6) Assume the following facts for two products, Zip and Zap:

Zip Zap Sales mix 3 units 1 unit Selling price per unit S21.00 $28.00 $14.00 $16.00

If total fixed costs are $132,000, the break-even point in units would be

A) 1,200 units of Zip and 400 units of Zap B) 4,000 units of Zip and 12,000 units of Zap C) 12,000 units of Zip and 4,000 units of Zap D) 8,400 units of Zip and 2,800 units of Zap

7) Which statement is FALSE?

A) If the sales-mix of products sold changes, the break-even point does not change. B) Each different sales-mix of products has a different break-even point. C) Changes in the sales-mix of products sold affects a company's net operating profit. D) Changes in the sales-mix of products sold affects a company's contribution margin.

In a merchandising firm, the computation of Cost of Goods Sold does NOT use

A) Merchandise Inventory, ending balance B) Merchandise Inventory, beginning balance C) purchases of merchandise inventory D) purchases of raw materials

19) A company identifies the following goals and objectives:

Increase sales 10 percent each year. Increase profits 5 percent each year. Increase total plant assets 5 percent each year.

Which of the following budgets identifies the overall goals and objectives of an organization?

A) strategic plan B) sales budget C) financial planning model D) master budget

20) A manager has several forecasts of sales corresponding to different levels of advertising. The

manager decides to implement $1 million of advertising in the next fiscal year. At this level of

advertising, the manager uses the in the

A) sales goal; sales forecast B) sales forecast; sales budget C) sales budget; sales forecast D) sales forecast; sales goal

21) Important factors used to forecast sales for a company include all of the following items EXCEPT

A) layout of production equipment B) changes in product mix C) general economic conditions D) changes in firm's prices

24) The budget focuses on the budgeted income statement and the supporting schedules.

A) operating B) purchases and cost of goods sold C) financial D) operating expense

25) Which of the following is NOT a component of the operating budget?

A) capital budget B) budgeted income statement

C) operating expense budget D) sales budget

32) When should a company use an activity-based flexible budget with multiple cost drivers instead of

a simple flexible budget with one cost driver?

A) when a significant portion of costs vary with the number of units of sales B) when a significant portion of costs vary with cost drivers other than units of output C) when a significant portion of costs vary with only one cost driver D) when a significant portion of costs vary with the number of units of output

33) Huntsman Company's variable selling and administrative expenses are $48,000 at a production level of 6,000 units. If the production level is 8,000 units, what are the variable selling administrative expenses?

A) $64,000 B) $56,000 C) $80,000 ) $48,000

34) Perez Company had the following information available:

Expected Costs and Selling Price Based on 5,000 Units:

Variable manufacturing costs per unit $32 Fixed manufacturing costs per unit $20 Selling price per unit $70

Expected production level 5,000 units

In the flexible budget at 15,000 units, what is the total manufacturing cost?

A) $580,000 B) $680,000 C) $480,000 D) $780,000

42) If the sales activity variance was $8,000 Favourable and the static budget variance was $10,000

Favourable, then the flexible budget variance was o

A) $18,000 Unfavourable B) $18,000 Favourable C) $2,000 Unfavourable D) $2,000 Favourable

43) One variance often influences another variance. If the direct materials price variance is favourable,

then it is possible that this variance will cause

A) the direct labor price variance to be favourable B) the direct labor price variance to be unfavourable C) the direct materials quantity variance to be favourable D) the direct materials quantity variance to be unfavourable

46) When a firm meets a sales goal, it is said to be ... When a firm incurs more direct material

costs to manufacture products than expected, the firm is said to be o

A) effective; ineffective B) efficient; inefficient C) efficient; ineffective D) effective; inefficient