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Study Resources (Accounting)

136) 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 return15% Corporate weighted average cost of capital11% Corporate effective tax rate35% What is the Light Bulb Division's sales margin? A).
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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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128) Akron Clay Company manufactures flowerpots. The following data relate to the standards for direct labor: Standard direct labor hours per pot.5 Standard direct labor rate per hour$18.75 Akron Clay Company had the following actual results for April: Actual direct labor hours4,100 Actual total direct labor cost$78,000 Actual number of pots produced8,350 What is the direct labor.
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146) Selected financial data for the Photocopies Division of Elizabeth's Business Machines is as follows: Sales$6,800,000 Operating income$2,040,000 Total assets $2,720,000 Current liabilities $350,000 Required rate of return13% Weighted average cost of capital8% What is the Photocopier Division's sales margin? A) 250.00% B) 75.00% C) 5.15% D) 30.00% 147) Selected financial data for the Photocopies Division of Elizabeth's Business Machines is as.
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190) Employee satisfaction would be an example of measuring which perspective of the balanced scorecard? A) Financial B) Customer C) Learning and growth D) Internal business 191) The number of repeat customers may be an example of measuring which perspective of the balanced scorecard? A) Customer B) Financial C) Internal business D) Learning and growth 192) The number.
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11) Decentralization allows top management to concentrate on long-term strategic planning. 12) Decentralization allows top management to hire workers with expert knowledge in each business unit. 13) Decentralization may duplicate a company's costs because each business unit can contain its own purchasing department. 14) Decentralized companies often struggle to achieve goal congruence in.
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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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194) Merchandising companies prepare a direct materials budget. 195) Merchandising companies prepare a manufacturing overhead budget. 196) The managerial accountant at the Holly and Ivy Tree Store reported that the company anticipates sales of $600,000 in September and October, $625,000 in November, $635,000 in December, and note that the sales figure.
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172) Peddlin' Pete's Cycles sells its entry-level bicycles for $400 each. Its variable cost is $250 per bicycle. Fixed costs are $35,000 per month for volumes up to 1,200 bicycles. Above 1,200 bicycles, monthly fixed costs are $55,000. What is the budgeted operating income at a level of 900 bicycles.
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116) What are the total assets reported by Sparrow Enterprises if operating income is $650,000, its return on investment (ROI) is 40%, and its target rate of return is 10%? A) $260,000 B) $1,625,000 C) $6,500,000 D) $650,000 117) Pigeon Forges' stakeholders require a 10% rate of return. The company currently has an ROI of.
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174) The master budget of a service company has fewer individual budget components compared to the master budget of a manufacturing company. 175) The operating budgets of retailers and manufacturers are virtually identical. 176) Merchandisers use a "cost of goods sold, inventory, and purchases budget" to calculate the amount of merchandise.
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66) All favorable variances are investigated when using management by exception. 67) Which type of variance causes operating income to be lower than the budgeted operating income? A) Favorable variance B) Neutral variance C) Unfavorable variance D) Reverse variance 68) Management by exception would dictate that the manager investigate which of the following variances? A) Variances which.
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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 (AQU)35,000 pounds Actual finished goods produced26,000 units What is the actual cost of the Direct Materials Used (AQU) per pound? A) $2.79 B).
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88) The direct labor rate variance describes differences in the anticipated (standard) labor rate and the actual labor rate paid. 89) The direct labor rate variance is calculated by multiplying the standard hours that should have been worked for the actual output by the difference between the standard labor rate and.
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21) A manager is only accountable for expenses in a(n) ________ center. A) cost B) revenue C) profit D) investment 22) To evaluate the performance of a(an) ________, a top manager is responsible for revenues, costs, and the efficient use of the assets invested in the division. A) cost center B) investment center C) profit center D).
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174) Capital Manufacturing designs and manufactures bathtubs for home and commercial applications. Capital recorded the following data for its commercial bathtub production line during the month of March: Standard DL hours per tub3 Standard overhead rate per DL hour$6.50 Standard overhead cost per unit$19.50 Actual overhead costs$22,750 Actual DL hours3,250 Actual overhead cost per machine hour$7.00 Actual.
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118) Razzle Baking Company gathered the following actual results for the current month: Actual amounts: Units produced5,500 Direct labor cost (10,000 hours)$53,000 Budgeted production and standard costs were: Budgeted production5,000 Direct labor2 hrs./unit at $9.00/hr. What is the direct labor rate variance? A) $40,700 unfavorable B) $40,700 favorable C) $37,000 unfavorable D) $37,000 favorable 119) Razzle Baking Company gathered.
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31) Lubrizol is a large chemical company that specializes in producing lubricants. Lubrizol was acquired in 2011 for $9 billion by investment holding company Berkshire Hathaway. Lubrizol may be classified as a(n) A) cost center. B) investment center. C) profit center. D) revenue center. 32) The reservations department that has self-contained sales operations at a.
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21) If the Standard Quantity Allowed (SQA) for direct materials is greater than the Actual Quantity (AQ) used, the quantity variance is unfavorable. 22) A quantity (efficiency) variance for production inputs (materials and labor) is the difference between the Actual Quantity (AQ) of input used and the standard quantity of input,.
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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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210) Cash flows from operations and gross margin growth may be examples of the A) customer perspective. B) financial perspective. C) internal business perspective. D) learning and growth perspective. 211) New product development time may be an example of the A) financial perspective. B) customer perspective. C) learning and growth perspective. D) internal business perspective. 212) List the four.
