Acct 505 final exam guide (new) set 1

ACCT 505 Final Exam Guide (New) Set 1 Click Below Link To Purchase http://www.foxtutor.com/product/acct-505-finalexam-guide-(new)-set-1 Score 248/250

Multiple Choice 2 Short 2 Essay 7

Question 1 : (TCO E) Designing a new product is a(n)

2. Question : (TCO G) Given the following data, what would ROI be?

Sales $70,000 Net operating income $10,000 Contribution margin $20,000 Average operating assets $50,000 Stockholder's equity $25,000

1. Question : (TCO C) Longiotti Corporation produces and sells a single product. Data concerning that product appear below.

Selling price per unit $375.00 Variable expense per unit $144.00 Fixed expense per month $1,686,300 Required: Determine the monthly breakeven in units or dollar sales. Show your work!

2. Question : (TCO B) Maverick Corporation uses the weighted-average method in its process costing system. Data concerning the first processing department for the most recent month are listed below.

Work in process, beginning: Units in beginning work in process inventory 400

Materials costs $6,900 Conversion costs $2,500 Percent complete for materials 80% Percent complete for conversion 15% Units started into production during the month 6,000 Units transferred to the next department during the month 5,600 Materials costs added during the month $112,500 Conversion costs added during the month $210,300 1. Question : (TCO D) Topple Company produces a single product.

Operating data for the company and its absorption costing income statement for the last year are presented below.

Units in beginning inventory 2,000 Units produced 9,000 Units sold 10,000 Sales $100,000 Less cost of goods sold: Beginning inventory 12,000 Add cost of goods manufactured 54,000

Goods available for sale 66,000 Less ending inventory 6,000 Cost of goods sold 60,000 Gross margin 40,000 Less selling and admin. expenses 28,000 Net operating income $12,000

2. Question : (TCO I) (Ignore income taxes in this problem.) Bill Anders retires in 8 years.

He has $650,000 to invest and is considering a franchise for a fast-food outlet. He would have to purchase equipment costing $500,000 to equip the outlet and invest an additional $150,000 for inventories and other working capital needs. Other outlets in the fast-food chain have an annual net cash inflow of about $160,000. Mr. Anders would close the outlet in 8 years.

He estimates that the equipment could be sold at that time for about 10% of its

original cost. Mr. Anders' required rate of return is 16%.

Required: Part A: What is the investment's net present value when the discount rate is 16%?

Part B: Refer to your calculations. Is this an acceptable investment?

Why or why not?

3. Question : (TCO A) The following data (in thousands of dollars) have been taken from the accounting records of the Maroon Corporation for the just-completed year.

Sales 1,300 Raw materials inventory, beginning 25 Raw materials inventory, ending 30 Purchases of raw materials 250 Direct labor 350 Manufacturing overhead 500

Administrative expenses 300 Selling expenses 250 Work in process inventory, beginning 150 Work in process inventory, ending 100 Finished goods inventory, beginning 80 Finished goods inventory, ending 110 Use the above data to prepare (in thousands of dollars) a schedule of Cost of Goods Manufactured and a Schedule of Cost of Goods Sold for the year.

In addition, what is the impact on the financial statements if the ending finished goods inventory is overstated or understated?

4. Question : (TCO F) Walker Corporation is preparing its cash budget for November. The budgeted beginning cash balance is $43,000. Budgeted cash receipts total $117,000 and budgeted cash disbursements total $122,000. The desired ending cash balance is $55,000. The company can borrow up to $100,000 at

any time from a local bank, with interest not due until the following month.

Required: Prepare the company's cash budget for November in good form. Make sure to indicate what borrowing, if any, would be needed to attain the desired ending cash balance

5. Question : (TCO F) Bella Lugosi Holdings, Inc. (BLH), has collected the following operating information for its current month's activity. Using this information, prepare a flexible budget analysis to determine how well BLH performed in terms of cost control.

Static Budget Activity level (in units) 5,250 5,178 Variable costs: Indirect materials $24,182 $23,476 Utilities $22,356 $22,674

Fixed costs: Administration $63,450 $65,500 Rent $65,317 $63,904 6. Question : (TCO H) Lindon Company uses 7,500 units of Part Y each year as a component in the assembly of one of its products. The company is presently producing Part Y internally at a total cost of $119,000 as follows.

Direct materials $26,000 Direct labor 28,000 Variable manufacturing overhead 20,000 Fixed manufacturing overhead 45,000

Total costs $119,000 An outside supplier has offered to provide Part Y at a price of $12 per unit. If Lindon stops producing the part internally, one third of the fixed manufacturing overhead would be eliminated.

Required: Prepare a make-or-buy analysis showing the annual advantage or disadvantage of accepting the outside supplier's offer. Please state clearly whether the part should be made or bought and share your work.

7. Question : (TCO B) Sandler Corporation bases its predetermined overhead rate on the estimated machine hours for the upcoming year. Data for the upcoming year appear below.

Estimated machine hours 75,000 Estimated variable manufacturing overhead $4.50 per machine hour Estimated total fixed manufacturing

overhead $825,000 The actual machine hours for the year turned out to be 77,000.

Required: Compute the company's predetermined overhead rate.