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Question # 00000692
Subject: Business / Accounting
Due on: 09/10/2013
Posted On: 09/03/2013 04:40 PM
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Test II - Chapters 5 thru 7

1.

Data concerning Odum Corporation's single product appear below:

Picture

The break-even in monthly unit sales is closest to:

A) 1,413 units
B) 1,110 units
C) 622 units
D) 1,048 units



2.

A cement manufacturer has supplied the following data:

Picture

What is the company's unit contribution margin?

A) $2.00
B) $0.32
C) $4.30
D) $2.30



3.

Tanigawa Inc. has an operating leverage of 8.7. If the company's sales increase by 8%, its net operating income should increase by about:

A) 69.6%
B) 8.7%
C) 108.8%
D) 8.0%

4.

A company that makes organic fertilizer has supplied the following data:

Picture

The company's unit contribution margin is closest to:

A) $5.25
B) $4.05
C) $3.50
D) $2.35

5.

Weinreich Corporation produces and sells a single product. Data concerning that product appear below:

Picture

The company is currently selling 2,000 units per month. Fixed expenses are $131,000 per month. The marketing manager believes that an $18,000 increase in the monthly advertising budget would result in a 170 unit increase in monthly sales. What should be the overall effect on the company's monthly net operating income of this change?

A) Increase of $2,700
B) Increase of $15,300
C) Decrease of $18,000
D) Decrease of $2,700



6.

Guillet Inc. produces and sells a single product. The selling price of the product is $180.00 per unit and its variable cost is $46.80 per unit. The fixed expense is $618,048 per month.

The break-even in monthly unit sales is closest to:

A) 3,434 units
B) 4,640 units
C) 7,093 units
D) 13,206 units



7.

Danneman Corporation's fixed monthly expenses are $13,000 and its contribution margin ratio is 56%. Assuming that the fixed monthly expenses do not change, what is the best estimate of the company's net operating income in a month when sales are $41,000?

A) $9,960
B) $5,040
C) $22,960
D) $28,000



8.

Green Enterprises produces a single product. The following data were provided by the company for the most recent period:

Picture

For the period above, one would expect the net operating income under absorption costing to be:

A) higher than the net operating income under variable costing.
B) lower than the net operating income under variable costing.
C) the same as the net operating income under variable costing.
D) The relation between absorption costing net operating income and variable costing net operating income cannot be determined.



9.

Vanstee Corporation manufactures a variety of products. Variable costing net operating income last year was $60,000 and this year was $67,000. Last year, $37,000 in fixed manufacturing overhead costs were deferred in inventory under absorption costing. This year, $8,000 in fixed manufacturing overhead costs were released from inventory under absorption costing.

What was the absorption costing net operating income this year?

A) $38,000
B) $96,000
C) $75,000
D) $59,000



10.

Green Enterprises produces a single product. The following data were provided by the company for the most recent period:

Picture

Under absorption costing, the unit product cost is:

A) $20
B) $18
C) $15
D) $25



11.

Olds Inc., which produces a single product, has provided the following data for its most recent month of operations:

Picture

There were no beginning or ending inventories. The absorption costing unit product cost was:

A) $97
B) $130
C) $99
D) $207

12.

Tsuchiya Corporation manufactures a variety of products. Last year, the company's variable costing net operating income was $57,500. Fixed manufacturing overhead costs deferred in inventory under absorption costing amounted to $35,400. What was the absorption costing net operating income last year?

A) $22,100
B) $35,400
C) $57,500
D) $92,900



13.

Segment margin is sales minus:

A) variable expenses.
B) traceable fixed expenses.
C) variable expenses and common fixed expenses.
D) variable expenses and traceable fixed expenses.

14.

Favini Company, which has only one product, has provided the following data concerning its most recent month of operations:

Picture

What is the unit product cost for the month under absorption costing?

A) $91
B) $125
C) $118
D) $98



15.

