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ACCT 346 Final Exam Guide (New)

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Multiple Choice 5 Short 9

Question 1. Question : (TCO 4) Assumptions underlying costvolume-profit analysis include all of the following,

Question 2. Question : (TCO 6) A basic assumption of activitybased costing (ABC) is that:

Question 3. Question : (TCO 2) In a traditional job order cost system, the use of direct labor on jobs increases:


Question 4.

Question :

(TCO5) Cost drivers are:

Question 5. Question : (TCO 8) Wood Co. has considerable excess manufacturing capacity. A special job order's cost sheet includes the following applied manufacturing overhead costs: Fixed costs: 25,000 Variable costs: 36,000 The fixed costs include a normal $4,500 allocation for in-house design costs, although no in-house design will be done. Instead, the job will require the use of external designers costing $9,250. What is the total amount to be included in the calculation to determine the minimum acceptable price for the job?

Question 6. Question : (TCO 1) Who are the users of managerial accounting information? How does their use of accounting information differ from the users of financial accounting information?


Question 7.

Question :

(TCO 2) Wolf Co. estimates

that its employees will work 400,000 direct labor hours during the coming year. Total overhead costs are estimated to be $9,600,000 and direct labor costs are estimated to be $12,500,000. Direct Labor hours are actually 450,000.

If Wolf Co. allocates overhead based on direct labor HOURS, what is the predetermined overhead rate?

Question 1. Question : (TCO 3) The Mixing Department is the third department in the MZS Inc. factory. During January, there were 4,000 units of beginning inventory in the Mixing Department, and 80,000 units were transferred in from the prior process. There were 8,000 units in ending inventory. The transferred-in cost in the beginning inventory was $170,000 and there was $600,000 in transferred-in cost during the month.

What is the cost per equivalent unit for transferred-in cost?


Question 2. Question : (TCO 4) Assume that we are manufacturing a product and assume that the sales price per unit is $80, the variable cost is $20 per unit, and the fixed cost is $90,000; a) how many units would we need to sell to break even? b) How many units would we need to sell to earn a profit of $120,000? c) How many units do we need to sell to double that profit to $240,000? D) Why didn't the number of units double from Part B to Part C?

Question 3. Question : (TCO 5) Sivan Co. manufactures and sells one product. For the year, they started with no opening inventory; produced 100,000 units, but only sold 70,000 units. The selling price per each unit is $60.

The variable costs per unit were: Direct materials.........................7 Direct Labor .............................6 Variable manufacturing overhead ....5 Variable selling and administrative‌6


Fixed costs per year: Fixed manufacturing Overhead ................$700,000 Fixed Selling and Administrative expenses.. $300,000

(a) Prepare the Income Statement using Absorption Costing. (b) Prepare the Income Statement using Variable Costing.

Question 4. Question : (TCO 6) At Long Co., electricity cost starts with a minimum fixed cost, and after that, there is a perfectly variable expense. Using estimated machine hours:

Machine hours

Cost

50,000

$102,000

60,000

$122,000

What is the a) estimated variable cost per machine hour and what is the b) estimated TOTAL fixed cost?


Question 5. Question : (TCO 7) North Company produces a small part that it uses in the production of its Product "H". The company's unit product cost for the part, based on a production of 100,000 parts per year, is as follows: .................................................Per part ....................Total

parts to the North Company for only $21.25 per part.(it appears to the President of the company that he could save $2.75 per unit. 100 percent of the traceable or avoidable fixed manufacturing cost is supervisor salaries and other costs that can be ELIMINATED if the parts are purchased. The decision to buy the parts from the outside supplier would have no effect on the common fixed costs of the company, and the space being used to produce the parts would otherwise be idle. Ignore the impact of income taxes in your calculation. How much would profits increase or decrease as a result of purchasing the parts from the outside supplier rather than making them inside the company?

Question 6. Question : (TCO 9) Harry Corp buys equipment for $194,000 that will last for 9 years. The equipment will generate cash flows of $36,000 per year and will have no salvage value at the end of its life. Ignore taxes. Use 10% required rate of return.


(a) What is the Present Value (PV) of this investment (at 10%)?

(b) What is the NET Present Value (NPV) of this investment Should you buy the equipment if you need 10%?

(c) What is the Internal Rate of Return (IRR) of this investment? (d) What is the payback period?

Comments:

good!

Question 7. Question : (TCO 10) Tanya Corp sells its products on both credit and cash basis. Monthly sales are sold 20% for cash, 80% for credit. Credit sales are collected 65% in the month of sale and 35% the following month. Sales for the first quarter are BUDGETED as follows: January $300,000; February $200,000; March $300,000.

