QUESTION 6

Connor Company produces speaker systems for cars. Estimated sales (in units) in January are 40,000; in February 37,000; and in March 34,000. Each unit is priced at $60. Connor wants to have 35% of the following month's sales in ending inventory. That requirement was met on January 1.

Each speaker system requires 3 boxes and 15 yards of wire. Boxes cost $4 each and wire is $0.60 per yard. Connor wants to have 20% of the following month's production needs in ending raw materials inventory. On January 1, Connor had 24,000 boxes and 100,000 yards of wire in inventory. How many boxes does Connor expect to purchase in January?

a.159,650

b.114,420

c.214,550

d.148,500

e.138,420

QUESTION 7

Foray Company finds that typically 40% of a month's sales are for cash. Payments on accounts receivable are 70% in the month of sale and 28% in the month following sale. Budgeted sales for June are $120,000, for July $160,000, and for August $140,000. What are the total cash receipts budgeted for July?

a.$151,360

b.$85,400

c.$122,000

d.$262,000

e.$140,000

QUESTION 8

Anemone Company manufactures model airplanes. During the month, it manufactured 20,000 airplanes. Each one used an average of 8 direct labor hours and an average of 2 sheets of aluminum. It normally manufactures 8,000 airplanes. Materials and labor standards for making the airplanes are as follows:

Direct Materials (1 sheet of aluminum @ $12.00) $12.00

Direct Materials (other accessories @ $9) 9.00

Direct Labor (5 hours @ $5.00) 25.00

Compute the standard hours allowed for a volume of 20,000 airplanes.

a.100,000 hours

b.420,000 hours

c.70,000 hours

d.65,000 hours

QUESTION 9

During June, Cisco Company produced 12,000 chainsaw blades. The standard quantity of material allowed per unit was 1.5 pounds of steel per blade at a standard cost of $8 per pound. The actual cost was $7 per pound. The actual pounds of steel that Cisco purchased were 19,500 pounds. All materials purchased were used. Calculate Cisco's materials usage variance.

a.$10,500 U

b.$12,000 F

c.$12,000 U

d.$10,500 F

QUESTION 10

Marigold Company has developed the following standards for one of its products.

Direct materials: 10 pounds$12 per pound

Direct labor: 4 hours$20 per hour

Variable overhead: 5 hours$10 per hour

The following activity occurred during the month of October:

Materials purchased: 10,000 pounds costing $150,000

Materials used: 6,000 pounds

Units produced: 500 units

Direct labor: 2,300 hours at $23.60/hour

The company records materials price variances at the time of purchase. The direct materials price variance is:

a.$41,000 F.

b.$53,000 U.

c.$30,000 U.

d.$12,000 F.