Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

6. Roncy Manufacturing uses enhanced powder plastics (EPP) to manufacture a high-pressure board, Dura-Plastic. Information concerning its operation in June was as follows: Master Budget

6. Roncy Manufacturing uses enhanced powder plastics (EPP) to manufacture a high-pressure board, Dura-Plastic. Information concerning its operation in June was as follows:

Master Budget units of Dura-Plastic to manufacture

8,000

Units of Dura-Plastic actually manufactured

9,000

Budgeted amount of EPP to purchase

70,000

oz.

EPP material actually purchased

76,000

oz.

EPP material actually used in production

72,000

oz.

standard cost of EPP actually used in production

$478,800

standard quantity of EPP per unit of Dura-Plastic

7.5

oz.

Cost of EPP purchased

$574,560

The direct materials usage (efficiency) variance for June was:

Select one:

a. $13,300 unfavorable

b. $26,600 unfavorable

c. $29,925 unfavorable

d. $34,020 unfavorable

7. The term Six Sigma refers to:

Select one:

a. The control limits established in a Pareto-analysis chart.

b. A quality-performance standard that requires all products and services to meet the target value exactly, with no variation.

c. A business process-improvement approach that seeks to find and eliminate causes of defects and errors.

d. The quality expectation embodied in a robust-quality performance standard.

e. The quality requirement specified for ISO 9000 certification

8. A proper role for accounting in terms of managing and controlling quality is all of the followingexcept

Select one:

a. Providing management with relevant financial information for decisions related to quality-oriented initiatives

b. Providing management with relevant nonfinancial information for decisions related to quality-related initiatives

c. Specifying quality-related goals and objectives for the organization

d. Identifying operational constraints

e. Participating in the development of Six-Sigma quality-related goals

9. Which one of the following statements pertaining to the return on investment (ROI) as a divisional performance measure is incorrect?

Select one:

a. When the average age of assets differs substantially across divisions of a business the use of ROI may not be appropriate

b. ROI relies on financial measures that are capable of being independently verified while other forms of performance measures are subject to manipulation

c. The use of ROI may lead managers to reject capital investment projects that can be justified using discounted cash flow (DCF) models

d. The use of ROI can make it undesirable for a skillful manager to take on trouble-shooting assignments such as those involving turning around unprofitable divisions

e. The use of ROI can lead managers to emphasize the ROI of his/her division over the profitability of the organization as a whole

9. Assume that an organization's weighted-average cost of capital (minimum rate of return) is 8% and that Division A currently has a 12% return on investment (ROI). The manager of Department A, who is evaluated on the basis of divisional ROI, would most likely accept an investment that is expected to return:

Select one:

a. More than 8%

b. More than 12%

c. More than 8% but less than 12%

d. Less than 12%

e. Impossible to tell without further information

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing

Authors: Alan H. Millichamp

8th Edition

082645500X, 9780826455000

More Books

Students also viewed these Accounting questions

Question

Describe the major barriers to the use of positive reinforcement.

Answered: 1 week ago