Compute cash collections budgeted for February. How much cash was collected in the month? ===============================================


ACCT 346 Managerial Accounting Course Project on Bravo Baking Company (Devry)

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ACCT 346 Week 1 Homework Assignment ACCT 346 Week 2 Homework Assignment ACCT 346 Week 3 Homework Assignment ACCT 346 Week 4 Homework Assignment ACCT 346 Week 5 Homework Assignment ACCT 346 Week 6 Homework Assignment ACCT 346 Week 7 Homework Assignment ACCT 346 Final Exam Guide (New) ACCT 346 Midterm Set 1 (New) ACCT 346 Midterm Set 2 (New) ACCT 346 Midterm Exam All 4 Sets All 7 Weeks Discussions Course Project on Bravo Baking Company - All 6 tabs completed Quiz - Week 3 - 2 Sets included


Midterm - Week 4 - 2 Sets included Quiz - Week 6 - 2 Sets included Final Exam - Week 8 ===============================================

ACCT 346 Managerial Accounting Entire Course (Devry)

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Course Project on Bravo Baking Company - All 6 tabs completed Quiz - Week 3 - 2 Sets included Midterm - Week 4 - 2 Sets included Quiz - Week 6 - 2 Sets included Final Exam - Week 8 All 7 Weeks Discussions ===============================================

ACCT 346 Midterm Exam All 4 Sets

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Details of All Questions Included in these midterms could be found on this link

ACCT 346 Midterm Set 1 (New)

ACCT 346 Midterm Set 2 (New)

ACCT 346 Week 4 Midterm 1

ACCT 346 Week 4 Midterm 2

===============================================

ACCT 346 Midterm Set 1 (New)

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Multiple Choice

10


Short 4

1. (TCO 1) Which of the following is NOT a difference between Financial Accounting and Managerial Accounting? (Points : 7) Financial Accounting is concerned with the past, while Managerial Accounting is concerned with the future. Managerial Accounting uses more non-monetary information than Financial Accounting.

Question 2.2. (TCO1) Josie’s Grill budgeted the following costs for a month in which 1,500 steak dinners will be produced and sold: materials, $4,080; hourly labor (variable), $5,200; rent (fixed), $1,700; depreciation, $800; and other fixed costs, $600. Each steak dinner sells for $14.00 each. How much is the budgeted variable cost per unit? (Points : 7)

Question 3.3. (TCO 1) Which of the following is NOT a period cost? (Points : 7)


Question 4.4. (TCO 1) On December 31, 2015, GLE Inc. has a balance in the Work-in-Process Inventory account of $62,000. On January 1, 2015, the balance was $55,000. Current manufacturing costs for the year are $292,000, and cost of goods sold is $284,000. How much is cost of goods manufactured? (Points : 7)

Question 5.5. (TCO 2) Paul Company applies manufacturing overhead based on direct labor cost. Information concerning manufacturing overhead and labor for August follows.

Estimated Overhead cost Direct labor hours Direct labor cost

$174,000 5,800 $90,155

Actual $171,000 5,900 $87,000

How much is the predetermined overhead rate? (Points : 7)

Question 6.6. (TCO 2) During 2015, Michael Company applied overhead using a job-order costing system at a rate of $15 per direct labor hours. Estimated direct labor hours for the year were 150,000, and


estimated overhead for the year was $2,250,000. Actual direct labor hours for 20x1 were 140,000, and actual overhead was $2,400,000. What is the amount of under- or over-applied overhead for the year? (Points : 7)

1. (TCO 1) Which of the following topics is the focus of managerial accounting? (Points : 7)

Question 2.2. (TCO 6) Smile Labs develops 35mm film using a fourstep process that moves progressively through four departments. The company specializes in overnight service and has the largest drug store chain as its primary customer. Currently, direct labor, direct materials, and overhead are accumulated by department. The cost accumulation system that best describes the system that Smile Labs is using is: (Points : 7)

Question 3.3. (TCO 3) Kerner Manufacturing uses a process cost system to manufacture laptop computers. The following information


summarizes operations relating to laptop computer model #KJK20 during the quarter ending March 31: Units Direct Labor Work-in-process inventory, January 1 $50,000

100

Started during the quarter

500

Completed during the quarter

400

Work-in-process inventory, March 31

200

Costs added during the quarter $720,000 Beginning work-in-process inventory was 50% complete for direct labor costs. Ending work-in-process inventory was 75% complete for direct labor costs. What is the equivalent unit of production using the weighted-average unit cost inventory valuation method? (Points : 7)

4. (TCO 2) Sweet Co. uses budgeted overhead rates to apply overhead to individual jobs. They use a system based on direct labor hours. Last year, the company made the following estimates for this year.


Direct labor costs

$48,000,000

Factory overhead costs

$6,400,000

Direct Labor Hours Machine Hours

80,000 110,000

(a) What is the budgeted overhead rate for the company?

(b) If Job #34567 had the following:

Material costs were $500,000; Direct labor costs were $450,000; Direct labor hours were 25,000; and Machine hours were 36,000, then what is the total cost of Job #34567? (Points : 30)

5. (TCO 3) Adnan Company uses process costing. At the beginning of the month, there were 8,000 units in process, 90% complete with respect to material and 80% complete with respect to conversion costs. 40,000 units were started during the month and 40,000 units were completed.


The units in ending Work-In-Process Inventory were 70% complete with respect to material and 10% complete with respect to conversion costs. How many equivalent units will be used in calculating the cost per unit for materials?(Points : 30)

6. (TCO 6) Handy Display Company manufactures display cases to be sold to retail stores. The cases come in three sizes: large, medium, and small. Currently, Handy Display Company uses a single plant-wide overhead rate to allocate its $3,357,800 of annual manufacturing overhead. Of this amount, $820,000 is associated with the Large Case line, $1,276,800 is associated with the Medium Case line, and $1,261,000 is associated with the Small Case line. Handy Display Company is currently running a total of 33,000 machine hours: 10,000 in the Large Case line, 13,300 in the Medium Case line, and 9,700 in the Small Case line. Handy Display Company uses machine hours as the cost driver for manufacturing overhead costs.

