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1) The Golden Appliance Manufacturing Corporation manufactures two vacuum cleaners, the Standard and the Super. The following information was gathered about the two products: Standard

1) The Golden Appliance Manufacturing Corporation manufactures two vacuum cleaners, the Standard and the Super. The following information was gathered about the two products:

Standard Super
Budgeted sales in units 3,200 800
Budgeted selling price $600 $1,700
Budgeted contribution margin per unit $420 $1,100
Actual sales in units 3,500 1,500
Actual selling price $650 $1,680
Actual contribution margin per unit $450 $990

What is the total sales-volume variance in terms of the contribution margin?

a.$216,000 unfavourable

b.$556,000 favourable

c.$896,000 favourable

d.$216,000 favourable

2)Safe Carriage Ltd. manufactures baby carriages. The company has two divisions, Wheels and Assembly. Because of different accounting methods and inflation rates, the company is considering multiple evaluation measures. The following information is provided for the year just ended:

ASSETS INCOME
Book value Current value Book value Current value
Wheels $485,000 $550,000 $120,000 $160,000
Assembly $750,000 $1,200,000 $160,000 $172,500

The company is currently using a 12% required rate of return. What are Wheels' and Assembly's return on investment based on current values, respectively?

a.0.14; 0.29

b.0.21; 0.25

c.0.25; 0.21

d.0.33; 0.23

e.0.29; 0.14

3)The Monkey Division of Jungle Corp. produces and sells a product to outside and internal customers.

The following information is on a per-unit basis, based on current operations:

  • External sales price $640
  • Direct materials 105
  • Direct labour 250
  • Fixed overhead 180

If Monkey has excess capacity available to meet an internal order, what is the minimum transfer price at which they'd be willing to sell their product?

a.

$640

b.

$625

c.

$355

d.

$430

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