6. Train Company had no beginning inventory and adds all materials at the very beginning of its only process. Assume 120,000 units were started, and 80% complete at months end. Total costs were $36,000 for material and $24,000 for conversion. The cost per equivalent unit of conversion is ________.

None of these

$.25

$.30

$.20

$.40

7. Train Company had no beginning inventory and adds all materials at the very beginning of its only process. Assume 10,000 units were started, and 5,000 units completed. Ending work in process is 60% complete. The cost per equivalent unit of conversion is _______.

$1.00 if total conversion cost is $10,000

$1.25 if total conversion cost is $10,000

$1.00 if total conversion cost is $5,000

$1.00 if total conversion cost is $3,000

None of these

8. Train Company makes units, and each unit requires 3 pounds of material at $4 per pound. 500 and 700 units will be built in May and June, respectively. Train keeps material on hand at 20% of the next months production needs. How much is the total materials cost for May?

$7,680

$8,400

$14,400

None of these

$6,000

9. Anticipated unit sales for January are 5,100; sales for February are 4,400; and sales for March are 8,200. Finished goods are consistently maintained at 80% of the following months sales. If units cost $10 each to produce, how much is Februarys total cost of production?

$72,000

$0

None of these

$44,000

$74,000

10. Total production of 1,000 units of finished goods required 3,910 actual hours at $12.50 per hour. The standard is 4 hours per unit of finished goods, at a standard rate of $11.50 per hour. Which of the following statements is true?

The total labor variance is $2,750 unfavorable

The labor rate variance is $3,910 unfavorable.

The total labor variance is $2,875 favorable.

None of these

The labor efficiency variance is $1,035 unfavorable

11. If beginning work in progress was 700 units, 1,500 additional units were put into production, and ending work in process was 600 units, how many units were completed?

2,200

900

2,800

1,600

None of these

12. Train Company had no beginning inventory and adds all materials at the very beginning of its only process. Assume 10,000 units were started, and 5,000 units completed. Ending work in process is 60% complete. The cost per equivalent unit of material is _____.

$1.00 if total material cost is $10,000

None of these

$1.00 if total material cost is $5,000

$1.00 if total material cost is $3,000

$1.00 if total material cost is $8,000

13. Assume that actual overhead consisted of $30,000 for indirect labor, $20,000 for indirect material, and $10,000 for depreciation of factory equipment. Based on the preset rates, $65,000 of overhead was applied to work in process. Which of the following statements is true?

Overhead is underapplied

This is viewed as an unfavorable situation

There will be a $5,000 debit balance in Factory Overhead

All of these

None of these

14. The contract interest rate for bonds ______.

None of these.

Has no relation to the cash flow associated with a particular bond.

Is less than the effective interest rate when bonds are issued at a premium

Will fluctuate over the life of a bond

Must equal the effective interest rate

15. Train corporation issued $100,000 of 7%, 15-year bonds on April 1, 2017 at 102.5 interest is paid on April 1 and October 1. The proper entry to record issuance of the bonds includes a debit to Cash for _____.

$100,000

$101,000

$101,167

$107,000

$102,500

16. Which of the following statements about treasury stock is true?

Losses on treasury stock transactions are recorded in income.

Purchasing treasury stock causes stockholders equity to increase.

Gains are not recorded on treasury stock transactions but losses are.

Excess of the sales price over cost should be credited to retained earnings.

Purchasing treasury stock requires a debit to the treasury stock account.

17. Train Company has 100,000 shares of common stock outstanding. On april 15, the board declared a $.30 dividend to be paid to stockholders of record on May 4. The dividend was distributed on May 15. The proper journal entry for Train Company on May 15 does not include ______.

A debit to Dividends Payable for $30,000

A credit to Cash for $30,000

None of these

Both a debit to Dividends Payable for $30,000 and a credit to Cash for $30,000

A debit to Dividends for $30,000

18. In an effort to concentrate its resources in more profitable areas, Train Corporation recently sold its family cookbook segment but retained its restaurant segment. The disposal constitutes _______.

None of these

A discontinued operation, which should not be disclosed net-of-tax effects

An item which does not require disclosure

An extraordinary item

A discontinued operation, which should be treated as a prior period adjustment

19. Train Corporation has 100,000, 5%, $100 par preferred shares outstanding. The preferred stock was originally issued at 102. The current dividend has been fully paid. Total stockholders stock equity is $25,000,000. The common stock equity is _____.

$14,800,000

$15,000,000

$9,800,000

$25,000,000

None of these

20. Train Companys balance sheet included cash of $4,200,000, accounts receivable of $16,000,000 inventories of $10,000,000, prepaid expenses of $2,000,000, accounts payable of $9,000,000, and accrued expenses of $7,000,000. Working capital is ______.

$7,000,000

None of these

$16,000,000

$20,000,000

$4,000,000

21. Selected information for 2017 is:

Cost of goods sold, $6,000,000

2016 ending inventory, $2,000,000

2017 ending inventory, $1,400,000

Net sales, $7,200,000

2016 ending receivables $990,000

2017 ending receivables, $930,000

Net income, $720,000.

Assuming a 360-day year, what was the inventory turnover ratio for 2017?

102

None of these

4.3

7.5

3.5

22. On the schedule of cost of goods manufactured:

None of these

Factory overhead plus beginning work-in-progress equals manufacturing costs

Beginning work-in-process plus direct materials used equals manufacturing costs increase

Ending work-in-process will necessarily increase if total manufacturing costs increase

Cost of goods manufactured equals value of total manufactured equals value of total manufacturing costs

23. Which costing method seems ideally suited to the production of homogenous products in continuous throughout?

Absorption costing

None of these

Process costing

Job order costing

Activity-based costing

24. Train Company uses a job order cost system and applies overhead based on estimated rates for work in their factory. The overhead application rate is based on total estimated overhead costs of $200,000 and direct labor hours of 50,000. For job 836, direct labor hours were 810 for the month of December. What is the appropriate journal entry for job 836 for the month of December?

Job overhead expense should be credited for $200.

None of these

Factory overhead should be credited for $3,240

Factory overhead should be credited for $3,200

Job overhead expense should be debited for $200

25. For job 1838, there were 1,000 direct labor hours, and actual overhead was $500 for depreciation and $1,400 for indirect labor. Overhead is applied at $2 per direct labor hour. Which account should be debited for $1,900?

Work in process

Factory overhead

None of these

Cost of goods manufactured

Cost of goods sold