7. (TCO 2) Fred Co. incurred costs of $800,000 for direct materials (raw) purchased. Direct labor was $5,000 and factory overhead was $15,000 for March.

Inventories were as follows:


Raw materials beginning $2,000; raw materials ending $4,000;

Work-in-process beginning $210,000; work-in-process ending $190,000;

Finished goods beginning $13,000; finished goods ending $12,500;

What is the cost of goods manufactured? Please show your work. (Points : 30) ===============================================

ACCT 346 Midterm Set 2 (New)

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Multiple Choice

10

Short 4

Grade Details - All Questions Page: 1 2


Question 1. Question : (TCO 1) The goal of managerial accounting is to provide information that managers need for which of the below?

Question 2. Question : (TCO 1) Josie’s Grill budgeted the following costs for a month in which 1,600 steak dinners will be produced and sold: materials, $4,080; hourly labor (variable), $5,200; rent (fixed), $1,700; depreciation, $800; and other fixed costs, $600. Each steak dinner sells for $14.00 each. How much is the budgeted variable cost per unit?

Question 3. period cost?

Question :

(TCO 1) Which of the following is NOT a

Question 4. Question : (TCO 1) On December 31, 2015, GLE Inc. has a balance in the Work-in-Process Inventory account of $62,000.


At January 1, 2015, the balance was $47,000. Current manufacturing costs for the year are $292,000, and cost of goods sold is $284,000. How much is cost of goods manufactured?

Question 5. Question : (TCO 2) Paul Company applies manufacturing overhead based on direct labor cost. Information concerning manufacturing overhead and labor for August follows.

Estimated Overhead cost Direct labor hours Direct labor cost

$174,000 5,800 $87,000

Actual $171,000 5,900 $89,975

How much is the predetermined overhead rate?

Question 6. Question : (TCO 2) During 2015, Michael Company applied overhead using a job-order costing system at a rate of $15 per direct labor hours. Estimated direct labor hours for the year were 150,000, and estimated overhead for the year was $2,250,000. Actual direct labor hours for 20x1 were 140,000, and actual overhead was $2,400,000.


What is the amount of under- or over-applied overhead for the year?

Question 7. Question : (TCO 2) Manufacturers follow four steps to implement a manufacturing overhead allocation system. What is the first step?

Question 1. Question : (TCO 1) Which of the following topics is the focus of managerial accounting?

Question 2. Question : (TCO 6) Smile Labs develops 35mm film using a four-step process that moves progressively through four departments. The company specializes in overnight service and has the largest drug store chain as its primary customer. Currently, direct labor, direct materials, and overhead are accumulated by department. The cost accumulation system that best describes the system that Smile Labs is using is:

Question 3. Question : (TCO 3) Kerner Manufacturing uses a process cost system to manufacture laptop computers. The following


information summarizes operations relating to laptop computer model #KJK20 during the quarter ending March 31: Units Direct Labor Work-in-process inventory, January 1 $50,000

100

Started during the quarter

500

Completed during the quarter

400

Work-in-process inventory, March 31

200

Costs added during the quarter $720,000 Beginning work-in-process inventory was 50% complete for direct labor costs. Ending work-in-process inventory was 75% complete for direct labor costs. What is the equivalent unit of production using the weighted-average unit cost inventory valuation method?

Question 4. Question : (TCO 2) Sweet Co. uses budgeted overhead rates to apply overhead to individual jobs. They use a system based on direct labor hours. Last year, the company made the following estimates for this year.

Direct labor costs

$48,000,000

Factory overhead costs

$6,400,000

Direct Labor Hours

80,000


Machine Hours

110,000

(a) What is the budgeted overhead rate for the company?

(b) If Job #34567 had the following:

Material costs were $500,000; Direct labor costs were $450,000; Direct labor hours were 25,000; and Machine hours were 36,000, then what is the total cost of Job #34567?

Question 5. Question : (TCO 3) Adnan Company uses process costing. At the beginning of the month, there were 8,000 units in process, 90% complete with respect to material and 80% complete with respect to conversion costs. 40,000 units were started during the month and 40,000 units were completed. The units in ending Work-In-Process Inventory were 70% complete with respect to material and 10% complete with respect to conversion costs. How many equivalent units will be used in calculating the cost per unit for materials?


Question 6. Question : (TCO 6) Handy Display Company manufactures display cases to be sold to retail stores. The cases come in three sizes: large, medium, and small. Currently, Handy Display Company uses a single plant-wide overhead rate to allocate its $3,357,800 of annual manufacturing overhead. Of this amount, $900,000 is associated with the Large Case line, $1,404,480 is associated with the Medium Case line, and $1,350,000 is associated with the Small Case line. Handy Display Company is currently running a total of 39,600 machine hours: 12,000 in the Large Case line, 15,960 in the Medium Case line, and 12,000 in the Small Case line. Handy Display Company uses machine hours as the cost driver for manufacturing overhead costs.

Requirement: Calculate the departmental overhead rate for each of the three departments listed.

Question 7.

Question :

(TCO 2)

Fred Co. incurred costs of $700,000 for direct materials (raw) purchased. Direct labor was $5,000 and factory overhead was $20,000 for March.

