Question Details

Finance Homework Help

1. (TCO 3) Managers are often required to make decisions about the future based on all the following except:
2. (TCO 3) The process of creating a formal plan and translating goals into a quantitative format is called:
3. (TCO 3) The Coyote Cafe had sales revenues and food costs in 2007 of $800,000 and $600,000, respectively. In 2008, Coyote will be introducing a new menu item that will generate $100,000 in sales revenues and $45,000 in food costs. Assuming no changes are expected for the other food items, the differential revenue for 2008 is:
4. (TCO 1) The terms direct cost and indirect cost are commonly used in accounting. A particular cost might be considered a direct cost of a manufacturing department, but an indirect cost of the product produced in the manufacturing department. Classifying a cost as either direct or indirect depends upon:
5. (TCO 1) Which of the following is NOT a product cost under full absorption costing?

6. (TCO 1) Calculate the prime costs from the following information:

   Fixed manufacturing overhead	$2,000
   Variable manufacturing overhead	1,500
   Direct materials	4,000
   Direct labor	3,000

7. (TCO 1) The excess of sales over variable costs is termed:
8. (TCO 6) Western Sales has the following information concerning its one and only product: 
9. (TCO 6) When the sales volume equals total costs and there is zero profit or loss, this is termed:

10. (TCO 6) Western Sales has the following information concerning its one and only product:  

    Selling price per unit:   $40
    Variable cost per unit:  $15
    Total fixed costs:        $250,000
     
    Compute the break-even point in units.

11. (TCO 5) The time from research and development until the support to the customer ends is termed:

12. (TCO 5) Costs that differ between two or more alternatives are termed:

13. (TCO 5) Which of the following costs are irrelevant for a special order that will allow an organization to utilize some of its present idle capacity?

14. (TCO 3) The cost estimation method that is based on two cost observations is called the:

15. (TCO 3) We use cost estimation to determine:

16. (TCO 3) The systematic relationship between the amount of experience in performing a task and the time required to perform it is known as the:

17. (TCO 2) Which of the following statements does not reflect one of the fundamental themes underlying the design of cost systems for managerial purposes?

18. (TCO 2) In a labor intensive company in which more overhead is used by the more highly skilled and paid employees, which activity base would be most appropriate for applying overhead to production?

19. (TCO 2) What is the amount transferred in for Case C? 
     

    Case C
    Beginning balance	$7,900
    Ending balance	8,300
    Transferred in	????
    Transferred out	21,100

20. (TCO 2) The UVW Manufacturing Company produces a single uniform product throughout the year. Which of the following product costing systems should be used by UVW?
21. (TCO 6) T-Tunes, Inc. is considering the introduction of a new music player with the following price and cost characteristics: 
    
    Sales price per unit:    $125 
    Variable cost per unit: $80
    Annual fixed costs:     $180,000
    
    (a) How many units must T-Tunes sell to break even?
    (b) How many units must T-Tunes sell to make an operating profit of $120,000 for the year?
    (c) What will the operating profit be, assuming that the projected sales for the year are 7,500 units?
    
    Consider requirements (b) and (c) independent of each other.

22. (TCO 4) Kramer Company has decided to use a predetermined rate to assign factory overhead to production. The following predictions have been made for 2010:
     

    Total factory overhead costs	$180,000
    Direct labor hours	50,000 hours
    Direct labor costs	$250,000
    Machine hours	60,000 hours

    Compute the predetermined factory overhead rate under three different bases: (1) direct labor hours, (2) direct labor costs, and (3) machine hours.

23. (TCO 1) Best Corporation incurred the following costs:
     

    Beginning direct materials inventory	$ 17,000
    Beginning work-in-process inventory	8,000
    Beginning finished goods inventory	18,000
    Ending direct materials inventory	15,000
    Ending work-in-process	13,000
    Ending finished goods	24,000
    Factory supervisor's salary	25,000
    Depreciation on plant	10,000
    Sales	650,000
    Selling and administrative expenses	100,000
    Plant maintenance	5,000
    Plant utilities	9,000
    Direct material purchases	185,000
    Direct labor	200,000

    Calculate the following values:

    (a)	direct materials used
    (b)	cost of goods manufactured
    (c)	cost of goods sold
    (d)	net income

24. (TCO 5) The following information relates to a product produced by Bayfield Company:

    Direct materials	$50
    Direct labor	35
    Variable overhead	30
    Fixed overhead	40
    Unit cost	$155

    
    Fixed selling costs are $1,000,000 per year. Although production capacity is 900,000 units per year, Bayfield expects to produce only 800,000 units next year. The product normally sells for $180 each. A customer has offered to buy 60,000 units for $150 each. Compute the effect on the net income if Bayfield accepts the special order.