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59) The standard cost of direct material for each lamps produced is A) $48.00. B) $40.00. C) $44.00. D) $21.00. 60) The direct-material price variance for October is A) $420 unfavourable. B) $420 favourable. C) $400 favourable. D) $400 unfavourable. 61) The direct-material usage variance for October is A) $220 unfavourable. B) $220 favourable. C) $200 unfavourable. D) $200 favourable. 62) The direct-labour price variance.
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113) The Quast Company is considering a capital investment project that requires an investment of $37,910.  The project is expected to have annual cash inflows of $10,000 occurring at the end of each of the next five years. a. Determine the internal rate of return for the project. b. Determine the net.
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Use the following information to answer the next question(s): The standard cost sheet for one of the Vitton Company's products is presented below. Direct materials (4 feet @ $6.00) $24.00 Direct labour (1 hour @ $12.00) 12.00 Variable overhead (1 hour @ $5.00) 5.00 Fixed overhead (1 hour @ $3.00*) 3.00 Standard unit cost $44.00 *Rate based on expected activity of 12,000.
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36) The second step in preparing the master budget is preparing the A) sales budget. B) budgeted income statement. C) cash budget. D) budgeted balance sheet. 37) The last step in preparing the financial budget is preparing the A) budgeted income statement. B) cash budget. C) budgeted balance sheet. D) sales budget. 38) Expenses that are NOT influenced by sales.
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76) When budgets are formulated with the active participation of all affected employees, the process is called A) financial budgeting. B) mathematical budgeting. C) participative budgeting. D) relative budgeting. 77) Which of the following statements is NOT true? A) Managers often compare actual results with budgets in evaluating subordinates. B) Too often, top management and accountants are.
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1) A budget is a formal, quantitative expression of plans that provides a benchmark against which to measure actual performance. 2) A capital budget is a periodic business plan that includes a coordinated set of detailed operating schedules and financial statements. 3) An operating budget is the major part of a master.
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110) The Malloy Corporation is contemplating the replacement of some old equipment. The pertinent information is as follows: Replacement Old Equipment  Equipment  Original cost$36,000$30,000 Useful life in years106 Current age in years40 Book value$24,000- Disposal value now$17,500- Disposal value in 6 years00 Annual cash operating costs$   9,000$   5,500 Required: Prepare a cost comparison of all relevant items for the.
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71) The cost of capital for the firm is A) 8%. B) 6%. C) 10%. D) 12%. 72) Using the cost capital as the discount rate, the net present value of the project is A) $89,360. B) $108,480. C) $114,680. D) $228,180. 73) The approximate internal rate of return of the project is A) 8%. B) 12%. C) 12.5%. D) 14%. 74) Miller Manufacturing has.
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82) The variance of actual results from the master budget. 83) A variance that occurs when actual expenses are more than budgeted expenses. 84) A budget that adjusts for changes in sales volume and other cost driver activities. 85) The variances between the flexible budget and the actual results. 86) The differences between the.
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61) Which of the following statements about depreciation is TRUE? A) The tax effects of depreciation are not adjusted for inflation. B) The tax effects of depreciation must be adjusted for inflation. C) Canadian tax laws allow for inflation adjustments to depreciation each year. D) Capital investment is encouraged by not allowing depreciation to.
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82) The tax rate paid on additional amounts of pretax income. 83) The process of determining which long-term capital assets to acquire. 84) Future cash flows expressed in present value terms. 85) The factor used to convert  future cash flow to its present value. 86) The value that will accumulate by the end of.
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106) The Markey Company prepared the following sales budget: Month Budgeted Sales March$250,000 April265,000  May255,000 June272,500 July262,500 In addition, the gross profit rate is 40 percent and the desired inventory level is 30 percent of next month's sales. Required: Prepare a purchases budget for April through June. 107) Bergstrom Corporation prepared the following sales budget:    Month    Budgeted Sales June$136,000 July144,000 August148,000 September152,000 October156,000 The cost.
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108) DOCA Corp. is considering the following two capital projects: Machine AMachine B Cost$200,000$150,000 Additional annual revenues$220,000$  80,000 Additional annual cash expenses$140,000$  30,000 Terminal salvage value-0--0- Required after-tax rate of return10%10% Useful life of machine5 yrs.5 yrs. Appropriate tax rate25%25% CCA class9(25%)9(25%) Additional data (for interest rate of 10 percent, 5 periods): Present value of $10.6209 Future value of $11.6105 Present value of annuity.
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102) Warren Company's overhead cost information is given below: Standard applied overhead$152,000 Budgeted overhead based on standard machine hours allowed162,000 Budgeted overhead based on actual machine hours used170,000 Actual overhead166,000 Required: a.Compute the total overhead variance. b.Calculate the flexible-budget variance. c.Determine the fixed overhead volume variance. 103) The following information was compiled by Bovinnette Company: Expected volume of production100,000 units Actual level of.