Inventories were as follows: Raw materials beginning $6,000; raw materials ending $8,000;

Work-in-process beginning $230,000; work-in-process ending $210,000;


Finished goods beginning $16,000; finished goods ending $15,500;

What is the cost of goods manufactured? Please show your work. ===============================================

ACCT 346 Week 1 Homework Assignment

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1. Identify whether each of the items below is a Product Cost or Period Cost: 2. Identify whether each of the items below is a Direct Cost or Indirect Cost: 3. Identify whether each of the below is a Fixed Cost or Variable Cost: 4. Classify each as direct material, direct labor, indirect labor, indirect labor, other manufacturing overhead or period cost, and then answer the 5 questions below:

Factory insurance Company president's salary


Eggs, salt, water used for baking Depreciation expense on bake ovens Paper wrappers for bread Factory lease Advertising costs Factory supervisor salaries Sales commissions Flour used in baking bread

2. Identify whether each of the items below is a Direct Cost or Indirect Cost: (1/2 point each, total 5 points)

Factory insurance Baker's wages Eggs used for baking Depreciation expense on bake ovens Paper wrappers for bread Cleaning materials for bake ovens Utilities used in factory Factory supervisor salaries Lubricant for factory equipment


Flour used in baking bread

3. Identify whether each of the items below is a Fixed Cost or Variable Cost: (1/2 point each, total 5 points)

Shipping costs for bread Cost of fuel for delivery truck fleet Factory rent Factory insurance Maintenance on delivery trucks Sales commissions Wages paid to part-time (hourly) baker's assistant Oven depreciation Cost of fruit for cake topping Factory utilities

Question 4 General Instructions: For this baking operation, you'll need to first classify each expense below as direct material, direct labor, indirect material, indirect labor, other manufacturing overhead or period cost, and then answer the calculation questions in Parts 4b - 4e.


a. Depreciation expense on factory forklifts ...... b. Property tax on corporate marketing office .... c. Company president's salary .....,,...... d. Factory janitor wages ............... e. Accounting department salaries ..... f. Bakers’ health insurance .............. g. Assorted baking ingredients............ h. Depreciation expense on administrative office equipment...... i. Bakers’ wages ........... j. Factory utilities .......... k. Production supervisors’ salaries ..... l. Flour .......................... m. Factory equipment lubricants ............ ===============================================

ACCT 346 Week 1-7 All Discussion Questions (Devry)

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Week 1 DQ 1 Ethics and Ethical Behavior


Week 1 DQ 2 Managerial and Financial Accounting Week 2 DQ 1 Job Order Costing Week 2 DQ 2 Process Costing Week 3 DQ 1 Cost-Volume-Profit Analysis Week 3 DQ 2 Variable Costing and Full Costing Week 4 DQ 1 Activity Based Costing Week 4 DQ 2 Incremental Cost Analysis Week 5 DQ 1 Pricing Techniques Week 5 DQ 2 Capital Budgeting Techniques Week 6 DQ 1 Budgeting Week 6 DQ 2 Standard Costs and Variance Analysis Week 7 DQ 1 Responsibility Centers ===============================================

ACCT 346 Week 2 Homework Assignment

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1. Biltz Company uses a predetermined manufacturing overhead rate based on direct labor hours to allocate (apply or charge)


manufacturing overhead costs to jobs. During the year, the company actually incurred manufacturing overhead costs of $582,000 and 135,000 direct labor hours were worked. The company originally estimated that it would incur $525,000 of manufacturing overhead during the year and that 150,000 direct labor hours would be worked.

2. The following account balances at the beginning of January were selected from the general ledger of Ocean City Manufacturing Company:

Work-in-Process (WIP) inventory

$0

Raw materials inventory

$28,000

Finished goods inventory

$40,000

Additional data:

1) Actual manufacturing overhead for January amounted to $62,000. 2) Total direct labor cost for January was $63,000. 3) The predetermined manufacturing overhead rate is based on direct labor cost. The budget for the year called for $250,000 of direct labor cost and $350,000 of manufacturing overhead costs.


4) The only job unfinished on January 31 was Job No. 151, for which total direct labor charges were $5,200 (800 direct labor hours) and total direct material charges were $14,000. 5) Cost of direct materials placed in production during January totaled $123,000. There were no indirect material requisitions during January.

3. Vintage Fun reproduces old-fashioned style roller skates and skateboards. The annual production and sales of roller skates is 950 units, while 1,750 skateboards are produced and sold. The company has traditionally used direct labor hours to allocate its overhead to products. Roller skates require 2.5 direct labor hours per unit, while skateboards require 1.25 direct labor hours per unit. The total estimated overhead for the period is $114,300. The company is looking at the possibility of changing to an activity-based costing system for its products. If the company used an activity-based costing system, it would have the following three activity cost pools: ===============================================

ACCT 346 Week 3 Homework Assignment

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1. Beginning WIP inventory is 15,500 units, 75% complete for materials. During the month, 90,000 units were started; 87,000 were finished; and ending WIP was 18,500 units that were 50% complete for materials.

How many equivalent units should be used to allocate costs for materials? (Assume that the weighted average method is used, not FIFO.)

2. During a period, 38,200 units were completed and 4,200 units were in ending WIP inventory. Ending WIP was 75% complete for direct materials and 50% complete for conversion costs.

2a. What are the equivalent units for direct materials?

