Tag: accounting

“65. Consider the following production and cost data for two products, L and C: Product L Product C Contribution margin per unit $120 $112 Machine set-ups needed per unit 10 set-ups 8 set-ups The company can perform 60,000 machine set-ups each period and there is unlimited demand for each product. What is the largest possible total contribution margin that can be realized each period? a. $720,000. b. $840,000. c. $780,000. d. $1,560,000.”,”2Contribution Margin per Machine set-ups: Product L = 120/10 = $12/setup Product C = 112/8 = $14/setupProduct C can produce the largest possible contribution margin because its CM/set-ups is $14, compared to Product L’s $12.Product C:Machine set-ups each period = 60,000 = 7,500 unitsMachine set-ups needed per unit 8CM = Number of Units x CM $ per unitContribution Margin = 7,500 x $112 = $840

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.“65. Consider the following production[…]

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“34. For planning, control, and decision-making purposes a. fixed costs should be considered on a per unit basis. b. fixed costs should be ignored totally. c. fixed costs should be considered noncontrollable even at the highest levels of management of an organization. d. mixed costs should be separated into their variable and fixed components.”

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.“34. For planning, control, and[…]

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50. Which of the following statements is false? a. The size of a variance relative to the amount of spending involved is one factor in determining which variances to investigate. b. Focusing on variances that are above a certain dollar amount is the only way to identify variances that are true exceptions. c. Some random fluctuations in variances from period to period are normal and to be expected even when costs are well under control. d. A variance should only be investigated when it is unusual relative to the normal level of fluctuation in the variance.

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.50. Which of the following[…]

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51. Which of the following is not an advantage typically associated with standard costs? a. Standard costs facilitate cash planning and inventory planning. b. Standard costs facilitate income determination and record keeping. c. Standard costs are equally applicable to companies operating in an automated environment as to companies where automation is not a major factor. d. Standard costs are fundamental to responsibility accounting.

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.51. Which of the following[…]

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67. In which of the following situations would a project be acceptable under the time-adjusted rate of return method? I. The time-adjusted rate of return is equal to the cost of capital. II. The time-adjusted rate of return is greater than the cost of capital. III. The time-adjusted rate of return is less than or equal to the cost of capital. a. Only I. b. Only III. c. Only II. d. Both I and II.

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.67. In which of the[…]

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68. The management of a company considering an investment in automated equipment should consider: a. primarily the reduction in direct labor cost since this reduction usually is sufficient to justify the investment. b. only the quantifiable tangible aspects of the benefits of automation that can be used to calculate the net present value or the time-adjusted rate of return. c. both the tangible and intangible benefits of automation including an attempt to quantify the intangible benefits. d. the need for total automation rather than a piecemeal approach.

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.68. The management of a[…]

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