1) Front Company had net income of $91,500 based on variable costing. Beginning and ending inventories were 2,700 units and 5,000 units, respectively. Assume the fixed overhead per unit was $8.85 for both the beginning and ending inventory. What is net income under absorption costing?
$71,145
$111,855
$159,645
$23,355
$92,850
2) Chance, Inc. sold 4,800 units of its product at a price of $162 per unit. Total variable cost per unit is $123, consisting of $86 in variable production cost and $37 in variable selling and administrative cost. Compute the manufacturing margin for the company under variable costing.
$412,800
$590,400
$364,800
$777,600
($403,200)
3) Geneva Co. reports the following information for July:
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Sales
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$807,000
|
|
Variable costs
|
244,000
|
|
Fixed costs
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119,000
|
Calculate the contribution margin for July.
$563,000
$444,000
$688,000
$807,000
4) A July sales forecast projects that 6,600 units are going to be sold at a price of $11.10 per unit. The management forecasts 15% growth in sales each month. Total July sales are anticipated to be:
$73,260.
$55,500.
$91,020.
$75,924.
$70,596.
5) Ratchet Manufacturing anticipates total sales for August, September, and October of $220,000, $230,000, and $240,500 respectively. Cash sales are normally 30% of total sales and the remaining sales are on credit. All credit sales are collected in the first month after the sale. Compute the amount of accounts receivable to be reported on the company's budgeted balance sheet for August.
$154,000.
$66,000.
$161,000.
$69,000.
$220,000.
6) Webster Corporation's budgeted sales for February are $323,000. Webster pays sales representatives a commission of 6% of sales dollars. The company pays a sales manager a monthly salary of $4,200 and expects advertising expense of $1,800 per month. Compute the total selling expenses to be reported on the selling expense budget for the month of February.
$25,380.
$19,380.
$6,000.
$23,580.
$21,180.
7) Junior Snacks reports the following information from its sales budget:
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Expected Sales:
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October
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$148,000
|
| |
November
|
156,000
|
| |
December
|
192,000
|
All sales are on credit and are expected to be collected 35% in the month of sale and 65% in the month following sale. The total amount of cash expected to be received from customers in November is:
$150,800.
$96,200.
$156,000.
$252,200.
$54,600.
8) Calgary Industries is preparing a budgeted income statement for 2015 and has accumulated the following information. Predicted sales for the year are $735,000 and cost of goods sold is 40% of sales. The expected selling expenses are $81,500 and the expected general and administrative expenses are $90,500, which includes $23,500 of depreciation. The companies income tax rate is 30%. The budgeted net income for 2015 is:
$441,000.
$188,300.
$269,000.
$84,800.
$80,700.
9) Flagstaff Company has budgeted production units for July of 8,100 units. Variable factory overhead is $1.3 per unit. Budgeted fixed factory overhead is $20,000, which includes $3,200 of factory equipment depreciation. Compute the total budgeted overhead to be reported on the factory overhead budget for the month.
$27,330.
$20,000.
$24,900.
$30,530.
$10,530.
10) Zhang Industries sells a product for $710. Unit sales for May were 500 and each month's sales are expected to exceed the prior month's results by 2%. Compute the total sales dollars to be reported on the sales budget for month ended June 30.
$353,500.
$355,000.
$362,100.
$347,900.
$426,000.
11) The standard materials cost to produce 1 unit of Product R is 6 pounds of material at a standard price of $50 per pound. In manufacturing 7,000 units, 41,000 pounds of material were used at a cost of $51 per pound. What is the total direct materials cost variance?
$42,000 unfavorable.
$51,000 unfavorable.
$9,000 unfavorable.
$51,000 favorable.
$9,000 favorable.
12) Summerlin Company budgeted 5,200 pounds of material costing $4.00 per pound to produce 2,000 units. The company actually used 5,700 pounds that cost $4.10 per pound to produce 2,000 units. What is the direct materials quantity variance?
$2,000 unfavorable.
$520 unfavorable.
$570 unfavorable.
$2,050 unfavorable.
$2,570 unfavorable.
13) Fletcher Company collected the following data regarding production of one of its products. Compute the direct materials quantity variance.
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Direct materials standard (6 lbs. @ $2/lb.)
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$12 per finished unit
|
|
Actual direct materials used
|
285,350 lbs.
|
|
Actual finished units produced
|
47,000 units
|
|
Actual cost of direct materials used
|
$568,200
|
$2,500 unfavorable.
$4,200 unfavorable.
$2,500 favorable.
$6,700 unfavorable.
$4,200 favorable.
14) Claremont Company specializes in selling refurbished copiers. During the month, the company sold 175 copiers at an average price of $2,900 each. The budget for the month was to sell 170 copiers at an average price of $3,100. The expected total sales for 175 copiers were.
$507,500.
$542,500.
$493,000.
$527,000.
$549,000.
15) The following information describes a company's usage of direct labor in a recent period. The direct labor rate variance is:
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Actual hours used
|
41,000
|
|
Actual rate per hour
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$ 14.00
|
|
Standard rate per hour
|
$ 13.00
|
|
Standard hours for units produced
|
43,000
|
$41,000 unfavorable.
$26,000 favorable.
$15,000 unfavorable.
$41,000 favorable.
$26,000 unfavorable.
16) Fletcher Company collected the following data regarding production of one of its products. Compute the direct materials price variance.
|
Direct materials standard (6 lbs. @ $2/lb.)
|
$12 per finished unit
|
|
Actual direct materials used
|
267,200 lbs.
|
|
Actual finished units produced
|
44,000 units
|
|
Actual cost of direct materials used
|
$531,930
|
$2,470 unfavorable.
$3,930 unfavorable.
$2,470 favorable.
$6,400 unfavorable.
$3,930 favorable.
17) The following is a partially completed lower section of a departmental expense allocation spreadsheet for Brickland. It reports the total amounts of direct and indirect expenses for the four departments. Purchasing department expenses are allocated to the operating departments on the basis of purchase orders. Maintenance department expenses are allocated based on square footage.
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Purchasing
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Maintenance
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Fabrication
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Assembly
|
|
Operating costs
|
$37,000
|
$21,000
|
$101,000
|
$67,000
|
|
No. of purchase orders
|
|
|
14
|
6
|
|
Sq.ft. of space
|
|
|
3,550
|
2,450
|
Required:
Compute the amount of Purchasing department expense to be allocated to Assembly.
$16,650.
$11,100.
$25,900.
$8,575.
$12,425.