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Study Resources (Accounting)

138) The following data relates to Logan Electric and its Light Bulb Division. Light Bulb Division sales $ 7,500,000 Light Bulb Division operating income $ 750,000 Light Bulb Division total assets $ 3,000,000 Light Bulb Division current liabilities $ 550,000 Corporate target rate of return 15% Corporate weighted average cost of capital 11% Corporate effective tax rate 35% What is the Light.
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61) Dozen Bakery makes cupcakes and cookies. Dozen gathered the following information for the current year regarding its use of flour and butter (flour is a direct material for cupcakes and butter is a direct material for cookies): Flour (Direct Materials) Cupcakes Butter (Direct Materials) Cookies Standard quantity per batch 2 lbs. 3 lbs. Standard price per pound.
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192) The Berwin Company established a master budget volume of 35,000 units for April. Actual overhead costs incurred amounted to $98,500. Actual production for the month was 34,000 units. The standard variable overhead rate was $1.75 per direct labor hour. The standard fixed overhead rate was $1.50 per direct labor.
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142) Nixon's Diner bakes pies in large batches. One batch of pies has the following standard costs and amounts: Standard quantity of sugar (pounds) 115 Standard cost per pound of sugar $ 2.10 Standard direct labor hours per batch of pies 1.5 Standard direct labor cost per hour $ 19.00 Nixon's Diner baked 425 batches of pies in the.
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71) Puget Company has gathered the following information about its purchase and use of raw materials for December: Standard price per pound of raw material $ 12.00 Actual purchase price per pound of raw material $ 11.50 Standard quantity allowed for actual production (pounds) 1,000 Actual quantity of raw materials purchased (pounds) 1,150 Puget Company uses a standard cost.
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88) Total assets is used in the denominator when calculating ROI. 89) Sales margin is calculated as operating income divided by sales. 90) Capital turnover is calculated as operating income divided by total assets. 91) The use of return on investment (ROI) as a performance measure may lead managers to reject projects that.
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181) Luka Company uses the following overhead standard costs for a single unit of product: 7.5 hours at $13.50 per hour. Actual data for the month showed overhead costs of $132,000 for 1,800 units produced. What is the difference between actual overhead costs and standard overhead costs allocated to products? A).
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118) Golden Corporation has operating income of $336,000, a sales margin of 16%, and capital turnover of 3.0. The return on investment (ROI) for Golden Corporation would be closest to A) 5%. B) 48%. C) 2%. D) 160%. 119) Kleeman Company has a sales margin of 16%, operating income of $336,000, and capital turnover of.
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31) The direct materials price variance is calculated as A) the difference in quantities multiplied by the actual price of the input. B) the actual amount of direct materials purchased divided by the actual quantity. C) the difference in prices multiplied by the actual quantity of the input purchased. D) the actual quantity.
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106) The following information describes a company's usage of direct labor in a recent period: Actual direct labor hours used 34,000 Actual rate per hour $17.00 Standard rate per hour $16.75 Standard hours for units produced 33,500 How much is the direct labor rate variance? A) $8,375 favorable B) $8,500 favorable C) $8,375 unfavorable D) $8,500 unfavorable 107) The actual cost of direct labor.
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85) The following direct materials variance computations are incomplete. Fill in the missing values, and identify the direct materials flexible budget variance as favorable or unfavorable. Direct materials price variance = ($? - $12.50) × 7,000 pounds = $3,500 U Direct materials quantity variance = (? - 6,700 pounds) × $12.50 =.
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176) The balanced scorecard considers only financial performance measures. 177) Financial performance measures are known as lag indicators. A lag indicator is a performance measure that predicts future performance. 178) Customer satisfaction, operational efficiency, and employee excellence are often measured as part of the balanced scorecard approach. 179) The ultimate purpose of the.
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193) If production remains within the relevant range for the period, fixed costs are expected to remain fixed. 194) The fixed overhead budget variance measures the difference between the actual fixed overhead costs incurred and the budgeted fixed overhead costs. 195) The cause of a fixed overhead variance, such as an unanticipated.
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173) Civic Corporation provided the following partially completed monthly flexible budget. Complete the flexible budget. 174) Thomas Corporation sells a unit of its product for $12.00, resulting in a contribution margin of $7.00 per unit. Fixed costs are budgeted at $50,000 per quarter for volumes up to 12,000 units and $80,000.
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41) Jackson Industries has collected the following data for one of its products: Direct materials standard (6 pounds per unit @ $0.55/lb.) $3.30 per finished good Direct materials flexible budget variance-unfavorable $12,000 Actual direct materials used 35,000 pounds Actual finished goods produced 26,000 units What is the actual cost of the direct materials used per pound? A) $2.79 B) $2.45 C) $2.11 D).