Completed Units

$38,200

$38,200

Ending Units $4200 (75% complete)

$3,150

All Units $42,400 Equivalent Units

Direct Materials

$41,350


2b. What are the equivalent units for conversion costs? ===============================================

ACCT 346 Week 3 Quiz (2 Sets) (Devry)

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ACCT 346 Week 3 Quiz (2 Sets) (Devry) ===============================================

ACCT 346 Week 4 Homework Assignment

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1.MountainAir Company has the following selected data for the past year:

Units sold during year 30,000 Units produced during year 45,000


Units in ending inventory

15,000

Variable manufacturing cost per unit $ 4.50 Fixed manufacturing overhead (in total)

$ 20,250

Selling price per unit $ 12.00 Variable selling and administrative expense per unit $ 1.00 Fixed selling and administrative expenses (in total) $ 4,000

There were no units in beginning inventory.

Required: a. Prepare an income statement for last year using absorption (full) costing.

b. Calculate the total value of the ending inventory using absorption (full) costing.

c. Prepare an income statement for last year using variable costing (i.e., contribution margin income statement).

d. Calculate the total value of the ending inventory using variable costing.


Answer: ===============================================

ACCT 346 Week 4 Midterm 1 (Devry)

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1. Question : (TCO 1) Managerial accounting stresses accounting concepts and procedures that are relevant to preparing reports for 2. Question : TCO 1) Which of the following statements regarding fixed costs is true? 3. Question : (TCO 1) You own a car and are trying to decide whether or not to trade it in and buy a new car. Which of the following costs is an opportunity cost in this situation? 4. Question : (TCO 1) Shula’s 347 Grill has budgeted the following costs for a month in which 1,600 steak dinners will be produced and sold: materials, $4,080; hourly labor (variable), $5,200; rent (fixed), $1,700; depreciation, $800; and other fixed costs, $600. Each steak dinner sells for $14.00 each. How much is the budgeted variable cost per unit?


5. Question : (TCO 1) Which of the following is an example of a manufacturing overhead cost? 6. Question : (TCO 1) Which of the following is a period cost? 7. Question : (TCO 1) If the balance in the Finished Goods Inventory account increased by $30,000 during the period and the cost of goods manufactured was $220,000, how much is cost of goods sold? 8. Question : (TCO 2) BCS Company applies manufacturing overhead based on direct labor cost. Information concerning manufacturing overhead and labor for August follows: Estimated Actual 9.Question : (TCO 2) During 2011, Madison Company applied overhead using a joborder costing system at a rate of $12 per direct labor hours. Estimated direct labor hours for the year were 150,000, and estimated overhead for the year was $1,800,000. Actual direct labor hours for 2011 were 140,000 and actual overhead was $1,670,000. What is the amount of under or over applied overhead for the year? 10. Question :


(TCO 3) Companies in which of the following industries would not be likely to use process costing? 11. Question : (TCO 3) The Blending Department began the period with 45,000 units. During the period the department received another 30,000 units from the prior department and completed 60,000 units during the period. The remaining units were 75% complete. How much are equivalent units in The Blending Department’s work in process inventory at the end of the period? 12. Question : (TCO 3) During March, the varnishing department incurred costs of $90,250 for direct labor. The beginning inventory was 3,500 units and 10,000 units were transferred to the varnishing department from the sanding department during June. The direct labor cost in the beginning inventory was $27,270. The ending inventory consisted of 2,000 units, which were 25% complete with respect to direct labor. What is the cost per equivalent unit for direct labor?

13. Question :

(TCO 4) Clearance Depot has total monthly costs of $8,000 when 2,500 units are produced and $12,400 when 5,000 units are produced. What is the estimated total monthly fixed cost?


1. Question :

(TCO 4) The margin of safety is the difference between

2. Question :

(TCO 4) Allen Company sells homework machines for $100 each. Variable costs per unit are $75 and total fixed costs are $62,000. Allen is considering the purchase of new equipment that would increase fixed costs to $84,000, but decrease the variable costs per unit to $60. At that level Allen Company expects to sell 3,000 units next year. What is Allen’s break-even point in units if it purchases the new equipment?

3.Question :


(TCO 4) Paula Corporation sells a single product at a price of $275 per unit. Variable cost per unit is $135 and fixed costs total $356,860. If sales are expected to be $825,000, what is Paula’s margin of safety?

4. Question :

(TCO 5) In variable costing, when does fixed manufacturing overhead become an expense?

5. Question :

(TCO 5) Variable costing income is a function of:

6. Question :

(TCO 5) Peak Manufacturing produces snow blowers. The selling price per snow blower is $100. Costs involved in production are:


Direct Material per unit

$20

Direct Labor per unit

12

Variable manufacturing overhead per unit

10

Fixed manufacturing overhead per year

$148,500

In addition, the company has fixed selling and administrative costs of $150,000 per year. During the year, Peak produces 45,000 snow blowers


and sells 30,000 snow blowers. How much is cost of goods sold using full costing?

7.Question :

(TCO 6) Costs may be allocated to

8. Question :

(TCO 5) An allocation base

9. Question :

(TCO 6) The building maintenance department for Jones Manufacturing Company budgets annual costs of $4,200,000 based on the expected operating level for the coming year. The costs are allocated to two


production departments. The following data relate to the potential allocation bases:

Production Dept. 1

Production Dept. 2

Square footage

15,000

45,000

Direct labor hours

25,000

50,000


If Jones assigns costs to departments based on square footage, how much total costs will be allocated to Production Department 1?

10. Question :

(TCO 7) A company is trying to decide whether to sell partially completed goods in their current state or incur additional costs to finish the goods and sell them as complete units. Which of the following is not relevant to the decision?

