strategy

Question 2 of 20

5.0 Points

The study of percentage changes in comparative financial statements is an example of:

A. vertical analysis.

B. trend analysis.

C. benchmarking.

D. horizontal analysis.

Question 3 of 20

5.0 Points

A company reported the following amounts of net income:

Year 1	$120,960
Year 2	$151,200
Year 3	$187,488

Which of the following is the percentage change from Year 2 to Year 3?

A. 24.00%

B. 55.00%

C. 124.00%

D. 25.00%

Question 4 of 20

5.0 Points

Which type of analysis includes the computation of the percentage change in total assets between two balance sheet dates?

A. Profitability

B. Vertical

C. Horizontal

D. Capital

Question 5 of 20

5.0 Points

A company's inventory account increased $26,500 and its accounts payable account decreased $18,250 during the year. The accounts payable relates only to the acquisition of inventory. Sales were $789,500 and cost of goods sold was $532,700. What was the amount of payments to suppliers of inventory?

A. $550,950

B. $577,450

C. $540,950

D. $834,250

Question 6 of 20

5.0 Points

Which of the following items represents monetary information in an environmental management accounting system?

A. Kilowatt hours of electricity used

B. Cost of upgrading factory equipment to reduce emissions

C. Ratio of recycled trash to total trash

D. Cost of janitorial services in office

Question 7 of 20

5.0 Points

Environmental sustainability is the primary concern of which of the following types of organizations?

A. Large domestic corporations

B. Global service firms

C. Manufacturing firms

D. All organizations regardless of size, location, or sector

Question 8 of 20

5.0 Points

A company reported the following amounts of net income:

Year 1	$15,000
Year 2	$21,000
Year 3	$31,500

Which of the following is the percentage change from Year 2 to Year 3?

A. 40.00%

B. 50.00%

C. 110.00%

D. 150.00%

Question 7 of 20

5.0 Points

Environmental sustainability is the primary concern of which of the following types of organizations?

A. Large domestic corporations

B. Global service firms

C. Manufacturing firms

D. All organizations regardless of size, location, or sector

Question 9 of 20

5.0 Points

Which of the following items is most likely to be found on an environmental management accounting report?

A. CEO's salary

B. Public accounting firm's fee for doing financial accounting audit

C. Ratio of recycled trash to total trash

D. Regional sales revenue

Question 10 of 20

5.0 Points

The following information relates to Woolf Unlimited for the past two years.

Account	Current year	Prior year
Net sales (all credit)	$237,250	$180,000
Cost of goods sold	$115,000	$110,000
Gross profit	$122,250	$ 70,000
Income from operations	$ 32,000	$ 30,000
Interest expense	$ 2,000	$ 7,000
Net income	$ 24,000	$ 18,000
Cash	$ 22,000	$ 14,000
Accounts receivable, net	$ 25,000	$ 31,000
Inventory	$ 56,000	$ 44,000
Prepaid expenses	$ 2,000	$ 1,000
Total current assets	$105,000	$ 90,000
Total long-term assets	$150,000	$175,000
Total current liabilities	$ 60,000	$ 90,000
Total long-term liabilities	$ 22,000	$ 78,000
Common stock, no par, 2,500 shares, market value $96 per share	$ 40,000	$ 40,000
Retained earnings	$133,000	$ 57,000

What is the inventory turnover for the current year?

A. 2.30 times

B. 0.78 times

C. 13.00 times

D. 2.20 times

Question 11 of 20

5.0 Points

A company uses the indirect method to prepare the statement of cash flows. It presents the following amounts on its financial statements.

	End of this year	End of prior year
Accounts receivable	$105,000	$100,000
Cost of goods sold	550,000
Sales revenue	850,000
Accounts payable*	75,000	65,000
Inventory	85,000	106,000
Salary payable	15,000	11,000
Salary expense	50,000	42,000

*Relates solely to the acquisition of inventory.

What will appear in the operating activities section related to inventory?