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186) The number of repeat customers would be an example of measuring which perspective? A) Customer B) Financial C) Internal business D) Learning and growth 187) The number of new services offered during the period would be an example of measuring which perspective? A) Financial B) Customer C) Internal business D) Learning and growth 188) Company growth rates (compared.
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108) The Sunny Division of Miami Corporation reported the following results from the past year. Shareholders require a return of 10%. Management calculated a weighted-average cost of capital (WACC) of 5%. Sunny's corporate tax rate is 30%. Sales $ 700,000 Operating income $250,000 Total assets $1,500000 Current liabilities 600,000 What is the division's Residual Income (RI)? A).
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11) Kalanja Designs, which produces earrings, is developing direct material standards. Each earring requires 0.52 kilograms of a special metal. The allowance for waste is 0.03 kilograms per earring, while the allowance for rejects is 0.02 kilograms per earring. What is the standard quantity of metal per earring? A) 0.52.
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189) On the line in front of each variance, put the letter of the department that is most likely responsible for that variance. A letter may be used more than once or not at all. A.Production department B.Marketing department C.Purchasing department D.Personnel department ____Direct labor rate variance ____Direct material price variance ____Sales volume variance ____Direct labor efficiency variance ____Direct.
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98) Which of the following financial performance measures can be used to compare potential projects of different sizes? A) ROI B) Residual income C) Sales revenue D) Operating income 99) Assume the Air Conditioning division of the General Appliance Corporation had the following results last year (in thousands). Management's target rate of return is 15%.
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150) The Engine Division of The Cleveland Automotive Corporation had sales of $7,200,000 and operating income of $864,000 last year. The total assets of the Engine Division were $3,200,000 while current liabilities were $800,000. The Cleveland Automotive Corporation's target rate of return is 13% while its weighted average cost of.
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128) Pendant Publishing reported the following results for its Textbook Division: Sales $ 2,200,000 Operating income $ 440,000 Total assets $ 1,100,000 Current liabilities $ 1,000,000 Pendant's target rate of return is 15% and the weighted average cost of capital is 10%. Its effective tax rate is 35%. What is the Textbook Division's capital turnover? A) 2.2 B) 2.5 C).
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232) Costanza Manufacturing gathered the following information for the year ended December 31: Actual sales $285,000 Standard sales $285,000 Standard cost of goods sold $200,000 Direct material price variance $4,200 Unfavorable Direct material quantity variance $900 Unfavorable Direct labor rate variance $3,000 Favorable Direct labor efficiency variance $900 Unfavorable Overhead flexible budget variance $2,250 Unfavorable Production volume variance $3,000 Favorable Selling and Administrative $55,000 Prepare a standard cost income statement for Costanza for the year ended December.
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138) On the line in front of each variance, enter the letters of the items needed to compute that variance. You will enter more than one item on each line. A. Actual labor rate B. Actual labor hours C. Standard labor rate D. Standard labor hours ______Direct labor rate variance ______Direct labor efficiency variance 139) Cuyahoga Corporation.
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213) If a company recognizes variances at the earliest point possible, raw materials inventory will be debited for the actual quantity of raw materials purchased and costed at the actual price paid per unit. 214) A debit balance in the direct materials price variance indicates the standard cost of materials was.
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86) Efficiency variances for direct labor show how changes in the usage of labor affect a company's profits. 87) The total direct labor variance is the sum of the direct labor rate variance and the direct labor efficiency variance. 88) The direct labor rate variance describes differences in the anticipated (standard) labor.
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83) Ayers Company reports the following standards for direct materials for the year: Standard cost per pound$4.75 Standard amount per finished good8.5 pounds During the year, 460,000 finished goods were produced. The direct materials price variance was $14,200 unfavorable. The direct materials flexible budget variance was $980 favorable. Calculate the following items regarding direct.
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126) Quinton's Salon cuts men's hair. Labor standards for each cut are as follows: Standard direct labor hours per cut .75 Standard direct labor rate $20.00 The following data relates to the haircuts during the month of October: Actual hours worked 160 Actual total labor cost $3,150 Actual number of haircuts 220 What is the labor efficiency variance for the month of.
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144) All variances discovered by management must be investigated. 145) Up-to-date standard costs provide a benchmark by which to evaluate actual costs and operations. 146) Managers will want to use management by exception to determine which variances are significant enough to warrant investigation. 147) Price and quantity variances are a way to motivate.
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96) The direct labor flexible budget variance can be divided into two variances: A) rate variance and price variance. B) price variance and usage variance. C) rate variance and efficiency variance. D) price variance and efficiency variance. 97) A favorable direct labor efficiency variance might indicate that A) higher skilled workers were used that performed the.
