NOVA southeastern ACCt5140 final exam 100% score

Attempt Score	30 out of 30 points
100%

QUESTION 1

1. When management directs attention only to those activities not proceeding according to plan, they are engaging in:

		Activity-based management
		Organization-based management
		Management by exception
		Just-in-time management

1.

1 points

QUESTION 2

1. Over the short term, which type of costs is indifferent to activity level changes?

		Variable costs
		Fixed costs
		Mixed costs
		Step costs

1 points

QUESTION 3

1. A unit contribution margin measures:

		The difference between price and variable cost per unit
		The difference between sales and cost of goods sold on a unit basis
		The difference between unit sales and total costs per unit
		The percentage difference between sales and cost of goods sold

1 points

QUESTION 4

1. Which of the following statements about budgeted financial statements is not true?

		Budgeted financial statements need to adhere to the same format as the audited financial statements.
		Development of budgeted financial statements is facilitated by spreadsheet programs.
		Budgeted financial statements reflect the results of operations assuming all budgeted predictions are correct.
		Budgeted financial statements are hypothetical.

1 points

QUESTION 5

1. Which of the following statements concerning the cash budget is true?

		The cash budget summarizes all economic activities during the budget period.
		The cash budget summarizes all cash receipts and disbursements during the budget period.
		The cash budget summarizes all sales and expenses during the budget period.
		The cash budget summarizes all revenues and expenses during the budget period.

1 points

QUESTION 6

1. Cari German uses gas to heat her home. She has accumulated the following information regarding her monthly gas bill and monthly heating degree-days. The heating degree-days value for a month is found by first subtracting the average temperature for each day from 65 degrees and then summing these daily amounts together for the month.

Month	Heating Degree-Days	Gas Bill
February	1,900	$254
April	600	$101

2. What will be the increase in Cari's monthly gas bill per heating degree-day using the high-low method?

		$0.3309
		$0.1177
		$46.00
		$153.00

1 points

QUESTION 7

1. The Apollo Delivery Service has the following information about its truck fleet miles and operating costs:

Year	Miles	Operating Costs
2011	250,000	$160,000
2012	300,000	$175,000
2013	350,000	$210,000

2.
What is the best estimate of fixed costs for fleet operating expenses in 2014 using the high-low method?

		$100,000
		$ 35,000
		$175,000
		$ 50,000

1 points

QUESTION 8

1. The Fairmont Machine Shop wants to develop a cost estimating equation for its monthly cost of electricity. It has the following data:

Month	Cost of Electricity (Y)	Direct Labor-Hours (X)
January	$14,000	1,500
April	$15,000	1,700
July	$17,000	2,000
October	$14,500	1,600

2.
What would be the best equation using the high-low method?

		Y = $4,000 + $7X
		Y = $0 + $9X
		Y = $1,000 + $8X
		Y = $5,000 + $6X

1 points

QUESTION 9

1. Depreciation of a copy machine in the Human Resource Department would best be classified as what type of cost?

		Variable Cost
		Fixed cost
		Mixed cost
		Step cost

1 points

QUESTION 10

1. Really Fast Delivery Services has the collected the following information about operating expenditures for its delivery truck fleet for the past five years:

Year	Miles	Operating Costs
2009	110,000	$390,000
2010	140,000	$420,000
2011	100,000	$360,000
2012	130,000	$410,000
2013	170,000	$450,000

2. Using the high-low method, what is the cost estimate for variable costs for 2014?

		$1.29
		$2.00
		$1.60
		$1.50

1 points

QUESTION 11

1. Really Fast Delivery Services has the collected the following information about operating expenditures for its delivery truck fleet for the past five years:

Year	Miles	Operating Costs
2009	110,000	$390,000
2010	140,000	$420,000
2011	100,000	$360,000
2012	130,000	$410,000
2013	170,000	$450,000

