Short-term creditors are typically most interested in assessing
B) operating results.
Cost of goods manufactured is equal to:
A) total manufacturing costs plus beginning work in process inventory less ending work in process inventory
B) total manufacturing costs plus ending materials inventory less beginning materials inventory
C) cost of goods sold beginning work in process inventory less ending work in process inventory
D) total manufacturing costs plus ending work in process inventory less beginning work in process inventory
Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four separate activity pools. The budgeted activity cost and activity base data by product are provided below.
Number of purchase orders
Number of production orders
Number of moves
Number of engineering changes
Number of Engineering
Determine the activity rate for procurement per purchase order.
16.The Kaumajet Factory produces two products - table lamps and desk lamps. It has two separate departments - finishing and production. The overhead budget for the finishing department is $550,000, using 500,000 direct labor hours. The overhead budget for the production department is $400,000 using 80,000 direct labor hours.
If the budget estimates that a table lamp will require 2 hours of finishing and 1 hours of production, how much factory overhead will be allocated to each unit of table lamps using the multiple production department factory overhead rate method with an allocation base of direct labor hours?
Which of the following statements is true regarding fixed and variable costs?
A) Variable costs are constant in total, and fixed costs vary in total.
B) Fixed costs are constant in total, and variable costs are constant per unit.
C) Both costs are constant when considered on a per unit basis.
D) Both costs are constant when considered on a total basis.
Gilbert’s expects its September sales to be 20% higher than its August sales of $150,000. Purchases were $100,000 in August and are expected to be $120,000 in September. All sales are on credit and are collected as follows: 30% in the month of the sale and 70% in the following month. Merchandise purchases are paid as follows: 25% in the month of purchase and 75% in the following month. The beginning cash balance on September 1 is $7,500. The ending balance on September 30 would be:
19.Nighthawk Inc. is considering disposing of a machine with a book value of $22,500 and an estimated remaining life of three years. The old machine can be sold for $6,250. A new machine with a purchase price of $68,750 is being considered as a replacement. It will have a useful life of three years and no residual value. It is estimated that the annual variable manufacturing costs will be reduced from $43,750 to $20,000 if the new machine is purchased. The net differential increase or decrease in cost for the entire three years for the new equipment is:
A) $2,925 decrease
B) $31,250 decrease
C) $8,750 increase
D) $8,750 decrease
If $1,000,000 of 8% bonds are issued at 105, the amount of cash received from the sale is
The Baffin Factory has determined that its budgeted factory overhead budget for the year is $7,750,000. They plan to produce 1,000,000 units. Budgeted direct labor hours are 500,000 and budgeted machine hours are 375,000. Using the single plantwide factory overhead rate based on direct labor hours, calculate the factory overhead rate for the year.
Which of the following is an example of direct labor cost for an airplane manufacturer?
A) Cost of oil lubricants for factory machinery
B) Cost of wages of assembly worker
C) Cost of jet engines
D) Salary of plant supervisor
If the price paid per unit differs from the standard price per unit for direct materials, the variance is termed a:
A) price variance
B) variable variance
C) controllable variance
D) volume variance
A company is contemplating investing in a new piece of manufacturing machinery. The amount to be invested is $150,000. The present value of the future cash flows is $145,000. Should they invest in this project?
A) no, because net present value is +$5,000
B) yes, because net present value is +$5,000
C) yes, because net present value is -$5,000
D) no, because net present value is -$5,000
Which of the following are the two main types of cost accounting systems for manufacturing operations?
A) Process cost and general accounting systems
B) Job order cost and process cost systems
C) Process cost and replacement cost systems
D) Job order and general accounting systems