Dykema Corporation uses activity-based costing to compute product margins. Overhead costs have already been allocated to the company's three activity cost pools-Processing, Supervising, and Other. The costs in those activity cost pools appear below:

Picture

Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data appear below:

Picture

Finally, sales and direct cost data are combined with Processing and Supervising costs to determine product margins.

Picture

The activity rate for the Processing activity cost pool under activity-based costing is closest to:

A) $15.00 per MH
B) $3.60 per MH
C) $0.46 per MH

16.

Drewniak Corporation has provided the following data from its activity-based costing system:

Picture

The company makes 430 units of product O37W a year, requiring a total of 690 machine-hours, 40 orders, and 10 inspection-hours per year. The product's direct materials cost is $35.72 per unit and its direct labor cost is $29.46 per unit.
According to the activity-based costing system, the average cost of product O37W is closest to:

A) $94.11 per unit
B) $89.72 per unit
C) $65.18 per unit
D) $92.49 per unit

17.

Roshannon Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing system allocates two overhead accounts-equipment expense and indirect labor-to three activity cost pools-Processing, Supervising, and Other-based on resource consumption. Data to perform these allocations appear below:

Picture

Picture

In the second stage, Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow:

Picture

Finally, sales and direct cost data are combined with Processing and Supervising costs to determine product margins.

Picture

The activity rate for the Processing activity cost pool under activity-based costing is closest to:

A) $5.33 per MH
B) $0.68 per MH
C) $0.52 per MH
D) $3.00 per MH






18.

Ballweg Corporation has an activity-based costing system with three activity cost pools-Machining, Order Filling, and Other. In the first stage allocations, costs in the two overhead accounts, equipment depreciation and supervisory expense, are allocated to the three activity cost pools based on resource consumption. Data used in the first stage allocations follow:

Picture

Picture

Machining costs are assigned to products using machine-hours (MHs) and Order Filling costs are assigned to products using the number of orders. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow:

Picture

Finally, the costs of Machining and Order Filling are combined with the following sales and direct cost data to determine product margins.

Picture

What is the product margin for Product T2 under activity-based costing?

A) $1,821
B) $871
C) $8,700
D) $16,200






19.

Roshannon Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing system allocates two overhead accounts-equipment expense and indirect labor-to three activity cost pools-Processing, Supervising, and Other-based on resource consumption. Data to perform these allocations appear below:

Picture

Picture

In the second stage, Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow:

Picture

Finally, sales and direct cost data are combined with Processing and Supervising costs to determine product margins.

Picture

What is the overhead cost assigned to Product P3 under activity-based costing?

A) $30,000
B) $5,916
C) $5,640
D) $11,556

20.

Matt Company uses activity-based costing. The company has two products: A and B. The annual production and sales of Product A is 8,000 units and of Product B is 6,000 units. There are three activity cost pools, with total cost and total activity as follows:

Picture

The activity-based costing cost per unit of Product A is closest to:

