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Question 1

5 out of 5 points
Product costs:

Answer Selected Answer:


Are expenditures necessary and integral to finished products

Correct Answer:
Are expenditures necessary and integral to finished products

Question 2
5 out of 5 points
Use the following information and the indirect method to calculate the net cash provided or used by operating activities: Cash paid for purchase of plant assets Decrease in interest payable Depreciation expense Gain on retirement of bonds Increase in accounts receivable Loss on sale of plant assets Net Income $15,000 2,000 30,000 32,000 40,000 5,000 76,000

Answer Selected Answer:


$37,000

Correct Answer:
$37,000

Question 3
0 out of 5 points
Actual fixed overhead for Kapok Company during March was $92,780. The flexible budget for fixed overhead this period is $89,000 based on a production level of 5,000 units. If the company actually produced 4,200 units what is the fixed overhead volume variance for March?

Answer Selected Answer:


$3,780 unfavorable

Correct Answer:
$14,240 unfavorable

Question 4
5 out of 5 points
A company's income statement showed the following: net income, $124,000; depreciation expense, $30,000; and gain on sale of plant assets, $14,000. An examination of the company's current assets and current liabilities showed the following changes as a result of operating activities: accounts receivable decreased $9,400; merchandise inventory increased $18,000; prepaid expenses decreased $6,200; accounts payable increased $3,400. Calculate the net cash provided or used by operating activities.

Answer Selected Answer:


$141,000

Correct Answer:

$141,000

Question 5
5 out of 5 points
Chance, Inc. sold 3,000 units of its product at a price of $72 per unit. Total variable cost per unit is $51, consisting of $32 in variable production cost and $19 in variable selling and administrative cost. Compute the manufacturing margin for the company under variable costing.

Answer Selected Answer:


$120,000

Correct Answer:
$120,000

Answer Feedback:

($72 - $32) x 3,000 units = $120,000

Question 6
5 out of 5 points
A company has fixed costs of $90,000. Its contribution margin ratio is 30% and the product sells for $75 per unit. What is the company's break-even point in dollar sales?

Answer Selected Answer:


$300,000

Correct Answer:
$300,000

Answer Feedback:

Break-even point in dollar sales = $90,000/0.30 = $300,000

Question 7
5 out of 5 points
A corporation issued 300 shares of its $5 par value common stock in payment of a $1,800 charge from its accountant for assistance in filing its charter with the state. The entry to record this transaction will include:

Answer Selected Answer:


A $300 credit to Contributed Capital in Excess of Par Value, Common Stock

Correct Answer:
A $300 credit to Contributed Capital in Excess of Par Value, Common Stock

Question 8
5 out of 5 points
The three major cost components of a manufactured product are:

Answer Selected Answer:


Direct materials, direct labor, and factory overhead

Correct Answer:
Direct materials, direct labor, and factory overhead

Question 9
0 out of 5 points

The amount by which the overhead applied to jobs during a period exceeds the overhead incurred during the period is known as:

Answer Selected Answer:


Underapplied overhead

Correct Answer:
Overapplied overhead

Question 10
0 out of 5 points
Which of the following journal entries correctly records the current month's activity where $125,000 of raw material was purchased for cash, and $75,000 of direct material and $30,000 of indirect materials were used in the production process? (A) Raw Materials Inventory Raw Materials Inventory Goods in Process Inventory Factory Overhead (B) Raw Materials Inventory Cash Goods in Process Inventory Factory Overhead Raw Materials Inventory (C) Raw Materials Inventory Cash Raw Materials Inventory Goods in Process Inventory Factory Overhead (D) Cash Raw Materials Inventory Goods in Process Inventory Factory Overhead Raw Materials Inventory (E) Raw Materials Inventory Cash Goods in Process Inventory Raw Materials Inventory 125,000 125,000 125,000 125,000 75,000 30,000 105,000 125,000 125,000 105,000 75,000 30,000 125,000 125,000 75,000 30,000 105,000 125,000 125,000 105,000 75,000 30,000 125,000

Answer Selected Answer:


(C) above

Correct Answer:
(B) above

Question 11
5 out of 5 points
Advanced Company reports the following information for the current year. All beginning inventory amounts equaled $0 this year. Units produced this year: 25,000 units Units sold this year: 15,000 units Direct Materials: $9 per unit DIrect Labor: $11 per hour Variable overhead: $75,000 in total Fixed overhead: $137,500 in total Given Advanced Company's data, compute cost per unit of finished goods under variable costing. Answer

Selected Answer:
$23.00

Correct Answer:
$23.00

Answer Feedback:

$9 DM + $11 DL + ($75,000/25,000) VOH = $23

Question 12
5 out of 5 points
When using the indirect method to calculate and report net cash provided or used by operating activities, which of the following is subtracted from net income?

Answer Selected Answer:


Decrease in income taxes payable

Correct Answer:
Decrease in income taxes payable

Question 13
5 out of 5 points
Six months ago, a company purchased an investment in stock for $65,000. This investment is considered available-for-sale. The current market value of the stock is $68,500. The company should record a:

Answer Selected Answer:


Credit to Unrealized Gain-Equity for $3,500

Correct Answer:
Credit to Unrealized Gain-Equity for $3,500

Question 14
5 out of 5 points
A company manufactures and sells a product for $120 per unit. The company's fixed costs are $68,760, and its variable costs are $90 per unit. The company's break-even point in units is:

Answer Selected Answer:


2,292

Correct Answer:
2,292

Answer Feedback:

Break-even point = $68,760/($120 - $90) = 2,292 units

Question 15
5 out of 5 points
Bradford Company budgeted 4,000 pounds of material costing $5.00 per pound to produce 2,000 units. The company actually used 4,500 pounds that cost $5.10 per pound to produce 2,000 units. What is the direct materials quantity variance?

