Question
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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