1.

A granary allocates the cost of unprocessed wheat to the production of feed, flour, and starch. For the current period, unprocessed wheat was purchased for $250,000, and the following quantities of product and sales revenues were produced.

Product	Pounds		Price per Pound
Feed	100,000		$	0.90
Flour	50,000			2.20
Starch	20,000			1.00

How much of the $250,000 cost should be allocated to feed if the value basis is used? (Round your intermediate percentage to the nearest whole percent.)

Multiple Choice

• $0.

• $133,333.

• $250,000.

• $130,000.

• $102,500.

2.

Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of office expenses are allocated to the two departments using different allocation bases. The following information is available for the current period:

Office Expenses	Total				Allocation Basis
Salaries	$	50,000			Number of employees
Depreciation		34,000			Cost of goods sold
Advertising		68,000			Net sales

Item	Drilling			Grinding			Total
Number of employees		1,800			2,700			4,500
Net sales	$	388,000		$	582,000		$	970,000
Cost of goods sold	$	140,600		$	229,400		$	370,000

The amount of the total office expenses that should be allocated to Drilling for the current period is:

Multiple Choice

• $60,120.

• $90,600.

• $105,200.

• $152,000.

• $600,000.

3.

Use the following data to find the total direct labor cost variance if the company produced 3,500 units during the period.

Direct labor standard (4.00 hrs. @ $6.70/hr.)	$	26.80	per unit
Actual hours worked		12,300
Actual rate per hour	$	7.30

Multiple Choice

• $12,300 favorable.

• $8,400 favorable.

• $4,010 unfavorable.

• $8,400 unfavorable.

• $4,010 favorable.

4.

Aloan Co. provides the following sales forecast for the next three months:

	January		February		March
Sales units	2,100		3,200		4,100

The company wants to end each month with ending finished goods inventory equal to 10% of the next months sales. Finished goods inventory on December 31 is 210 units. The budgeted production units for January are:

Multiple Choice

• 2,100 units.

• 2,420 units.

• 21 units.

• 2,210 units.

• 1,990 units.

5.

Cahuilla Corporation predicts the following sales in units for the coming four months:

	April		May		June		July
Sales in Units	250		290		310		250

Each month's ending Finished Goods Inventory should be 30% of the next month's sales. March 31 Finished Goods inventory is 75 units. A finished unit requires 5 pounds of direct material B at a cost of $3.00 per pound. The March 31 Raw Materials Inventory has 210 pounds of B. Each month's ending Raw Materials Inventory should be 20% of the following month's production needs. The budgeted purchases of pounds of direct material B during May should be:

Multiple Choice

• 1,476 lbs.

• 296 lbs.

• 1,772 lbs.

• 292 lbs.

• 1,184 lbs.

6.

Junior Snacks reports the following information from its sales budget:

Expected Sales:	October	$	141,000
	November		149,000
	December		185,000

All sales are on credit and are expected to be collected 40% in the month of sale and 60% in the month following sale. The total amount of cash expected to be received from customers in November is:

Multiple Choice

• $144,200.

• $84,600.

• $149,000.

• $233,600.

• $59,600.

7.

Funcycle Manufacturing's budget includes the following credit sales for the current year: September, $162,000; October, $153,000; November, $137,000; December, $174,000. Experience has shown that payment for the credit sales is received as follows: 15% in the month of sale, 55% in the first month after sale, and 30% in the second month after sale. What are the cash collections of credit sales in the month of December?

Multiple Choice

• $26,100.

• $121,250.

• $101,450.

• $174,000.

• $147,350.