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92) Any capital budgeting model that explicitly considers the time value of money in identifying criteria for accepting or rejecting proposed projects. 93) The rate of return used to compute the present value of future cash flows. 94) The rate of return that equates the present value of a project's cash inflows.
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Beta Company has the following information: Number of Years         5              10               15       Amount of annual cash inflow $8,000 (c) $ 4,200 Required initial investment (a) $100,000 $32,000 Internal rate of return 8 percent 10 percent (e) Minimum desired rate of return 10 percent (d) 8 Percent Net present value (b) $ 5,200 (f) 21) What is (a)? A) $31,944 B) $30,328 C) $11,747 D) $12,882 22) What is (b)? A) $-0- B) $(1,616) C).
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111) A capital investment project requires an investment of $200,000.  It has an expected life of 5 years with annual cash flows of $50,000 received at the end of each year. a. Compute the payback period for the project. b. Determine the accounting rate of return for the project based on the.
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116) Lawton Co. is evaluating a project that requires an investment of $400,000. The company plans to dispose of the property at the end of the fourth year for $121,620. Information about cash flows associated with the project is as follows: Annual revenues$250,000 Annual operating costs$100,000 All cash flows occur at the end.
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97) Given the following data: DirectDirect MaterialLabour Standard price per unit of input$15 per foot$15 per hour Actual price per unit of input$17 per foot$14 per hour Standard inputs allowed per unit of output4 feet2 hours Actual units of input1,750 feet850 hours Actual units produced400 units Required: Compute the price, usage and flexible-budget variances for direct material and.
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105) The Garson Company manufactures roofing shingles.  The production process involves heating and compressing asphalt into sheets and then rolling coarse sand into the hot asphalt.  The sheets are then cooled, cut into shingles, and packaged. The following standard costs were developed: STANDARD COST CARD PER SHINGLE Materials: Asphalt2 lbs. x $0.08/lb.$0.16 Sand2 lbs. x.
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111) Chinn Company has gathered the following information: March 31, cash balance, $64,000 Amortization expense for April, $13,400 Dividends paid in April, $23,000 Cash collections in April, $142,000 Equipment purchased for cash in April, $27,200 Cash paid for operating expenses in April, $59,600 Merchandise paid for in April, $84,600 Chinn requires a minimum cash balance of $10,000. Required: Prepare.
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1) Flexible budgets are designed to show different possible costs for one anticipated level of output. 2) All master budgets are prepared for only one level of activity. 3) In a flexible budget, the fixed costs will remain constant regardless of different levels of activity shown in the budget. 4) A performance report.
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56) The total cash collections in July will be A) $140,000. B) $126,000. C) $80,000. D) $66,000. 57) The total cash collections in August will be A) $180,000. B) $100,000. C) $165,000. D) $ 85,000. 58) The total cash received in June on June sales will be A) $ 70,000. B) $100,000. C) $ 86,000. D) $ 46,000. 59) The total cash received in May.
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16) Decisions made during long-range planning include all of the following EXCEPT A) addition or deletion of product line. B) design and location of new plants. C) acquisitions of buildings and equipment. D) acquisition of office supplies. 17) Managers need budgets for all of the following reasons EXCEPT A) to guide them in allocating resources. B) to.
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29) What are the total selling and administrative expenses for 15,000 units? A) $300,000 B) $ 45,000 C) $ 55,000 D) $270,000 30) What is the net income for 10,000 units? A) $90,000 B) $120,000 C) $300,000 D) $270,000 31) What is the net income for 15,000 units? A) $450,000 B) $180,000 C) $405,000 D) $150,000 Woodlund Company had the following information: Selling price per unit $120 Variable.
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39) What is the cost function? A) Costs = $ 75,000 + $0.098(Lines) B) Costs = $ 75,000 + $0.068(Lines) C) Costs = $245,000 + $0.068(Lines) D) Cannot be determined 40) What would be the total flexible budget if the number of lines increased to 2,600,000? A) $176,800 B) $245,000 C) $251,800 D) Cannot be determined 41) Identify which of.
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114) The Serena Company is evaluating two mutually exclusive projects with three-year lives.  Each project requires an investment of $10,000.  The projects have the following cash inflows received at the end of each year. YEARPROJECT 1PROJECT 2 1$2,000$  6,000 24,0004,000 36,0002,000 TOTAL$12,000$12,000 a. Determine the net present value of each project using an 8% discount rate. b..
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69) For Product Y, the total standard material cost for producing the 300 units was A) $9,000. B) $9,900. C) $13,200. D) $12,000. 70) For Product Y, the total actual cost for producing the 300 units was A) $9,000. B) $9,900. C) $12,000. D) $13,200. 71) When actual volume is less than expected volume, the fixed overhead volume variance is A).
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31) Assume straight-line amortization in all computations, and ignore income taxes. The internal rate of return in case Y is approximately A) 10 percent. B) 12 percent. C) 14 percent. D) 16 percent. Below are two potential investment alternatives: Case X Case Y Initial capital investment $120,000 $180,000 Estimated useful life          3 yrs.           3 yrs. Estimated terminal salvage value           -0-           -0- Estimated annual savings.