11. Question :

(TCO 7) BigByte Company has 12 obsolete computers that are carried in inventory at a cost of $13,200. If these computers are upgraded at a cost of $7,500, they could be sold for $15,300. Alternatively, the computers could be sold "as is" for $9,000. What is the net advantage or disadvantage of reworking the computers?

12. Question :


(TCO 7) Olde Store has 12,000 cans of crab meat just a week past the expiration date. Each can cost $0.31. The cans could be sold as is for $0.20 each, or relabeled and sold as gourmet cat food. The cost of relabeling the cans would be $0.04 per can and the cans would then sell for $0.29 per can. What should be done with the cans and why?

1. Question :

(TCO 3) Describe a process costing system, including the types of companies that commonly use this system. How can process costing information be used in incremental analysis?

2. Question :

(TCO 7) Each year, ACE Engines surveys 7,600 former and prospective customers regarding satisfaction and brand awareness. For the current year, the company is considering outsourcing the survey to RBG Associates, who have offered to conduct the survey and summarize results for $50,000. Robert Ace, the president of ACE Engines, believes that RBG will do a higher-quality job than his company has been doing, but is unwilling to spend more than $12,000 above current costs. The


head of bookkeeping for ACE has prepared the following summary of costs related to the survey in the prior year.

Prepare an incremental analysis in good form to determine the impact on profit of going outside versus conducting the survey as in the past. Will ACE accept the RBG offer? Why or why not?

3. Question :

(TCO 4) The following monthly data are available for RedEx, which produces only one product that it sells for $84 each. Its unit variable costs are $28 and its total fixed expenses are $64,960. Sales during April totaled 1,600 units. ===============================================

ACCT 346 Week 4 Midterm 2 (Devry)

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1.Question : (TCO 1) Which of the following is not a difference between financial accounting and managerial accounting? 2. Question : TCO 1) Which of the following statements regarding fixed costs is true? 3. Question : (TCO 1) You own a car and are trying to decide whether or not to trade it in and buy a new car. Which of the following costs is an opportunity cost in this situation? 4. Question : (TCO 1) Shula’s 347 Grill has budgeted the following costs for a month in which 1,600 steak dinners will be produced and sold: materials, $4,080; hourly labor (variable), $5,200; rent (fixed), $1,700; depreciation, $800; and other fixed costs, $600. Each steak dinner sells for $14.00 each. How much is the budgeted variable cost per unit? 5. Question : (TCO 1) Which of the following is an example of a manufacturing overhead cost? 6. Question : (TCO 1) Product costs 7. Question : (TCO 1) At December 31, 2010, WDT Inc. has a balance in the Work in Process Inventory account of $62,000. At January 1, 2010, the balance was $55,000. Current manufacturing costs for the year are $292,000, and


cost of goods sold is $284,000. How much is cost of goods manufactured? 8. Question : (TCO 2) BCS Company applies manufacturing overhead based on direct labor hours. Information concerning manufacturing overhead and labor for August follows: Estimated Actual 9. Question : (TCO 2) Citrus Company incurred manufacturing overhead costs of $300,000. Total overhead applied to jobs was $306,000. What was the amount of overapplied or underapplied overhead? 10. Question : (TCO 3) Companies in which of the following industries would notbe likely to use process costing? 11.Question : (TCO 3) The Blending Department began the period with 20,000 units. During the period the department received another 80,000 units from the prior department and at the end of the period 30,000 units remained, which were 40% complete. How much are equivalent units in The Blending Department’s work in process inventory at the end of the period? 12. Question : (TCO 3) Ranger Glass Company manufactures glass for French doors. At the start of May, 2,000 units were in-process. During May, 11,000


units were completed and 3,000 units were in process at the end of May. These in-process units were 90% complete with respect to material and 50% complete with respect to conversion costs. Other information is as follows:

Calculate the cost per equivalent unit for conversion costs. 13. Question : (TCO 4) Clearance Depot has total monthly costs of $8,000 when 2,500 units are produced and $12,400 when 5,000 units are produced. What is the estimated total monthly fixed cost?

1. Question : (TCO 4) Which of the following will have no effect on the break-even point in units? 2. Question : (TCO 4) Circle K Furniture has a contribution margin ratio of 16%. If fixed costs are $176,800, how many dollars of revenue must the company generate in order to reach the break-even point? 3. Question : (TCO 4) Randy Company produces a single product that is sold for $85 per unit. If variable costs per unit are $26 and fixed costs total $47,500, how many units must Randy sell in order to earn a profit of $100,000?


4. Question : (TCO 5) In full costing, when does fixed manufacturing overhead become an expense? 5. Question : (TCO 5) Variable costing income is a function of: 6. Question : (TCO 5) Peak Manufacturing produces snow blowers. The selling price per snow blower is $100. Costs involved in production are: 7. Question : (TCO 6) Which of the following is not a reason that companies allocate costs? 8. Question : (TCO 6) Which of the following statements about cost pools is not true? 9. Question : (TCO 6) The building maintenance department for Jones Manufacturing Company budgets annual costs of $4,200,000 based on the expected operating level for the coming year. The costs are allocated to two production departments. The following data relate to the potential allocation bases: Production Dept. 1 10. Question :


(TCO 7) A company is currently making a necessary component in house (the company is producing the component for its own use). The company has received an offer to buy the component from an outside supplier. A machine is being rented to make the component. If the company were to buy the component, the machine would no longer be rented. The rent on the machine, in relation to the decision to make or buy the component, is: 11. Question : (TCO 7) Ricket Company has 1,500 obsolete calculators that are carried in inventory at a cost of $13,200. If these calculators are upgraded at a cost of $9,500, they could be sold for $22,500. Alternatively, the calculators could be sold "as is" for $9,000. What is the net advantage or disadvantage of reworking the calculators? 12. Question : (TCO 7) YXZ Company’s market for the Model 55 has changed significantly, and YXZ has had to drop the price per unit from $275 to $135. There are some units in the work in process inventory that have costs of $160 per unit associated with them. YXZ could sell these units in their current state for $100 each. It will cost YXZ $10 per unit to complete these units so that they can be sold for $135 each.

