I need very detailed work to solve these problems on the 2 attached test

Practice Exam 2-A These practice questions do not cover every topic that may appear on the actual exam, but they should be a part of your exam preparation. You should also study your class notes, assignments, practice problems as well as the assigned reading from the textbook. Time value of money tables will be provided on the exam. 01. Which department is often responsible for a direct materials variance based on usage? A. The accounting department B. The production department C. The purchasing department D. The budgeting department 02. Capital budgeting decisions can be difficult because A. Decision may be difficult or impossible to reverse. B. Large amounts of money are usually involved. C. Investment involves a long-term commitment D. Outcome is uncertain. E. All of the above. 03. Which of the following accounts is closed at the end of the year? A. Cash B. Revenue C. Retained earnings D. Accounts payable 04. When a company receives a utility bill that is not due until next month, it should A.debit utilities expense and credit accounts payable. B.debit utilities expense and credit accounts receivable. C.debit accounts payable and credit utilities expense. D.debit utilities expense and credit cash E.make no entry until the bill is paid. 05. How long will it take an investment of $25,000 to accumulate to a total of $35,462.50 assuming an interest rate of 6 percent? A. 4 years. B. 10 years. C. 5 years. D. 6 years. E. 2 years. 06. Cobert Company's actual sales results exceeded the planned results for July. This amount exceeded the amount of an unfavorable difference reported for June sales. Which of the following statements about the sales performance report for both months is true? A. The sales report is not useful since it shows a favorable and unfavorable difference for the two months. B. The differences for the two months will offset each other so the differences should not be a concern. C. The difference for July can be ignored. D. The differences for both months should be investigated if the amounts are significant. 07. Which of the following statements is true? A. A flexible budget expresses all costs on a per unit basis. B. Sales variances may be computed in a manner similar to cost variances and can be caused by a difference from planned prices or volume. C. The final budget amounts in a performance report are based on an expected level of sales or production. D. If an actual amount is more than a budgeted amount, an unfavorable variance will always result. -- Practice Exam 2-A Page 1 of 7 -- 08. When deciding whether to replace some equipment, the purchase price of the new equipment is A. a relevant cost. B. a semi-relevant cost. C. a sunk cost. D. none of the above 09. The Ooey Gooey Candy Company produces chocolate frosted sugar bombs that are used in one of the company's products. For the production of the component, the company incurs direct material costs of $2,000, direct labor costs of $1,000, variable overhead costs of $4,000 and fixed overhead costs of $3,000. If the company purchases the component from an outside supplier, $2,000 of the fixed costs can be eliminated. At what purchase price is the company indifferent between making or buying? A. 8,000 B. 10,000 C. 7,000 D. 9,000 E. 6,000 A. B. C. D. 10. Debits increase both assets and liabilities. decrease both assets and liabilities. increase assets and decrease liabilities. decrease assets and increase liabilities. 11. Leonard Matson completed these transactions during December of the current year: 1 Began company by investing $20,000 3 Purchased $5,000 of office equipment 6 Purchased $300 of supplies on account 10 Completed work for a client; received $900 15 Completed work for Acme Company; sent a bill for $1,700 17 Paid for supplies purchased earlier 22 Received payment in full from Acme Company. Based on the transactions above, what are the company's total assets? A. 22,600 B. 25,900 C. 24,300 D. 27,600 12. The purpose of the ledger is to A.record chronologically the day's transactions. B.keep a record of documentation to support each transaction. C.keep in one place all information about changes in specific account balances. D.make sure that all assets, liabilities, etc., have normal balances at all times. 13. Transmogrifier Transportation, Inc. purchased a new vehicle by obtaining a loan. The company agreed to the following terms: -- Practice Exam 2-A Page 2 of 7 -- Annual Payment Rate Term of loan (in years) 8,000 6% 5 What is the total amount of interest that the company will pay on the loan? A. 5,907 B. 2,201 C. 6,301 D. 2,400 14. Which of the following interest rates will produce the smallest present value? A. 10% B. 5% C. 4% D. 2% 15. If you are able to earn a 10% rate of return, what amount would you need to invest to have $500 two years from now? A. 1,050 B. 868 C. 413 D. 455 E. 605 16. Carl's Camera Company received a special one-time order for 1,500 instant cameras at $5 per unit. Carl currently produces and sells 7,500 units at $6 each which represents 85% of its capacity. Production costs for the regular units include $3 variable cost per unit and total fixed costs of $10,000. To produce the special order, the company would have to pay $1,000 in delivery costs. Should the company accept the special order? A. Yes, because incremental revenue exceeds incremental costs. B. Yes, because incremental costs exceed incremental revenues. C. No, because the incremental revenue is too low. D. No, because incremental costs exceed incremental revenue. E. No, because additional production would exceed capacity. 