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104) Kline Corporation has prepared the following sales budget: Month   Cash SalesCredit Sales May$ 80,000$340,000 June100,000400,000 July90,000 370,000 August120,000460,000 September110,000380,000 Collections are 40 percent in the month of sale, 45 percent in the month following the sale, and 10 percent two months following the sale. The remaining 5 percent is expected to be uncollectible. Required: Prepare a schedule.
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106) Knight, Inc. produces three products using a joint process which requires $115,000 in joint costs. The products A, B and C can be sold at split-off or processed further and then sold. The production level for each product is 8,000 units. The following unit information is also available: Separable Processing Sales ValueCosts.
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49) A favourable sales-activity variance means that A) managers have been efficient in the implementation of a sales budget. B) managers have been effective in accomplishing a planned sales level. C) demand for the company product is strong. D) the sales force has done an excellent job. The following data are for Parker Corporation for.
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87) A plan of action expressed in financial terms. 88) The portion of the master budget where a future month is added as the current month expires. 89) The collection of all area and activity budgets, representing a firm's comprehensive plan of action. 90) Budgets associated with the income-producing activities of an organization. 91).
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26) An example of a financial budget is a(n) A) sales budget. B) cash budget. C) purchases budget. D) budgeted income statement. 27) Which of the following is a major part of the master budget that focuses on the income statement and its supporting schedules? A) Operating budget B) Financial budget C) Cash budget D) Capital budget 28) Which of.
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66) The total cash disbursements in March for the purchase of merchandise should be A) $152,600. B) $145,000. C) $141,360. D) $147,700. 67) The total cash disbursements in May for the purchase of merchandise should be A) $138,400. B) $148,580. C) $ 69,200. D) $128,160. Mickle Company has the following information: Month Budgeted Purchases August $175,000 September 190,000 October 217,500 November 182,500 December 230,000 Purchases are paid for in the following manner: 20.
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106) The annual income statement of ZAP Inc. shows the following items: Sales$800,000 Total expenses (excluding amortization)$560,000 Amortization$160,000 Average income tax rate20 percent Capital Cost Allowance$140,000 Required: Compute the following amounts (ignore present value considerations): a.Net after-tax accounting income b.Total net after-tax cash inflow from operations 107) The owner of a construction company is contemplating possible purchase of new.
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109) Taylor, Inc. provided the following information:   Month Budgeted Sales June$194,000 July186,000 August172,000 September178,000 Budgeted Expenses per Month: Wages$16,400 Advertising13,600 Amortization8,600 Rent10,200 Freight-out3 percent of sales Other5 percent of sales Note: All cash expenses are paid when incurred. Required: Prepare a combined schedule of total operating expenses and cash disbursements for expensesfor July through September. 110) Johnson Company has gathered the following information: April 30,.
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112) A capital investment project requires an investment of $50,000 and has an expected life of four years.  Annual cash flows at the end of each year are expected to be as follows: YEARAMOUNT 1$15,000 220,000 325,000 415,000 a. Compute the payback period assuming that the cash flows occur evenly throughout the year. b. Determine the accounting.
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11) In most companies, variances are investigated only if they exceed a minimum dollar or percentage deviation from budgeted amounts. 12) The total flexible-budget variance can be broken down into a price variance and a usage variance. 13) A usage variance measures actual deviations from the quantity of inputs that should have.
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104) The Walton Manufacturing Company has developed the following standards for one of their products, a walnut fern stand. _______________________________________________________ STANDARD VARIABLE COST CARD One Walnut Fern Stand Materials:  5 square feet x $8 per square foot$40.00 Direct labour:  2 hours x $10/DLH20.00 Variable manufacturing overhead:  2 hours x $5/DLH  10.00 Total standard variable cost per unit$70.00 _______________________________________________________ The.
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Below are two potential investment alternatives: Case X Case Y Initial capital investment $120,000 $180,000 Estimated useful life          3 yrs.           3 yrs. Estimated terminal salvage value           -0-           -0- Estimated annual savings in cash operating costs $ 50,000 $ 80,000 Minimum desired rate of return 10 percent    12 percent PV of $1 (3 years) PV of an Annuity of $1 (3 years)    8 percent 0.7938 2.5771 10.
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99) The following data pertain to June operations for the Harley Company: Actual InputsActual Price for Each Unitper Unit     of Output      of Input Direct material10 yards$  8 per yard Direct labour2 hours$10 per hour Actual output was 750 units. The Company's per unit standards call for 9 yards of direct material at $9.00 per.
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46) The desired ending inventory for July is A) $39,000. B) $42,250. C) $21,000. D) $31,000. 47) The total purchases budgeted for June should be A) $204,750. B) $164,125. C) $162,500. D) $ 87,500. 48) The total purchases budgeted for July should be A) $169,000. B) $208,000. C) $165,750. D) none of the above. Ogden Manufacturing Company has the following information: Month Budgeted Sales January $190,000 February 212,500 March 230,000 April 197,500 Budgeted Expenses per.
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