Tag: accounting

“46. During 19×4, Roberts Company’s income under absorption costing was $2,000 lower than its income under variable costing. The company sold 8,000 units during the year, and its variable costs were $8 per unit, of which $2 was variable selling expense. If production cost was $10 per unit under absorption costing, then how many units did the company produce during the year? a. 7,500 units. b. 7,000 units. c. 9,000 units. d. 8,500 units.”,”1Production cost per unit under absorption = $10- Variable production cost per unit (8-2) = 6Fix MOH per unit 4Then the difference in income of $2000 is for 500 units (2000 / 4) Absorption income < variable income when units sold is > units produced.Units produced = 8,000 – 500 = 7

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.“46. During 19×4, Roberts Company’s[…]

Read more

“62. To maximize total contribution margin, a firm should: a. promote those products having the highest unit contribution margins. b. promote those products having the highest contribution margin ratios. c. promote those products having the highest contribution margin per unit of a constrained resource. d. promote those products having the highest contribution margins and contribution margin ratios.”

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.“62. To maximize total contribution[…]

Read more

47. A single-product company prepares income statements using both absorption and variable costing methods. Manufacturing overhead cost applied per unit produced in 1995 was the same as in 1994. The 1995 variable costing statement reported a profit whereas the 1995 absorption costing statement reported a loss. The difference in reported income could be explained by units produced in 1995 being a. Less than units sold in 1995. b. Less than the activity level used for allocating overhead to the product. c. In excess of the activity level used for allocating overhead to the product. d. In excess of units sold in 1995.

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.47. A single-product company prepares[…]

Read more

63. A plant operating at capacity would suggest that: a. every machine and person in the plant is working at the maximum possible rate. b. only some specific machines or processes must be operating at the maximum rate possible. c. fixed costs will need to change to accommodate increased demand. d. managers should produce those products with the highest contribution margin in order to deal with the constrained resource.

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.63. A plant operating at[…]

Read more

“32. Which of the following situations would result in activity-based costing not being beneficial to an entity? a. Products differ substantially in volume, lot size, or complexity of manufacture. b. A high statistical correlation exists between direct labor and the incurrence of overhead costs. c. Top management and marketing people use the new data to cost products more accurately and reflect a more approprtate selling price for its products. d. Products differ substantially in their need for various activities such as setups, inspections, and so forth, involved in the manufacturing process.”

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.“32. Which of the following[…]

Read more

48. The budgeted amount of raw materials to be purchased is determined by a. adding the desired ending inventory of raw materials to the raw materials needed to meet the production schedule. b. subtracting the beginning inventory of raw materials from the raw materials needed to meet the production schedule. c. adding the desired ending inventory of raw materials to the raw materials needed to meet the production schedule and subtracting the beginning inventory of raw materials. d. adding the beginning inventory of raw materials to the raw materials needed to meet the production schedule and subtracting the desired ending inventory of raw materials.

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.48. The budgeted amount of[…]

Read more

64. Which of the following regarding joint cost allocation is not true? a. The sales value of the end products is the most common method used to allocate joint costs. b. Inventory cost and cost of goods sold computations for internal reporting purposes require joint cost allocation. c. Inventory cost and cost of goods sold computations for external reporting purposes require joint cost allocation. d. Joint cost allocation is unnecessary in deciding to sell or process further beyond the split-off point.

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.64. Which of the following[…]

Read more

49. The standard rate per hour for direct labor should be established such that: a. a standard rate exists for each employee in each department. b. employment taxes are excluded from the standard rate per hour. c. both employment taxes and fringe benefits are excluded from the standard rate per hour. d. a single rate exists for all employees in a department that reflects an expected mix of workers.

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.49. The standard rate per[…]

Read more