2. Using the high-low method, what is the cost estimate for fixed costs for 2014?

		$200,000
		$140,000
		$210,000
		$230,700

1 points

QUESTION 12

1. Wesley's income statement is as follows:

Sales (10,000 units)	$150,000
Less variable costs	- 48,000
Contribution margin	$102,000
Less fixed costs	- 24,000
Net income	$ 78,000

2. What is the unit contribution margin?

		$12.00
		$ 7.20
		$ 4.80
		$10.20

1 points

QUESTION 13

1. Wesley's income statement is as follows:

Sales (10,000 units)	$150,000
Less variable costs	- 48,000
Contribution margin	$102,000
Less fixed costs	- 24,000
Net income	$ 78,000

2.
What is the contribution margin ratio?

		167 percent
		68 percent
		40 percent
		60 percent

1 points

QUESTION 14

1. Wesley's income statement is as follows:

Sales (10,000 units)	$150,000
Less variable costs	- 48,000
Contribution margin	$102,000
Less fixed costs	- 24,000
Net income	$ 78,000

2. If sales increase by 1,000 units, profits will:

		Increase by $12,000
		Increase by $10,200
		Increase by $4,800
		Increase by $8,000

1 points

QUESTION 15

1. Eva Company sells one product at a price of $25 per unit. Variable expenses are 40 percent of sales, and fixed expenses are $25,000. The sales dollars level required to break even are:

		$ 2,500
		$10,000
		$33,333
		$41,667

1 points

QUESTION 16

1. Determine the unit break-even point, assuming fixed costs are $60,000 per period, variable costs are $16.00 per unit, and the sales price is $25.00 per unit.

		5,000
		6,667
		15,000
		12,000

1 points

QUESTION 17

1. Buckbeak Corporation had the following income statement for 2014:

Sales	$50,000
Less variable costs	- 28,000
Contribution margin	$22,000
Less fixed costs	- 16,000
Net income	$ 6,000

2. Buckbeak's 2014 operating leverage is:

		0.333
		2.000
		3.667
		2.333

1 points

QUESTION 18

1. The Snape Corporation has the following data for 2014:

Selling price per unit	$10
Variable costs per unit	$6
Fixed costs	$20,000
Units sold	12,000

2. Snape's 2014 operating leverage is:

		0.50
		2.00
		4.00
		1.71

1 points

QUESTION 19

1. The following costs related to Summertime Company for a relevant range of up to 20,000 units annually:

Variable Costs:
Direct materials	$5.00
Direct labor	1.50
Manufacturing Overhead	2.50
Selling and administrative	3.00
Fixed Costs:
Manufacturing overhead	$20,000
Selling and Administrative	10,000

2. The selling price per unit of product is $15.00. At a sales volume of 15,000 units, what is the total profit for Summertime Company?

		$ 30,000
		$ 15,000
		$225,000
		$300,000

1 points

QUESTION 20

1. The following information is available for Bluewood Corporation for a sales volume of 500 stereo speakers for the past month:

	Total	Per Unit
Sales	$225,000	$450
Less: variable expenses	80,000	160
Contribution margin	$145,000	$290
Less: fixed expenses	$ 35,000
Net operating income	$110,000

2. What is the contribution margin ratio?

		12.0%
		30.0%
		40.0%
		64.4%

1 points

QUESTION 21

1. The following information is available for Bluewood Corporation for a sales volume of 500 stereo speakers for the past month:

	Total	Per Unit
Sales	$225,000	$450
Less: variable expenses	80,000	160
Contribution margin	$145,000	$290
Less: fixed expenses	$ 35,000
Net operating income	$110,000

2. If sales increase by $51,750, net income will increase by what amount?

		$ 6,000
		$ 8,000
		$20,000
		$33,350

1 points

QUESTION 22

1. The Chateau Company manufactures 4,000 telephones per year. The full manufacturing costs per telephone are as follows:

Direct materials	$ 4
Direct labor	16
Variable manufacturing overhead	12
Average fixed manufacturing overhead	12
Total	$44