When the incremental revenues and expenses are analyzed, what is the financial impact?

1. Question :


(TCO 3) What are transferred-in costs? Which departments will never have transferred-in costs?

2. Question : (TCO 7) Computer Boutique sells computer equipment and home office furniture. Currently, the furniture product line takes up approximately 50% of the company's retail floor space. The president of Computer Boutique is trying to decide whether the company should continue offering furniture or just concentrate on computer equipment. If furniture is dropped, salaries and other direct fixed costs can be avoided. In addition, sales of computer equipment can increase by 13%. Allocated fixed costs are assigned based on relative sales. Computer Home Office Equipment Furniture

3. Question : (TCO 4) The following monthly data are available for RedEx, which produces only one product that it sells for $84 each. Its unit variable costs are $28 and its total fixed expenses are $64,960. Sales during April totaled 1,600 units. ===============================================


ACCT 346 Week 5 Homework Assignment

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1. Palmer's Gourmet Chocolates produces and sells assorted boxed chocolates. The unit selling price is $50 per box, unit variable costs are $25 per box, and total fixed costs for the company are $2,000.

1a. How many boxes of chocolates must Palmer's Gourmet Chocolates sell to break even?

1b. What are breakeven sales in dollars?

2. Extreme Sports received a special order for 1,000 units of its extreme motorbike at a selling price of $250 per motorbike. Extreme Sports has enough extra capacity to accept the order. No additional selling costs will be incurred. Unit costs to make and sell this product are as follows: direct materials, $100; direct labor, $50; variable manufacturing overhead, $14; fixed manufacturing overhead, $10. 2a. List the relevant costs for the decision of whether or not to accept the special order.


2b. What will be the change (difference) in operating income if Extreme Sports accepts the special order? c. Should Extreme Sports accept the special order? Why or why not?

3. Totally Technology manufactures two product lines: Cameras and Video Recorders. The company's product line income statement follows: Management is considering discontinuing the Video Recorder product line. Accountants for the company estimate that discontinuing the Video Recorder line will decrease fixed cost of goods sold by $10,000 and fixed marketing and administrative expenses by $4,000. repare an analysis supporting your opinion about whether or not the Video Recorder product line should be discontinued. ===============================================

ACCT 346 Week 6 Homework Assignment

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1. Cave Hardware's forecasted sales for April, May, June, and July are $200,000, $230,000, $190,000, and $240,000, respectively. Sales are


65% cash and 35% credit, with all accounts receivable collected in the month following the sale. Cost of goods sold is 75% of sales and ending inventory is maintained at $60,000 plus 10% of the following month's cost of goods sold. All inventory purchases are paid 22% in the month of purchase and 78% in the following month. What are the total cash collections budgeted for June?

2. Madden Corporation manufactures T-shirts (its only product). The company’s standards for manufacturing T-shirts are as follows: 2a. What is the direct labor rate variance for the month? Is it favorable or unfavorable? 2b. What is the direct labor efficiency variance for the month? Is it favorable or unfavorable? ===============================================

ACCT 346 Week 6 Quiz (2 Sets) (Devry)

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ACCT 346 Week 6 Quiz (2 Sets) (Devry) ===============================================


ACCT 346 Week 7 Homework Assignment

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1.Gomez Corporation is considering two alternative investment proposals with the following data: a.

How long is the payback period for Proposal X?

b.

What is the accounting rate of return for Proposal Y?

2. You have been awarded a scholarship that will pay you $500 per semester at the end of each of the next 8 semesters that you earn a GPA of 3.5 or better. You are a very serious student and you anticipate receiving the scholarship every semester. Using a discount rate of 3% per semester, which of the following is the correct calculation for determining the present value of the scholarship? PLEASE STATE WHY YOU CHOSE THE ANSWER THAT YOU DID.


3. Maersk Metal Stamping is analyzing a special investment project. The project will require the purchase of two machines for $30,000 and $8,000 (both machines are required). The total residual value at the end of the project is $1,500. The project will generate cash inflows of $11,000 per year over its 8-year life. If Maersk requires a 6% return, what is the net present value (NPV) of this project? (Use present value tables or Excel.)

