Accounting for Managers 7 - (35 MC questions)

Question 6 of 40

2.5 Points

Standard DL hours per tub

3

Standard overhead rate per DL hour

$6.50

Standard overhead cost per unit

$19.50

Actual overhead costs

$22,750

Actual DL hours

3,250

Actual overhead cost per machine hour

$7.00

Actual tubs produced

1,100

A. $1,625 unfavorable

B. $325 unfavorable

C. $1,625 favorable

D. $325 favorable

Question 7 of 40

2.5 Points

Standard Total Cost

Actual Total Cost

Direct labor:

Standard: 540 hours at $6.75/hr.

3,645

Actual: 500 hours at $6.50/hr.

3,250

A. $260 favorable

B. $260 unfavorable

C. $270 favorable

D. $270 unfavorable

Question 9 of 40

2.5 Points

Direct materials standard (6 pounds per unit @ $0.55/lb.)

$3.30 per finished good

Direct materials flexible budget variance-unfavorable

$12,000

Actual direct materials used

35,000 pounds

Actual finished goods produced

26,000 units

A. $19,250

B. $73,800

C. $97,800

D. $85,800

Question 10 of 40

2.5 Points

A. managers can evaluate the efficiency of production workers.

B. differences between the static budget and the flexible budget can be broken down into price and quantity components.

C. consumer motivation for purchases can be analyzed.

D. standard costing allows companies to create flexible budgets.

Question 11 of 40

2.5 Points

A. $40 favorable

B. $40 unfavorable

C. $45 favorable

D. $45 unfavorable

Question 12 of 40

2.5 Points

A. $16,500 favorable

B. $16,500 unfavorable

C. $15,750 unfavorable

D. $15,750 favorable

Question 13 of 40

2.5 Points

A. Debit to work-in-process inventory for the actual cost of overhead

B. Credit to work-in-process inventory for the standard rate of overhead times the standard quantity of the allocation base allowed for actual output

C. Credit to work-in-process inventory for the actual cost of overhead

D. Debit to work-in-process inventory for the standard rate of overhead times the standard quantity of the allocation base allowed for actual output

How is the variable manufacturing overhead efficiency variance calculated?

Which term below is best paired with "The difference between the actual overhead cost incurred and the flexible budget amount of overhead cost for actual number of output"?

The two fixed overhead variances are the:

A company's purchasing department negotiates all of the purchasing contracts for raw materials. Which variance is most useful in assessing the performance of the purchasing department?

Which of the following is NOT an advantage of using standard costs and variances?

Kahn Performance Nutrition produces a protein shake that contains whey protein as one of its ingredients. The whey protein (materials) standards for each batch of protein shake produced are 12 pounds of whey protein at a standard cost of $3 per pound. During July, Kahn Performance Nutrition purchased and used 54,000 pounds of whey protein at a total of $170,000 to make a total of 4,300 batches of protein shake. What is the materials quantity variance for whey protein in July?

How is the direct labor efficiency variance calculated?

What is an attribute of the internal rate of return?

Which of the following is NOT a factor when considering the time value of money?

Siesta Manufacturing has asked you to evaluate a capital investment project. The project will require an initial investment of $88,000. The life of the investment is 7 years with a residual value of $4,000. If the project produces net annual cash inflows of $16,000, what is the accounting rate of return?

Which of the following capital decision methods uses accrual accounting, rather than net cash flows, as a basis for calculations?

Which of the following decision rules is a correct statement?

Mulheim Corporation is deciding whether to automate one phase of its production process. The equipment has a 6-year life and will cost $410,000. Projected net cash inflows from the equipment are as follows.

Mulheim Corporation's hurdle rate is 12%. Assume the residual value is zero. What is the net present value of the equipment?

The following are all methods of analyzing capital investments EXCEPT:

Eagle Corporation is considering the purchase of a new machine. The machine costs $550,000 and will generate an annual net cash inflow of $100,000. What is the payback period?

The internal rate of return is:

Smith & Cramer Computer Repair is considering an investment in computer and network equipment costing $254,000. This equipment would allow them to offer new programming services to clients. The equipment will be depreciated on the straight-line basis over an 8-year period with an estimated residual value of $60,000. Using the accounting rate of return model, what is the minimum average annual operating income that must be generated from this investment in order to achieve an 11% accounting rate of return?

The term ________ is best described as "a stream of equal periodic payments."

The Warren Company is considering investing in two alternative projects.

What is the accounting rate of return for Project 2?

Assuming an interest rate of 6%, the present value of $22,000 to be received 9 years from now would be closest to:

Which of the following areas does NOT make significant use of time value of money concepts?

"Management's minimum desired rate of return on an investment" is best described by which of the following terms?

A manager wants to know which investment decision will affect the bottom line of the financial statements according to Generally Accepted Accounting Principles. Which capital budgeting method would he choose?

Hincapie Manufacturing is evaluating investing in a new metal stamping machine costing $30,924. Hincapie estimates that it will realize $12,000 in annual cash inflows for each year of the machine's 3-year useful life. The internal rate of return (IRR) for the machine is approximately:

Mantua Motors is evaluating a capital investment opportunity. This project would require an initial investment of $38,000 to purchase equipment. The equipment will have a residual value at the end of its life of $3,000. The useful life of the equipment is 5 years. The new project is expected to generate additional net cash inflows of $12,000 per year for each of the 5 years. Mantua Motors' required rate of return is 14%. The net present value of this project is closest to:

You win the lottery and must decide how to take the payout. Use an 8% discount rate. What is the present value of $15,000 a year received at the end of each of the next 6 years?

All else being equal, a company would choose to invest in a capital asset if which of the following is true?