2.
The Quick Assembly Company has offered to sell Chateau 4,000 telephones for $31 per unit. If Chateau accepts the offer, $20,000 of fixed overhead will be eliminated. Chateau should:

		Make the telephones; the savings is $4,000
		Buy the telephones; the savings is $35,000
		Buy the telephones; the savings is $24,000
		Make the telephones; the savings is $24,000

1 points

QUESTION 23

1. Black Cat Corporation manufactures a product with the following full unit costs at a volume of 4,000 units:

Direct materials	$200
Direct labor	80
Manufacturing overhead (30% variable)	150
Selling expenses (50% variable)	50
Administrative expenses (10% variable)	80
Total per unit	$560

2.
A company recently approached Black Cat's management with an offer to purchase 450 units for $550 each. Black Cat currently sells the product to dealers for $800 each. Black Cat's capacity is sufficient to produce the extra 450 units. No selling expenses would be incurred on the special order. If Black Cat's management accepts the offer, profits will:

		Decrease by $120,000
		Increase by $66,800
		Increase by $97,650
		Decrease by $24,000

1 points

QUESTION 24

1. Georgia Manufacturing Company produces products A, B, C, and D through a joint process. The joint costs amount to $250,000.

Product	UnitsProduced	Sales Value at Split-Off	Additional Costs of Processing	Sales ValueAfter Processing
A	1,500	$20,000	$5,000	$30,000
B	2,500	$60,000	$6,000	$70,000
C	2,000	$40,000	$8,000	$50,000
D	3,000	$80,000	$12,000	$90,000

2.
If A is processed further, profits of A will:

		Decrease by $45,000
		Increase by $10,000
		Increase by $25,000
		Increase by $5,000

1 points

QUESTION 25

1. Clary Corporation sells 2,000 units of product Y per day at $2.00 per unit. Clary has the option of processing the product further for additional costs of $1,000 per day to produce product Z, which sells for $2.90 per unit. If Clary processes product Y further to produce product Z, the company's net income will:

		Decrease by $800 per day
		Decrease by $1,000 per day
		Increase by $800 per day
		Increase by $1,800 per day

1 points

QUESTION 26

1. The Cornell Milling Company manufactures an intermediate product identified as W1. Variable manufacturing costs per unit of W1 are as follows:

Direct materials	$ 5
Direct labor	$15
Variable manufacturing overhead	$10

2.
Ithaca Tools has offered to sell Cornell Milling 10,000 units of W1 for $40 per unit. If Cornell Milling accepts the offer, $50,000 of fixed manufacturing overhead will be eliminated. Applying differential analysis to the situation, Cornell Milling should:

		Buy W1; the savings is $100,000
		Buy W1; the savings is $50,000
		Make W1; the savings is $100,000
		Make W1; the savings is $50,000

1 points

QUESTION 27

1. Curve Company has collected the following information:

Cost to buy one unit	$48
Production costs per unit:
Direct materials	$22
Direct labor	$16
Variable manufacturing overhead	$2
Total fixed manufacturing overhead	$190,000

2.
What level of production is needed for Curve to be indifferent between making or buying the part, assuming it can eliminate $150,000 of fixed costs?

		22,500 units
		16,250 units
		13,000 units
		18,750 units

1 points

QUESTION 28

1. In an effort to achieve short-run profit maximization, limited resources should first be allocated to the product with:

		The highest contribution margin per unit
		The highest contribution per unit of constraining factor
		The highest selling price per unit of constraining factor
		The lowest cost per unit of constraining factor

1 points

QUESTION 29

1. A balanced scorecard is:

		An evaluation process that focuses on productivity
		A performance measurement system that is strictly directed toward sales growth
		A performance measure that evaluates multiple categories related to organizational goals
		A series of checks and balances designed to be mutually cooperative with the financial statements

1 points

QUESTION 30

1. If the International Division of Latin American Products had an investment turnover of 2.7 and a return on sales of 0.24, the return on investment would be:

		26.7%
		52.8%
		64.8%
		384.0%