A) $2.40
B) $3.90
C) $10.59
D) $6.60

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Preview: data xxxx its xxxxxxxxxxxxxx costing system:  The xxxxxxx makes 430 xxxxx of xxxxxxx xxxx a xxxxx requiring a xxxxx of 690 xxxxxxxxxxxxxx 40 xxxxxxx xxx 10 xxxxxxxxxxxxxxxx per year xxx product's direct xxxxxxxxx cost xx xxx 72 xxx unit and xxx direct labor xxxx is xxx xx per xxxx According to xxx activity-based costing xxxxxxx the xxxxxxx xxxx of xxxxxxx O37W is xxxxxxx to:A) $94 11 xxx unit B) $89 xx xxx unit C) $65 xx per unit D) $92 xx per unit Points xxxxxxxx 0/5 xxxxxxxx xxxxxxxxxxxxx Roshannon xxxxxxxxxxx uses activity-based xxxxxxx to compute xxxxxxx margins xx xxx first xxxxxx the activity-based xxxxxxx system allocates xxx overhead xxxxxxxxxxxxxxxxxx xxxxxxx and xxxxxxxx labor-to three xxxxxxxx cost pools-Processing, xxxxxxxxxxxx and xxxxxxxxxxx xx resource xxxxxxxxxxx Data to xxxxxxx these allocations xxxxxx below:    In xxx xxxxxx stage, xxxxxxxxxx costs are xxxxxxxx to products xxxxx machine-hours xxxxx xxx Supervising xxxxx are assigned xx products using xxx number xx xxxxxxx The xxxxx in the xxxxx activity cost xxxx are xxx xxxxxxxx to xxxxxxxx Activity data xxx the company's xxx products xxxxxxxxxxxxxxxxxxx xxxxx and xxxxxx cost data xxx combined with xxxxxxxxxx and xxxxxxxxxxx xxxxx to xxxxxxxxx product margins xxxxxxxxx activity rate xxx the xxxxxxxxxx xxxxxxxx cost xxxx under activity-based xxxxxxx is closest xxxxxxxxx 33 xxx xxxxxxxxxx 68 xxx MH C) $0 52 xxx MH D) $3 00 xxx MH 18 xxxxxxx xxxxxxxxxxx has xx activity-based costing xxxxxx with three xxxxxxxx cost xxxxxxxxxxxxxxxx xxxxx Filling, xxx Other In xxx first stage xxxxxxxxxxxx costs xx xxx two xxxxxxxx accounts, equipment xxxxxxxxxxxx and supervisory xxxxxxxx are xxxxxxxxx xx the xxxxx activity cost xxxxx based on xxxxxxxx consumption xxxx xxxx in xxx first
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Preview: income xxxxxx be xxxxxxxxxx 9 Vanstee xxxxxxxxxxx manufactures a xxxxxxx of xxxxxxxx xxxxxxxx costing xxx operating income xxxx year was xxxxxxx and xxxx xxxx was xxxxxxx Last year, xxxxxxx in fixed xxxxxxxxxxxxx overhead xxxxx xxxx deferred xx inventory under xxxxxxxxxx costing This xxxxx $8,000 xx xxxxx manufacturing xxxxxxxx costs were xxxxxxxx from inventory xxxxx absorption xxxxxxx xxxxxx was xxx absorption costing xxx operating income xxxx year?A) $38,000B) $96,000C) $75,000D) $59,00010 xxxxx xxxxxxxxxxx produces x single product xxx following data xxxx provided xx xxx company xxx the most xxxxxx period:   Under absorption xxxxxxxx the xxxx xxxxxxx cost xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Olds Inc x which produces x single xxxxxxxx xxx provided xxx following data xxx its most xxxxxx month xx xxxxxxxxxxxxxxxxxxxx were xx beginning or xxxxxx inventories The xxxxxxxxxx costing xxxx xxxxxxx cost xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Tsuchiya Corporation xxxxxxxxxxxx a variety xx products xxxx xxxxx the xxxxxxxxx variable costing xxx operating income xxx $57,500 xxxxx xxxxxxxxxxxxx overhead xxxxx deferred in xxxxxxxxx under absorption xxxxxxx amounted xx xxxxxxx What xxx the absorption xxxxxxx net operating xxxxxx last xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx xxxxxxx margin xx sales minus:A) variable xxxxxxxx B) traceable fixed xxxxxxxx C) variable xxxxxxxx xxx common xxxxx expenses D) variable xxxxxxxx and traceable xxxxx expenses xx xxxxxx Company, xxxxx has only xxx product, has xxxxxxxx the xxxxxxxxx xxxx concerning xxx most recent xxxxx of operations:   What xx the xxxx xxxxxxx cost xxx the month xxxxx absorption costing?A) $91B) $125C) $118D) $9815 xxxxxx Corporation xxxx xxxxxxxxxxxxxx costing xx compute product xxxxxxx Overhead costs xxxx already xxxx xxxxxxxxx to xxx
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