17. Derkins, Inc. is considering a capital investment project. The company estimates that the project will generate $50,000 per year for 4 years at which time it can be sold for $10,000. If the company uses a 6% interest rate, how much should the company be willing to pay for the investment? A. 183,255 B. 181,176 C. 173,255 D. 210,000 E. 200,000 18. Calvin plans to retire from his job and to help his retirement, he intends to contribute $20,000 per year for the next ten 10 years to an investment account. Assuming his account will earn 4% interest, how much will be in his retirement fund when he leaves his job? A. 13,511 B. 162,218 C. 29,605 D. 240,122 -- Practice Exam 2-A Page 3 of 7 -- 19. Bartels Corporation produces wooded picture frames. It takes 2 hours of direct labor to produce a frame. Bartels' standard labor cost is $12 per hour. During August, Bartels produced 10,000 frames and used 21,040 hours of direct labor at a total cost of $250,376. What is Bartels' labor efficiency (i.e. quantity) variance for August? A. $10,376 unfavorable. B. $12,480 unfavorable. C. $2,104 favorable. D. $12,480 favorable. E. $14,584 unfavorable. 20. Which of the following journal entries is recorded correctly? A. Rent expense Rent revenue 50 B. Equipment Cash 50 C. Rent revenue Cash 50 D. Capital Revenue 75 E. Accounts payable Cash 50 50 50 75 150 50 21. The Stewart Company sells coffee cups for $10 per unit. Based on a 10,000-unit production level, variable costs total $60,000 and fixed costs total $30,000. If the company produced and sold 12,500 units, what is its budgeted net income? A. 10,000 B. 20,000 C. 30,000 D. 35,000 A. B. C. D. 22. If a company were considering whether or not to accept a special order, nonfinancial information that management might evaluate would include all of the following except ability to meet customer's schedule for delivery availability of raw materials needed to produce order availability of workers amount of overtime pay for workers 23. The accounting records of the Kimmel Company showed the following: Balance of the equipment account on Jan. 1 1,400 -- Practice Exam 2-A Page 4 of 7 -- Balance of the equipment account on Dec. 31 1,800 Amount of equipment sold during the year 900 What amount of equipment was purchased during the year? A. 400 B. 500 C. 900 D. 1,300 24. You recently purchased a new house by obtaining a loan; the terms of loan included annual payments of $16,000 for 30 years. If the interest rate on your loan is 8% what is the purchase price of your home? A. 180,125 B. 480,000 C. 47,701 D. 161,003 25. In a flexible budget report, actual fixed costs A. cannot be different from budgeted fixed costs. B. should not be different from budgeted fixed costs. C. should be different from budgeted fixed costs. D. should not appear in the budget report. 26. Accrual accounting requires a company recognize A. revenues as they occur. B. revenues when the related cash is received. C. expenses when the related cash is paid. D. Both B and C E. None of the above 27. The Garza Company purchased a copy machine for $2,400 and expects it to be useful for 4 years at which time it can be sold for $200. What amount of depreciation expense would the company record? A. 650 B. 550 C. 600 D. 50 28. The Murphy Company had supplies on hand of $500 at the beginning of the period, purchased $300 of supplies during the period and had $200 worth of supplies on hand at the end of the period. The related adjusting entry at the end of the period would record supplies expense of A. $500 B. $300 C. $600 D. $200 E. none of the above 29. Bartels Corp. produces woodcarvings. It takes 2 hours of direct labor to produce a carving. Bartels' standard labor cost is $12 per hour. During August, Bartels produced 10,000 carvings and used 21,040 hours of direct labor at a total cost of $250,376. What is Bartels' labor rate (i.e. cost) variance for August? A. $2,000 favorable. B. $2,104 unfavorable. C. $2,104 favorable. -- Practice Exam 2-A Page 5 of 7 -- D. $4,160 favorable. E. $2,000 unfavorable. 30. A manager of a company had budgeted to produce 150 units, costing $1,500 in variable costs and $600 in fixed costs. The actual production was 200 units costing $1,900 in variable costs and $600 in fixed costs. Overall, the manager can be said to have performed: A. Above expectations B. Below expectations C. As expected D. Cannot be determined -- Practice Exam 2-A Page 6 of 7 -- Practice Exam 2-A Answer Key Questio n 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Answer B E B A D D B A D C A C C A C E B D B B B D D A B A B C C A -- Practice Exam 2-A Page 7 of 7 -- Practice Exam 2-B These practice questions do not cover every topic that may appear on the actual exam, but they should be a part of your exam preparation. You should also study your class notes, assignments, practice problems