A. The decrease of $21,000 will be subtracted from net income.

B. The decrease of $21,000 will be subtracted from cost of goods sold.

C. The decrease of $21,000 will be added to net income.

D. The decrease of $21,000 will be added to cost of goods sold.

Question 12 of 20

5.0 Points

The following data relate to Sorrentino Corporation for last year:

Operating income	$250,000
Net increase in all current assets except cash	$45,000
Net decrease in current liabilities	$30,000
Gain on sale of investments	$8,000
Cash dividends paid on common stock	$35,000
Depreciation expense	$10,000

What is the net cash provided by operating activities for last year on the statement of cash flows for Sorrentino Corporation?

A. $130,000

B. $142,000

C. $173,000

D. $177,000

Question 13 of 20

5.0 Points

A payment of interest on a loan would be considered a:

A. cash outflow from investing activities.

B. cash outflow from operating activities.

C. cash outflow from financing activities.

D. cash outflow from depreciation.

Question 14 of 20

5.0 Points

Alexander Industries, in Chicago, plans to take advantage of the winds blowing in from Lake Michigan. Alexander is developing a project to install a wind turbine that would generate electricity and reduce energy costs. The turbine would have an initial cost of $500,000 and would provide a net cost savings of $57,000 per year. The turbine will have a life of 25 years. What is the payback period, in years, for the wind turbine?

A. 8.77 years

B. 9.08 years

C. 25 years

D. 28.75 years

Question 15 of 20

5.0 Points

Computing cash generated from operating activities is:

A. the same for both the direct and indirect methods.

B. different in that the indirect method considers depreciation.

C. different in that the direct method considers depreciation.

D. none of the above.

Question 16 of 20

5.0 Points

Using a base year as 100% and expressing other years as a percentage of the base year is an example of:

A. trend analysis.

B. vertical analysis.

C. horizontal analysis.

D. benchmarking.

Question 17 of 20

5.0 Points

The following information relates to Woolf Unlimited for the past two years.

Account	Current year	Prior year
Net sales (all credit)	$237,250	$180,000
Cost of goods sold	$115,000	$110,000
Gross profit	$122,250	$ 70,000
Income from operations	$ 32,000	$ 30,000
Interest expense	$ 2,000	$ 7,000
Net income	$ 24,000	$ 18,000
Cash	$ 22,000	$ 14,000
Accounts receivable, net	$ 25,000	$ 31,000
Inventory	$ 56,000	$ 44,000
Prepaid expenses	$ 2,000	$ 1,000
Total current assets	$105,000	$ 90,000
Total long-term assets	$150,000	$175,000
Total current liabilities	$ 60,000	$ 90,000
Total long-term liabilities	$ 22,000	$ 78,000
Common stock, no par, 2,500 shares, market value $96 per share	$ 40,000	$ 40,000
Retained earnings	$133,000	$ 57,000

What is the acid-test ratio for the current year?

A. 0.52

B. 0.75

C. 0.78

D. 2.30

Question 18 of 20

5.0 Points

The Nichols Corporation data for the current year:

Account	Current year	Prior year
Current assets	$75,600	$60,000
A/R	$59,400	$44,000
Mdse. Inventory	$51,200	$40,000
Current liabilities	$71,500	$55,000
Long-term liabilities	$36,000	$30,000
Common stock (5,000 shares)	$47,460	$42,000
Retained earnings	$31,240	$17,000
Net sales revenue	$607,700	$515,000
COGS	$469,700	$385,000
Gross Profit	$138,000	$130,000
Selling/General expenses	$49,080	$52,000
Net income before taxes	$88,920	$78,000
Income tax expense	$20,520	$18,000
Net Income	$68,400	$60,000

What would a horizontal analysis report with respect to long-term liabilities?

A. Long-term liabilities increased by $6,000.

B. Long-term liabilities decreased by 5.92%.

C. Long-term liabilities increased by 6.21%.

D. Long-term liabilities decreased by $1,500.

Question 19 of 20

5.0 Points

Which of the following would appear on a statement of cash flows prepared using the direct method?

A. Cash payments for salaries would appear on the statement.

B. A loss of the sale of equipment would appear on the statement.

C. Amortization expenses would appear on the statement.

D. Depreciation expenses would appear on the statement.

Question 20 of 20

5.0 Points

A ________ is a measure of the total emissions of carbon dioxide and other greenhouse gases.

A. carbon footprint

B. waste footprint

C. carbon mark

D. water footprint

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BU330 Accounting for Manager

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