4. Hincapie Manufacturing is evaluating an investment 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 3year useful life. Approximately, what is the internal rate of return (IRR) for the investment? (Use present value tables or Excel.) ===============================================

ACCT 346 Week 8 Final Exam (Devry)

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Question : (TCO 1) The principle managers follow when they only investigate significant departures from the plan is commonly known as


Points Received: 4 of 4 2.Question : (TCO 1) Which of the following is not likely to be a fixed cost? Points Received: 4 of 4 3.Question : (TCO 2) Which of the following is not a manufacturing cost? Points Received: 4 of 4 4.Question : (TCO 2) An allocation base is Points Received: 4 of 4 5.Question : (TCO 3) Equivalent units are calculated by Points Received: 4 of 4 6.Question : (TCO 3) In the assembly department, all the direct materials are added at the beginning of the processing. Beginning Work in Process inventory


consists of 2,000 units with a direct materials cost of $31,860. During the period, 15,000 units are started and direct materials costing $250,000 are charged to the department. If there are 1,000 units in ending inventory, what is the cost per equivalent unit? Points Received: 4 of 4 7.Question : (TCO 4) Regression analysis Points Received: 4 of 4 8.Question : (TCO 4) The number of units that must be sold to exactly cover its fixed and variable costs is the Points Received: 4 of 4 9.Question : (TCO 5) Which of the following is treated as a product cost in variable costing? Points Received: 4 of 4 10.Question : (TCO 5) If the number of units sold is less than the number of units produced


Points Received: 4 of 4 11.Question : (TCO 6) A contract which specifies that the suppler will be paid for the cost of production as well as some fixed amount or percentage of cost is called a(n) Points Received: 4 of 4 12.Question : (TCO 6) Which of the following is not generally true when a company compares ABC and traditional costing? Points Received: 4 of 4 13.Question : (TCO 7) Fixed costs that will be eliminated if a particular course of action is undertaken are called Points Received: 4 of 4 Page: 1.Question : (TCO 7) Common costs Points Received:


4 of 4 2.Question : (TCO 8) Target costing Points Received: 4 of 4 3. Question : (TCO 8) Which of the following are relevant in deciding whether to accept or reject a special order? Points Received: 4 of 4 4.Question : (TCO 9) Present value techniques Points Received: 4 of 4 5.Question : (TCO 9) The internal rate of return Points Received: 4 of 4 6.Question :


(TCO 10) A method of budget preparation that requires all budgeted amounts to be justified by the department, even if the amounts were supported in prior periods, is called Points Received: 4 of 4 7.Question : (TCO 10) Which budget is prepared first? Points Received: 4 of 4 8. Question : (TCO 10) The standard cost is Points Received: 4 of 4 9.Question : (TCO 10) In general, an unfavorable material variance arises from Points Received: 4 of 4 10.Question : (TCO 10) The type of center that has responsibility for generating revenue as well as controlling costs is a(n) Points Received:


4 of 4 11.Question : (TCO 10) Responsibility accounting holds managers responsible for Points Received: 4 of 4 12. Question : (TCO 10) Which ratio measures the rate earned on total capital provided by the owners? Points Received: 4 of 4 Page: 1.Question : (TCO 1) Distinguish managerial accounting from financial accounting. Include a brief discussion of the differences in the types of information provided to users as well as the differences of the users of the accounting information. Points Received: 20 of 20 2. Question :


(TCO 6) Booth Financial Services, LLC has two revenue producing departments, Financial Planning and Business Consulting. The accounting department is trying to determine the best method to allocate $1,000,000 of common costs (secretarial staff, reception personnel, etc), either by salary or number of employees. Information on the revenue departments are as follows: Department Employees Salaries Financial Planning 150 employees $10,000,000 Business Consulting 50 employees $5,000,000

(a) Allocate the $1,000,000 common costs to the two revenue departments using both methods. (b) Why are allocations called arbitrary? Points Received: 25 of 25 3.Question :


(TCO 10) Charlie Corp sells it products on both credit and cash basis. Monthly sales are sold 20% for cash, 80% for credit. Credit sales are collected 40% in the month of sale and 60% the following month. Sales for the first quarter are as follows:

January $100,000 February $150,000 March $125,000

Compute cash collections for February. Points Received: 25 of 25 4.Question : (TCO 2) Acme Fireworks uses a traditional overhead allocation based on direct labor hours. For the current year overhead is estimated at $1,000,000 and direct labor hours are budgeted at 200,000 hours. Actual hours worked were 195,000 and actual overhead was $978,000.

(a) Compute the predetermined manufacturing overhead rate. (b) Compute the applied manufacturing overhead.


(c) Compute the amount of over/under applied manufacturing overhead. Points Received: 25 of 25 Page: 1234 1.Question : (TCO 9) An investment of $185,575 is expected to generate returns of $65,000 per year for each of the next four years. What is the investment's internal rate of return? Points Received: 25 of 25 2.Question : (TCO 4) Legal Docs Inc is a legal services firm that files incorporation papers for small businesses. They charge $1,000 per application. This year's income statement shows the following:

Sales $1,295,000 Variable Expenses $1,023,000 Contribution margin $272,000 Fixed costs $250,000 Profit $22,000


Required: (a) Compute the break-even point in units. (b) Compute the contribution margin ratio. (c) Compute the current margin of safety. (d) How many applications must the company sell to make a profit of $350,000? Points Received: 25 of 25 3.Question : (TCO 5) The following data has been taken from Air-Tite company in its first year of business.

Units produced 100,000 Units sold 80,000 Units in ending inventory 20,000 Fixed manufacturing overhead $400,000


(a) Compute the amount of fixed manufacturing overhead that would be expensed in the current year if full absorption costing is used. (b) Compute the amount of fixed manufacturing overhead that would be expensed in the current year if variable costing is used. (c) Compute the amount of fixed manufacturing overhead that would be included in ending inventory under full absorption costing. Points Received: 25 of 25 ===============================================

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