as well as the assigned reading from the textbook. Time value of money tables will be provided on the exam. 01. Depreciation expense is necessary to A. allocate the cost of an asset over its useful life. B. show the asset at its market value on the balance sheet. C. keep track of an asset's useful life in years. D. record how often an asset is actually used. 02. Closing entries are needed because A. assets, liabilities and equity accounts should \"start over\" at zero at the beginning of each year. B. revenues and expenses should \"start over\" at zero at the beginning of each year. C. all accounts should \"start over\" at zero at the beginning of each year. D. certain accounts are no longer needed and should be \"shut down\" E. the cash account must be closed and counted at year-end. 03. After amounts are entered into the journal, they are then used to prepare the A. transactions B. ledger accounts C. financial statements D. journal entries 04. The J. Pinkman Company borrowed $20,000 at an interest rate of 8% to purchase some equipment and will make annual payments on the loan. If the term of the loan is 4 years, what is the total amount of interest that the company will pay on the loan? A. 2,246 B. 4,154 C. 24,154 D. 6,400 E. 5,300 05. For a capital budgeting decision, how many of the following would be included in the incremental operating cash flows? Initial investment Repairs and maintenance Cash from customers Terminal cash flow A. 0 B. 1 C. 2 D. 3 E. 4 06. If you deposited $1,500 into a savings account that paid 4% interest how much would be in the account in 3 years, if you never made any additional deposits or withdrawals? A. 5,445 B. 1,334 C. 1,680 -- Practice Exam 2-B Page 1 of 10 -- D. 1,687 E. 4,682 -- Practice Exam 2-B Page 2 of 10 -- 07. A production manager at the Salamanca Company was originally budgeted to have total variable costs of $40,000 and fixed costs of $5,500 based on unit sales of 1,000. The manager's actual results were total variable costs of $59,000 and fixed costs of $6,000 based on unit sales of 1,500. Overall this manager performed A. as expected B. below expectations C. above expectations D. cannot be determined 08. If capacity had to be expanded in order to accept a special order then the A. order must be rejected. B. cost to expand capacity should be considered. C. cost to expand capacity can be ignored. D. special order sales price should be lowered. 09. Credits: A. Increase both assets and liabilities B. Increase assets and decrease liabilities C. Decrease both assets and liabilities D. Decrease assets and increase liabilities 10. The Margolis Corporation, an online public relations firm, already offers its two hundred employees free internet access for home use provided by Mega-Comm. The following total costs are related to the contract between the two companies (a) initial total membership fee $500 (b) total monthly service charge $9,100 and (c) early contract cancellation fee $2,500. The company is considering switching to another provider, Magno-ISP, which would simply charge $45 per employee per month with no contract. The company intends to offer its employees this benefit for the next two years. Ignoring time value of money, what is the relevant cost related to switching to Magno-ISP for this decision? A. 218,500 B. 221,400 C. 218,400 D. 218,900 E. 216,000 11. Which of the following accounts are not closed at year-end? A. Retained Earnings B. Revenues C. Expenses D. All of the above E. Both B and C 12. Which of the following interest rates will produce the largest present value? A. 10% B. 5% C. 4% D. 12% E. unable to determine without more information 13. Heisenberg Caf sells a variety of sandwiches and snacks. In a recent flexible budget performance report, there was a variance related to bread. All of the following may help explain that variance except: A. More sandwiches were sold than originally planned. B. Bread was purchased from a different supplier than the one normally used. -- Practice Exam 2-B Page 3 of 10 -- C. D. E. Several packages of bread were accidentally allowed to spoil. A crate of bread was stolen from the refrigerator. All of the above could help explain the variance -- Practice Exam 2-B Page 4 of 10 -- 14. The information below is available for Beneke Fabrication, Inc. Flexible Budget Actual Sales $30,000 $32,000 Selling expenses 3,500 4,000 What is the overall budget difference for Ted, the manager of sales? A. 1,000 U B. 1,500 U C. 1,500 F D. 2,000 F E. 5,000 F 15. The W. White Company purchased $400 of supplies during the month, had supplies on hand of $200 at the beginning of the month and had $100 worth of supplies on hand at the end of the month. The related adjusting entry at the end of the month would record supplies expense of A. 0 B. 100 C. 300 D. 400 E. 500 16. Right now you are 20 years old and you have decided that you want to have $2,000,000 in the bank when you turn 65 years old. How much must you deposit each year to reach your goal if your account pays interest of 4 percent? A. 16,525 B. 342,400 C. 96,525 D. 100,000 E. 605,147 17. Which of the following is not a component of a balanced scorecard? A. Customer Perspective B. Improvement Perspective C. Financial Perspective D. Learning