Answer Selected Answer:


$2,500 unfavorable

Correct Answer:
$2,500 unfavorable

Question 16
5 out of 5 points
Montaigne Corp. has the following information about its standards and production activity in November: Actual total factory overhead incurred Standard factory overhead Variable overhead Fixed overhead ($12,000/6,000 estimated units to be produced) Actual units produced The volume variance is: $2 per unit 4,800 units $3.10 per unit produced $28,175

Answer Selected Answer:


$2,400U

Correct Answer:
$2,400U

Question 17
5 out of 5 points
A manufacturing company has a beginning finished goods inventory of $14,600, raw material purchases of $18,000, cost of goods manufactured of $32,500, and an ending finished goods inventory of $17,800. The cost of goods sold for this company is:

Answer Selected Answer:


$29,300

Correct Answer:
$29,300

Answer Feedback:

Beg FG + COGM - End FG = COGS $14,600 + $32,500 - $17,800 =- $29,300

Question 18
5 out of 5 points

Preferred stock is often issued:

Answer Selected Answer:


All of the above

Correct Answer:
All of the above

Question 19
0 out of 5 points
A company reports the following information for the current year which is its first year of operations. Units produced this year Units sold this year Direct materials Direct labor Variable overhead Fixed overhead ? units 1,500 units $9 per unit $5 per unit $7 per unit $24,000 in total

If the company's cost per unit of finished goods using absorption costing is $27, how many units were produced?

Answer Selected Answer: 2,000 units Correct Answer:


4,000 units

Question 20
5 out of 5 points
A corporation issued 5,000 shares of $10 par value common stock in exchange for some land with a market value of $60,000. The entry to record this exchange is: (A) Land Common Stock Contributed Capital in Excess of Par Value, Common Stock (B) Land Common Stock (C) Land Common Stock (D) Common Stock 50,000 50,000 50,000 60,000 60,000 60,000 50,000 10,000

Contributed Capital in Excess of Par Value, 10,000 Common Stock Land (E) Common Stock Land 60,000 60,000 60,000

Answer

Selected Answer:
(A) above

Correct Answer:
(A) above

Question 21
5 out of 5 points
The following data are available for a company's manufacturing activities: Beginning goods in process inventory Units started and completed Ending goods in process inventory 5,000 units, 1/4 of the labor added this period 15,000 6,000 units, 1/2 the labor added this period

If materials are added when the production process begins and direct labor is applied uniformly throughout the process, what are the equivalent units for direct materials and for direct labor, respectively?

Answer Selected Answer:


21,000; 19,250

Correct Answer:
21,000; 19,250

Question 22
5 out of 5 points
Employee morale, timeliness of delivery, and the reactions of customers are examples of nonfinancial factors which should be considered when making a managerial decision.

Answer Selected Answer: Correct Answer:

True True 5 out of 5 points

Question 23
Accounting standards:

Answer Selected Answer:


Require that companies include a statement of cash flows in a complete set of financial statements

Correct Answer:
Require that companies include a statement of cash flows in a complete set of financial statements

Question 24
5 out of 5 points
A company declared a $0.50 per share cash dividend. The company has 20,000 shares authorized, 9,000 shares issued, and 8,000 shares of common stock outstanding. (A) Retained Earnings Common Dividends Payable 4,000 4,000

(B)

Common Dividends Payable Cash

4,000 4,000 4,500 4,500 4,500 4,500 5,000 5,000

(C)

Retained Earnings Common Dividends Payable

(D)

Common Dividends Payable Cash

(E)

Retained Earnings Common Dividends Payable

Answer Selected Answer:


(A) above

Correct Answer:
(A) above

Question 25
5 out of 5 points
A decrease in the fair market value of a security that has not yet been realized through an actual sale of the security is called a(n):

Answer Selected Answer:


Unrealized loss

Correct Answer:
Unrealized loss

Question 26
5 out of 5 points
Estimated overhead and direct labor costs for the year were $112,500 and $125,000, respectively. During the year, actual overhead was $107,400 and actual direct labor cost was $120,000. The entry to close the over- or underapplied overhead at year-end, assuming an immaterial amount, would include:

Answer Selected Answer:


A credit to Cost of Goods Sold for $600

Correct Answer:
A credit to Cost of Goods Sold for $600

Question 27
5 out of 5 points
At acquisition, debt securities are:

Answer Selected Answer:


Recorded at cost

Correct Answer:
Recorded at cost

Question 28
0 out of 5 points

Vision Tester, Inc., a manufacturer of optical glass, began operations on February 1 of the current year. During this time, the company produced 900,000 units and sold 800,000 units at a sales price of $12 per unit. Cost information for this year is shown below. Production costs Direct materials Direct labor Variable overhead Fixed overhead Non-production costs Variable selling and administrative Fixed selling and administrative $30,000 in total $490,000 in total $.80 per unit $.70 per unit $500,000 in total $450,000 in total

Given this information, which of the following is true?

Answer Selected Answer:


Net income under variable costing will exceed net income under absorption costing by $60,000.

Correct Answer:
Net income under absorption costing will exceed net income under variable costing by $50,000.

Question 29
5 out of 5 points
Long-term investments can include:

Answer Selected Answer:


All of the above

Correct Answer:
All of the above

Question 30
5 out of 5 points
The following company information is available: Direct materials used for production Standard quality for units produced Standard cost per gallon of direct material Actual cost per gallon of direct material The direct materials quantity variance is: 36,000 gallons 34,400 gallons $6.00 $6.10

Answer Selected Answer:


$ 9,600 unfavorable

Correct Answer:
$ 9,600 unfavorable

Saturday, November 24, 2012 4:27:56 PM EST