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155) Identify five benefits of standard costs. 156) The variable overhead efficiency variance is calculated as Actual Hours × (Actual Rate - Standard Rate). 157) The production volume variance is favorable whenever expected output is greater than actual output. 158) The variable overhead rate variance may be affected by both indirect labor and.
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51) Myles Company budgeted 10,500 pounds of direct materials costing $23.50 per pound to make 5,300 units of product. The company actually purchased 11,000 pounds of direct materials costing $25.00 per pound to make the 5,300 units. What is the direct materials price variance? A) $16,500 favorable B) $16,500 unfavorable C) $15,750 unfavorable D).
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162) The ________ is a budget based on multiple levels of projected sales or production. A) standard budget B) flexible budget C) static budget D) fixed budget 163) With regard to flexible budgets, which of the following statements is true? A) They are prepared for one level of sales volume. B) Managers use them to.
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151) The Jazz Division of Heights Recording Corporation had the following results last year. Sales $10,000,000 Operating income $ 2,200,000 Total assets $4,000,000 Current liabilities $ 2,500,000 Management's target rate of return is 12% and the weighted average cost of capital is 9%. Its effective tax rate is 40%. Required: a.Calculate the return on investment (ROI). b.Calculate the residual income. .
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196) The ________ approach recognizes that both financial and operational performance measures should be considered when evaluating company performance. A) financial and operational B) total C) complete D) balanced scorecard 197) The ________ perspective from the balanced scorecard helps managers answer the question, "How do we look to shareholders?" A) financial B) internal business.
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140) Pyne Corporation's actual output for a period was assigned the standard labor cost of $32,500. If the company had an unfavorable direct labor rate variance of $1,750 and a favorable direct labor efficiency variance of $975, what was the total actual cost of direct labor incurred during the period? 141).
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191) LampLight Industries gathered the following information for the month of July: Overhead flexible budget: Number of units 10,000 13,000 16,000 Standard machine hours 13,500 17,500 21,500 Budgeted variable overhead costs: $30,000 $29,000 $48,000 Budgeted fixed overhead costs: $53,250 $53,500 $63,000 LampLight actually produced 14,000 units in 17,500 machine hours. Total actual overhead cost of $85,500 consisted of $35,000 variable costs and $50,500 fixed costs. The standard variable.
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116) Active Lifestyle Beverages gathered the following information for Job #928: Standard Total Cost Actual Total Cost Direct labor: Standard: 540 hours at $6.75/hr. 3,645 Actual: 500 hours at $6.50/hr. 3,250 What is the direct labor rate variance? A) $125 favorable B) $125 unfavorable C) $135 favorable D) $135 unfavorable 117) Active Lifestyle Beverages gathered the following information for Job #928: Standard Total Cost Actual.
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203) Shamrock Manufacturing budgeted fixed overhead costs of $2.75 per unit at an anticipated production level of 1,350 units. In July Shamrock incurred actual fixed overhead costs of $4,400 and actually produced 1,300 units. What is Shamrock's fixed overhead budget variance for July? A) $687.50 favorable B) $687.50 unfavorable C) $825.00 favorable D) $825.00 unfavorable 204).
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143) Weissfeld Corporation manufactures a single product. The direct materials standard calls for 5 pounds of direct material per unit. The standard for direct material cost per pound is $10. A computer error has wiped out the records for the direct labor standards but the following information is found for.
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21) If the standard quantity allowed for direct materials is greater than the actual quantity used, the quantity variance is unfavorable. 22) A quantity variance for production inputs is the difference between the actual quantity of input and the standard quantity of input, multiplied by the standard unit price of input. 23).
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171) Speaker City designs and manufactures high-end home theater speakers. Speaker City uses a standard overhead rate of 3.5 hours per unit at a cost of $9.50 per hour. Data for the month of June shows that Speaker City produced 500 units and recorded actual overhead costs of $19,500. What.
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161) The variable overhead rate variance tells managers whether more or less was spent on variable overhead than they expected for the hours worked. 162) The total variable manufacturing overhead variance is composed of the rate variance and the efficiency variance. 163) How is the variable manufacturing overhead efficiency variance calculated? A).
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81) On the line in front of each variance, enter the letters of the items needed to compute that variance. You will enter more than one item on each line. A.Actual price B.Actual quantity C.Standard price D.Standard quantity ______Direct materials price variance ______Direct materials quantity variance 82) McNabb Corporation makes shoe polish. The standard direct materials quantity.
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233) Standard Products Company recognizes variances from standards at the earliest opportunity, and the quantity of direct materials purchased is equal to the quantity used. The following information is available for the most recent month. Assume the allocation base for fixed overhead costs is the number of units. Direct MaterialsDirect Labor Standard.
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