and Growth Perspective E. Internal Process Perspective 18. The Fring Company is considering a project that will cost $15,000 and has estimated that it will generate the following cash inflows: Year 1 $6,000 Year 2 3,000 Year 3 3,000 Year 4 4,000 Assuming an interest rate of 6%, what is the net present value of this project rounded to the nearest dollar? A. 13,449 B. -1,303 C. -1,551 D. 13,697 E. None of the above 19. When deciding whether or not to accept a special order, which of the following questions are relevant? -- Practice Exam 2-B Page 5 of 10 -- A. B. C. D. E. Does the company have excess manufacturing capacity? Can the special order be produced at a profit? How much does the company pay for its variable overhead costs? Both A and B All of the above questions are relevant -- Practice Exam 2-B Page 6 of 10 -- 20. In a game of Monopoly, Player A and Player B had the following properties: Player A Player B Boardwalk $400 New York Avenue $200 Pennsylvania Avenue $320 Illinois Avenue $240 If the players trade Pennsylvania Avenue for Illinois Avenue, Player A would have to record a: A. Debit to Gain on Sale for $80 B. Credit to Gain on Sale for $80 C. Debit to Loss on Sale for $80 D. Credit to Loss on Sale for $80 21. If the advertised Texas Lotto jackpot were $60,000,000 and instead of selecting 25 annual payments, you selected the cash value option, how much would you receive assuming an interest rate of 4 percent? A. 60,000,000 B. 6,398,007 C. 22,506,000 D. 37,493,040 E. 2,400,000 22. The Goodman Corporation completed the following transactions for the month: 1 Owners begin company by investing $50,000 4 Purchased $5,000 of office equipment 6 Purchased $20,000 of inventory on account 9 Sold $17,000 of the inventory to customers for $25,000 15 Paid for 25% of the inventory purchased on the 6th 20 Purchased another 10,000 of inventory on account 24 Sold $5,000 of the inventory to customers on account for $12,000 Based on the transactions above, what is the company's inventory balance at the end of the month? A. 8,000 B. 30,000 C. 13,000 D. 25,000 E. None of the above 23. The factory at Pollos Hermanos, Inc. is currently producing 120,000 units which is 80% of its capacity; what is the maximum number of units that could be produced? A. 96,000 B. 150,000 C. 72,000 D. 200,000 E. None of the above 24. The Boettticher Company is deciding whether to continue making a part or to just buy the part. In order to make the decision, the company has evaluated the costs associated with making the part as follows: Direct Labor $16,000, Fixed Overhead $10,000, Variable Overhead $20,000 and Direct Materials $10,000. The company can eliminate 50% of the fixed costs if it decides to purchase the part rather than make it. At what purchase price is the company indifferent between making or buying the part? A. 49,500 B. 53,500 C. 51,000 D. 56,000 E. 50,500 -- Practice Exam 2-B Page 7 of 10 -- 25. A flexible budget would not be needed for A. production costs B. sales C. variable costs D. fixed costs E. Both B and D 26. The accounting records of the Schader Company showed the following: Beginning accounts payable balance $2,000 Amount of purchases made on account during the year $5,000 Ending accounts payable balance $1,000 What was the amount paid toward accounts payable during the year? A. 5,000 B. 8,000 C. 4,000 D. 1,000 E. 6,000 27. Which of the following statements is true? A. Lower level employees should not have direct input into the development of their performance measures. B. Performance reports should include every cost that is related to the employee's job. C. Employees should be allowed to respond to every item on a performance report. D. A performance report should include only bad performance results. 28. Which of the following statements is false? A. An annuity is a series of unequal payments. B. Money grows in value over time. C. Present value can be found if the interest rate, the number of periods and the future value are known. D. Interest is the payment to the owner of an asset for its use by a borrower. 29. Tyson Corporation has collected the following data on one of its products: Direct materials standard (4 lbs. @ $1/lb.)...................... Total direct materials varianceunfavorable.................. Actual direct materials used............................................. Actual finished units produced......................................... A. B. C. D. E. $4 per finished unit $13,750 150,000 lbs. 30,000 units The direct materials price (i.e. cost) variance is: $13,750 unfavorable. $16,250 unfavorable. $16,250 favorable. $30,000 unfavorable. $33,000 favorable. 30. As compared to the original budget, fixed costs in a flexible budget A. usually change since the level of activity usually changes. B. should remain the same even if the level of activity changes. C. should never change unless the level of activity increases. D. will always remain the same unless a significant error has occurred. -- Practice Exam 2-B Page 8 of 10 -- -- Practice Exam 2-B Page 9 of 10 -- Practice Exam 2-B Answer Key Question 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Answer A B B B C D C B D A A C A C E A B E E C D A B C E E C A C B -- Practice Exam 2-B Page 10 of 10