having trouble with accounting
39. Budgets are prepared by management in a manner to make certain that they are challenging but attainable as well as accepting of budgetary slack. TRUE FALSE 40. The sequence of budgets within the master budget is dictated by US GAAP. TRUE FALSE Answer Questions 141 and 42 using the information below: Given: Below is a Production Budget for the first Quarter of a company's fiscal year that includes forecasted monthly unit sales. Additionally, management wishes to have 30% of the following month's unit sales as Desired Ending Inventory. Q2 April 22,000 May 28,000 June 26,000 July 24,000 Unit Sales Desired Ending Inventory Total Required Units Beginning Inventory No. of units to be produced 6.600l I T me a 41. The Desired Ending Inventory for May is: A. 6,600 B. 7,200 C. 7,800 D. 8,400 42. The Desired Ending Inventory for the second Quarter or Q2 is: A. 6,600 B. 7,200 C. 7,800 D. 8,400 43. Other names for the Flexible Budget include Fixed, Static, and Master Budgets TRUE FALSE 44. In performing Variance Analysis for Fixed Overhead costs, the variances are called Spending and Efficiency Variances. TRUE FALSE 45. A Favorable Direct Materials Price Variance could be due to the purchasing manager buying large amounts of direct material at a bargain price. TRUE FALSE ANSWER QUESTIONS #48 and #49 using the below Given information. The Finest Overcoat Company makes overcoats. During January company management noted it used 18,500 hours of direct labor at a cost of $337,625 to produce 12,000 overcoats. Standards: 1.5 hours of direct labor per unit at $18 per hour wage rate. 48. The Standard Cost per unit of output for Direct Labor is $30.00 TRUE FALSE 49. The Direct Labor Rate Variance is: A. $4,625 Favorable B. $9,000 Favorable C. $4,625 Unfavorable D. $9,000 Unfavorable 50. Fixed Overhead costs are based on long-range planning that involve levels of capacity. TRUE FALSE 51. All of the following are true about Capital Budgeting EXCEPT: A. It is the process of analyzing alternative long-term investments and deciding which to purchase B. Capital Budgeting is risky due to uncertain outcomes C. Capital Budgeting involves large amounts of money D. Capital Budgeting decisions are usually easily reversed without significant consequences 52. The Payback Method, Accounting Rate of Return, and the Profitability Index all involve Time Value of Money (TVM). TRUE FALSE 53. The Internal Rate of Return (IRR) is the interest rate whereby NPV equals zero TRUE FALSE 54. Management would consider accepting a project or investment if its IRR is less than the project's or investment's Required Rate of Return (RRR). TRUE FALSE 55. The process of restating future cash flows in today's dollars is known as A. Discounting B. Compounding C. Annualizing D. Capitalizing 29. A company with a high degree of Operating Leverage will have a higher amount of their costs as Fixed Costs compared to a lower degree of Operating Leverage. TRUE FALSE 30. In Cost-Volume-Profit (CVP) Analysis, the assumption is that Total Costs are separated into Product costs and Period costs. TRUE FALSE ANSWER THE QUESTIONS #31, 32, and #33 USING THE INFORMATION BELOW: Projected Sales: 25,000 Average Sales Price per unit: $ 45.00 Average Variable Cost per unit: S 30.00 Total Fixed Costs: $ 250,000 31. Operating Income is: A. A loss B. Profit in the amount of $125,000 C. Profit in the amount of $375,000 D. Profit in the amount of $625,000 32. Break-even in unitis is: A. 8,334 B. 16,667 C. 25,000 E. Not enough information given 33. Contribution Margin Ratio is: A. 33% B. 50% C. 67% D. Not enough information given B. Heterogeneity C. Mass production D. Diversity of products produced 22. At the beginning of the year, a company predicts total overhead costs in the amount of $540,000. The company applies overhead using machine-hours and estimates it will use 2,400 machine-hours during the year. What amount of overhead should be applied to Job 25 if that job uses 40 machine-hours during February? A. $9,000 B. $13,500 C. $22,500 D. $96,000 23. A company's Factory or Manufacturing overhead T-account at the end of its fiscal year shows Actual Overhead in the amount of $600,000 and Applied or Allocated Overhead in the amount of $650,000. Which of the following is true in describing this accounting scenario? A. Overhead is over-applied by $50,000 and the journal entry to close out MOH would require debiting Cost of Goods Sold (COGS) B. Overhead is over-applied by $50,000 and the journal entry to close out MOH would require crediting Cost of Goods Sold (COGS) C. Overhead is under-applied by $50,000 and the journal entry to close out MOH would require debiting Cost of Goods Sold (COGS) D. Overhead is under-applied by $50,000 and the journal entry to closes out MOH would require crediting Cost of Goods Sold (COGS) 24. Total variable costs change in proportion to changes in volume of activity. TRUE FALSE ANSWER THE FOLLOWING QUESTION #56 BASED ON THE FOLLOWING GIVEN INFORMATION: Given: Below is information on an investment considered by the Williams Company. The investment has zero salvage value. The company requires an 9% return from its investments. Initial Investment: Expected Cash in-flow Year 1: Expected Cash in-flow Year 2: Expected Cash in-flow Year 3: $ 500,000 $ 200,000 $ 225,000 $ 245,000 Present Value Factor of 1 at 9%: n=1: 0.91743 n=2: 0.84168 na3: 0.77218 56. Choose from one of the following that accurately depicts the decision: A. This investment should be considered because NPV equals $562,048. B. This investment should be considered because NPV equals $62,048. C. This investment should not be considered because the Profitability Index is 1.124. D. B and C above 57. Relevant Costs are also known as Avoidable Costs. TRUE FALSE 58. Sunk Costs are each of the following except: A. Unavoidable costs B. Historical costs C. Irrelevant costs D. Avoidable costs 59. An Opportunity cost is the contribution to operating income that is forgone by not using a limited resource in its next best alternative and can be a significant consideration in Make-or-Buy decision making. TRUE FALSE 60. All of the following are Responsibility Centers except: A. Cost Center B. Process Center C. Profit Center D. Revenue Center 61. A unit of business that generates revenues and incurs costs is called a[n): A. Responsibility Center B. Expense Center C. Profit Center D. Cost Center 62. The Balanced Scorecard is a system of measures providing a framework for a company to implement its strategy. Identfly which of the following is not one of the Perspectives: A. Customer B. Performance C. Internal Business D. Innovation/Learning 63. Customer Response Time includes Manufacturing Cycle Time. Manufacturing Time (or Process Time) is ordinarily non-value-added time in regard to the customer. TRUE FALSE TRUC TALIC 12. Conversion costs consist of both Direct Materials and Direct Labor. TRUE FALSE 13. Current Assets for a manufacturer include: A. Accounts receivable, Merchandise inventory, Raw materials B. Accounts receivable, Work-in-Process Inventory, Finished Goods inventory C. Accounts receivable, Merchandise inventory, Work-in-Process inventory D. Both B and C 14. For the Fiscal (Calendar) Year ending 12/31/2019, Ending Inventory of work-in-process is subtracted to "Total Manufacturing Costs to Account for" in determining Cost of Goods Manufactured. TRUE FALSE 15. Product costs include all of the following except: A. Plant overhead costs such as depreciation of the plant equipment B. Research & Development Costs C. Direct Labor costs D. Direct Materials 16. The two basic types of cost accounting systems are job order costing and periodic costine TRUE FALSE 17. A company that produces a large number of standardized units would use a process costing system