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86) Sales margin is a component of the Return on Investment (ROI) calculation. 87) The weighted average cost of capital is a component of the Return on Investment (ROI) calculation. 88) Total assets is the denominator in the formula managers use to compute ROI. 89) Sales margin is defined as operating income divided.
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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 pies1.5 Standard direct labor cost per hour$19.00 Nixon's Diner baked 425 batches of pies in the most recent.
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76) The performance evaluation of a profit center is typically based on its A) segment margin. B) static budget variance. C) return on investment. D) return on assets. 77) Rider Company had the following financial results for last month. Which type of responsibility center do these financial results reflect? Gretzel Subunit Actual Flexible BudgetFlexible Budget Variance (U or F) %.
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162) Flexible budgets are budgets that summarize cost and revenue information for a single volume level. 163) Both the static budget and the flexible budget used for performance evaluation are developed before the period of actual production. 164) The difference between the actual revenues and expenses and the master budget is known.
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184) The standard variable overhead cost rate for the Gordon Company is $11.25 per unit. Budgeted fixed overhead cost is $50,000. The company budgeted 5,000 units for the current period and actually produced 4,150 finished units. What is the fixed overhead volume variance? Assume the allocation base for fixed overhead.
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84) Miller Manufacturing Corporation has the following information regarding direct materials: Actual pounds of direct materials purchased and used47,000 Standard quantity of direct materials2.5 pounds per finished good Actual production20,000 finished goods Direct materials quantity variance$11,500 F Direct materials price variance$9,400 U Compute Miller's Standard Price (SP) per pound and Actual Price (AP) per pound of.
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71) Puget Company has gathered the following information about its purchase and use of raw materials for December: Standard Price (SP) per pound of raw material$12.00 Actual purchase price per pound of raw material$11.50 Standard Quantity Allowed (SQ.A for actual production (pounds)1,000 Actual Quantity (AQ) of raw materials purchased (pounds)1,150 Puget Company uses a standard cost.
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152) Hill Manufacturing is a large manufacturer that produces a part that inserts into diesel engines. The company has several large divisions and the managerial accountant reported the part is currentlyproduced in the assembly department. The managerial accountant reported that the variable selling expenses and manufacturing costs related to the.
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57) Discuss potential problems and disadvantages to an organization that decentralizes its operations. 58) The performance reports of cost centers only include those costs incurred within each individual cost center. 59) A performance report compares expected revenues and expenses against budgeted figures for each responsibility center that the manager evaluates in an.
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164) How is the variable overhead rate variance calculated? A) The difference between the actual overhead rate and the standard overhead rate multiplied by the actual hours B) The difference between the actual overhead rate and the standard overhead rate multiplied by the standard hours allowed C) The difference between the standard hours.
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154) When deciding whether or not to adopt standard costs and perform variance analysis, management should do which of the following? A) Examine the costs and benefits of a standard costing system B) Update inaccurate standard costs C) Adopt lean thinking D) Increase automation of assembly lines 155) Identify four advantages of standard costs and.
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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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1) There are two types of responsibility centers. 2) Responsibility accounting performance reports compare plans (budgets) with actual results in each responsibility center. 3) Goal congruence is a system that evaluates the performance of each responsibility center and its manager. 4)  A profit center is the responsibility center that is only responsible for.
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126) Izzy Division of Marine Boats Corporation had the following results last year (in thousands). Sales$4,500,000 Operating income$700,000 Total assets $4,000,000 Current liabilities $250,000 Management's target rate of return is 10% and the weighted average cost of capital is 8%. What is the Izzy Division's Residual Income (RI)? A) $70,000 B) $400,000 C) $700,000 D) $300,000 127) Pendant Publishing.
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31) The direct materials price variance is calculated as A) the difference in Actual Quantities (AQ) multiplied by the Actual Price (AP) of the input. B) the Actual Quantity (AQP) of direct materials divided by the Actual Quantity (AQ). C) the difference in prices of the Actual Quantity Purchased (AQP) and the Actual.
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200) The number of defects found during the manufacturing process may be an example of measuring which perspective of the balanced scorecard? A) Internal business B) Customer C) Financial D) Learning and growth 201) The ________ approach recognizes that both financial and operational performance measures should be considered when evaluating company performance. A) financial and operational.
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41)  Frito-Lay's Casa Grande plant that controls expenses using lean thinking to eliminate waste may be classified as a(n) A) cost center. B) investment center. C) profit center. D) revenue center. 42) Sales territories, such as geographic areas within the country may be classified as a(n) A) cost center. B) investment center. C) revenue center. D) profit center. 43).
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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) CupcakesButter (Direct Materials) Cookies Standard quantity per batch2 lbs.3 lbs. Standard Price (SP) per.
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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 (AP) B.Actual Quantity (AQ) C.Standard Price (SP) D.Standard quantity ________Direct materials price variance ________Direct materials quantity variance 82) McNabb Corporation makes shoe polish. The standard.
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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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184) In which of the following company types does a manager use an operating expenses budget? A) Manufacturing B) Merchandising C) Service D) All of the above 185) In which of the following company types does the manager use a "cost of goods sold, inventory, and purchases" budget? A) Merchandising B) Manufacturing C) Service D) All of.
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106) The Box Manufacturing Division of the Allied Paper Company reported the following results from the past year. Shareholders require a return of 7%. Management calculated a weighted-average cost of capital (WACC) of 5%. Allied's corporate tax rate is 30%. Sales$700,000 Operating income $175,000 Total assets$1,500000 Current liabilities 600,000 What is the division's Return.
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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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