ACC 349 Final Exam

ACC 349 Final Exam

1)
What is the best way to handle manufacturing overhead costs in order to get the
most timely job cost information?

2) At the end of the year, manufacturing overhead has been over applied. What
occurred to create this situation?

3) Luca Company over applied manufacturing overhead during 2006. Which one of
the following is part of the year end entry to dispose of the over applied
amount assuming the amount is material

4) Which of the following would be accounted for using a job order cost system?

5) Which one of the following is NEVER part of recording the issuance of raw
materials in a job order cost system?

6. What is unique about the flow of costs in a job order cost system?

7) Which one of the following costs would be included in manufacturing overhead
of a lawn mower manufacturer?

8) What broad functions do the management of an organization perform?

9) Which of the following represents the correct order in which inventories are
reported on a manufacturer’s balance sheet?

10) In traditional costing systems, overhead is generally applied based on

11) An activity that has a direct cause-effect relationship with the resources
consumed is a(n)

12) A well-designed activity-based costing system starts with

13) Which of the following factors would suggest a switch to activity-based
costing?

14) All of the following statements are correct EXCEPT that

15) What sometimes makes implementation of activity-based costing difficult in
service industries is

16) One of Astro Company’s activity cost pools is machine setups, with
estimated overhead of $150,000. Astro produces sparklers (400 setups) and
lighters (600 setups). How much of the machine setup cost pool should be
assigned to sparklers?

17) Poodle Company manufactures two products, Mini A and Maxi B. Poodle’s
overhead costs consist of setting up machines, $800,000; machining, $1,800,000;
and inspecting, $600,000. Information on the two products is:

18) Poodle Company manufactures two products, Mini A and Maxi B. Poodle’s
overhead costs consist of setting up machines, $800,000; machining, $1,800,000;
and inspecting, $600,000. Information on the two products is:

19)
Seran Company has contacted Truckel Inc. with an offer to sell it 5,000 of the
wickets for $18 each. If Truckel makes the wickets, variable costs are $11 per
unit. Fixed costs are $12 per unit; however, $5 per unit is avoidable. Should
Truckel make or buy the wickets?

20) Rosen, Inc. has 10,000 obsolete calculators, which are carried in inventory
at a cost of $20,000. If the calculators are scrapped, they can be sold for
$1.10 each (for parts). If they are repackaged, at a cost of $15,000, they
could be sold to toy stores for $2.50 per unit. What alternative should be
chosen, and why?

21) The cost to produce Part A was $10 per unit in 2005. During 2006, it has
increased to $11 per unit. In 2006, Supplier Company has offered to supply Part
A for $9 per unit. For the make-or-buy decision

22) Hartley, Inc. has one product with a selling price per unit of $200, the
unit variable cost is $75, and the total monthly fixed costs are $300,000. How
much is Hartley’s contribution margin ratio?

23. Which statement describes a fixed cost?

24) Disney’s variable costs are 30% of sales. The company is contemplating an
advertising campaign that will cost $22,000. If sales are expected to increase
$40,000, by how much will the company’s net income increase?

25) Variable costing

26) Which cost is NOT charged to the product under variable costing?

27) Orbach Company sells its product for $40 per unit. During 2005, it produced
60,000 units and sold 50,000 units (there was no beginning inventory). Costs
per unit are: direct materials $10, direct labor $6, and variable overhead $2.
Fixed costs are: $480,000 manufacturing overhead, and $60,000 selling and
administrative expenses. The per unit manufacturing cost under absorption
costing is

28) Which of the following is NOT considered an advantage of using standard
costs?

29)
The difference between a budget and a standard is that

30) If a company is concerned with the potential negative effects of
establishing standards, they should

31) The per-unit standards for direct materials are 2 gallons at $4 per gallon.
Last month, 11,200 gallons of direct materials that actually cost $42,400 were used
to produce 6,000 units of product. The direct materials quantity variance for
last month was

32) The standard number of hours that should have been worked for the output
attained is 8,000 direct labor hours and the actual number of direct labor
hours worked was 8,400. If the direct labor price variance was $8,400
unfavorable, and the standard rate of pay was $18 per direct labor hour, what
was the actual rate of pay for direct labor?

33) The total variance is $10,000. The total materials variance is $4,000. The
total labor variance is twice the total overhead variance. What is the total
overhead variance?

34)
Manufacturing overhead costs are applied to work in process on the basis of

35)
The overhead volume variance relates only to

36)
If the standard hours allowed are less than the standard hours at normal
capacity

37)
Gottberg Mugs is planning to sell 2,000 mugs and produce 2,200 mugs during
April. Each mug requires 2 pounds of resin and a half hour of direct labor.
Resin costs $1 per pound and employees of the company are paid $12.50 per hour.
Manufacturing overhead is applied at a rate of 120% of direct labor costs.
Gottberg has 2,000 pounds of resin in beginning inventory and wants to have
2,400 pounds in ending inventory. How much is the total amount of budgeted
direct labor for April?

38)
Lewis Hats is planning to sell 600 straw hats. Each hat requires a half pound
of straw and a quarter hour of direct labor. Straw costs $0.20 per pound and
employees of the company are paid $22 per hour. Lewis has 80 pounds of straw
and 40 hats in beginning inventory and wants to have 50 pounds of straw and 60
hats in ending inventory. How many units should Lewis Hats produce in April?

39)
At January 1, 2004, Barry, Inc. has beginning inventory of 4,000 widgets. Barry
estimates it will sell 35,000 units during the first quarter of 2004 with a 10%
increase in sales each quarter. Barry’s policy is to maintain an ending
inventory equal to 25% of the next quarter’s sales. Each widget costs $1 and is
sold for $1.50. How much is budgeted sales revenue for the third quarter of
2004?

40) In most cases prices are set by the

41) A company must price its product to cover its costs and earn a reasonable
profit in

42.
The cost plus price approach’s major advantage is