| Question Detail: 1)Under a relevant range of production, when total quantities sold increase, total fixed costs Don't use plagiarized sources. Get Your Custom Essay on accounting mcqs 498702 For $10/Page 0nly | increase | | decrease | | remain equal | | there is no relationship | 2)Conversion costs are | only direct material | | only direct labor | | only overhead | | overhead and direct labor | 3)XY Company sells its unique product at $30.00. Variable costs per unit are $20.00. Total fixed sales salaries per month $40,000.00. Other fixed costs per month $60,000.00. Assume that the company wants to change the sales salaries as follows: Total fixed sales salaries per month 25,000. Sales commission of 10% of sales.?Find at what sale-level is the company indifferent between the two alternatives | $5,000 | | 5,000 units | | 10,000 | | 7,500 units | | 4) AJ Company makes three products. | ? | ? | ? | | Current selling price per unit, variable cost per unit, and machine hours required are as follows: | | ? | ? | Products | ? | | ? | X | Y | Z | | Current selling price per unit | $20 | $30 | $20 | | Variable cost per unit | 10 | 18 | 12 | | Machine hours required for each unit | 2 | 3 | 4 | | The company has a maximum of 1000 machine hours available per month. | Assume the company produces all products; find the total contribution margin per hour. | 5) TC Company makes several printing works using two machines (X and Y). | | Data on the two machines for June 2010 are as follows: | | X | Y | | Direct material | 10 | 15 | | Time required for each unit (TR) | 2 | 3 | | Expected volume during the month (EV) | 2,000 | 500 | | Expected labor cost per hour | 50 | | Budgeted overhead costs | 660,000 | | Determine | | The overhead rate per labor hour | | FOAR = $120.00 per hour worked | | FOAR = 120.00 per dollar | | FOAR = $60.00 per hour worked | | FOAR = $120.00 per overhead costs | 6) Assume the cost structure is as follows: TC = 25,000 + 5q, where TC = total costs, q = quantities sold. Under relevant range of sales, selling price per unit is $8.00. Total fixed costs are | $100,000 | | $50,000 | | $25,000 | | More information is needed | | 7) The income statements of Tahany Company for June and July 2005 are as follows: | | June | July | | Sales | 610 | 650 | | Cost of goods sold | 420 | 460 | | Gross margin | 190 | 190 | | Selling and administrative expenses | 185 | 195 | | Income before tax | 5 | -5 | Using High Low Method, the variable component of cost of goods sold is 8) Non value added activities are | Direct material (only) | | Direct labor (only) | | Overhead (only) | | Not essential costs to make/manufacture a product | | 9) Tany Corporation is a small table manufacturing company operating in the north of Puerto Rico. | | Managers estimate the following costs per unit (one table) | | Direct material (DM) | $6.00 | | Direct labor (DL) | $4.00 | | Variable manufacturing overhead (VMO) | $3.00 | | Variable administrative expenses (VAE) | $1.00 | | The estimated contribution margin is | 30% | | Monthly fixed costs are | | Manufacturing | $10,000.00 | | Administrative | $5,000.00 | | 10) Tany Corporation is a small table manufacturing company operating in the north of Puerto Rico. | | Managers estimate the following costs per unit (one table) | | Direct material (DM) | $6.00 | | Direct labor (DL) | $4.00 | | Variable manufacturing overhead (VMO) | $3.00 | | Variable administrative expenses (VAE) | $1.00 | | The estimated contribution margin is | 30% | | Monthly fixed costs are | | Manufacturing | $10,000.00 | | Administrative | $5,000.00 | Total unit sold during last month is 2525, what is the total operating income. | between $100 and $120 | | between $120 and $140 | | between $140 and $160 | | between $160 and $180 | 11) BC Company estimates the following data for the coming month: total variable costs $60,000.00, income tax rate 30%, contribution margin percentage 60%. Find the estimated total sales for the coming month. | $100,000 | | $60,000 / 40% | | $60,000 / 60% | | $60,000 X 60% | 12) If a company raises its required net income | the tax rate will decrease | | break even point is negative | | required contribution margin increases | | required contribution margin decreases | 13)If a company raises its required operating profit | break even point is negative | | break even point is zero | | required contribution margin increases | | required contribution margin decreases | 14) Copy of XYZ has three products X, Y and Z. The following information pertains to these products X, Y, and Z. Contribution margin percentages are 40%, 50%, and 40% respectively. Sales mix percentages are 20%, 30%, and 50% respectively. Monthly fixed costs are estimated to be $100.00. The weighted average contribution margin percentage is 15) Which of the following examples is a short term decision? | Make or buy decision | | Purchase of land | | Issuing bonds | | Joint venture | | Purchase of building | | 16) Sales (in units) | 60,000 | | Selling price per unit | 25 | | Manufacturing costs per unit: | | Materials | 5 | | Direct labor | 4 | | Overhead | | Variable | 4 | | Fixed | 6 | | Total | 19 | | Gross margin | 6 | | Selling and admin. Expenses per unit | 2 | | Operating income | 4 | | A company in a foreign market offer to buy and the offer specifies the following data | | units to be sold | 10000 | | price per unit | 20 | | If the Company accepts the special offer, the incremental profit would be | | $70,000.00 | | ($70,000.00) | | $10,000.00 | | ($10,000.00) | | 17) Total Costs | Unit Cost | | Direct materials | 20,000 | 2.00 | | Direct labor | 25,000 | 2.50 | | Variable overhead | 15,000 | 1.50 | | Fixed overhead (non-avoidable) | 24000 | 2.40 | | Fixed overhead (avoidable) | 26,000 | 2.60 | | Purchase cost | 85,999 | Should the company produce the product internally? | Yes | | No | | Indifferent to to make or to buy | | Yes if the market price per unit covers the fixed cost per unit. | | 18) Sales (in units) | 60,000 | | Selling price per unit | 25 | | Manufacturing costs per unit: | | Materials | 5 | | Direct labor | 4 | | Overhead | | Variable | 4 | | Fixed | 6 | | Total | 19 | | Gross margin | 6 | | Selling and admin. Expenses per unit (fixed) | 2 | | Operating income | 4 | | A company in a foreign market offer to buy and the offer specifies the following data | | units to be sold | 10,000 | | price per unit | 13.1 | | Should the company sell this special order? | | Yes, accept | | No, reject | | Indifferent to reject or not | | Always reject | | Which of the following costs should be considered in short term decisions? | |