Week four Midterm 1. Query : (TCO 1) Which of the next will not be a distinction between monetary accounting and managerial accounting? Pupil Reply: Monetary accounting is primarily involved with reporting the previous, whereas managerial accounting is extra involved with the long run. Managerial accounting makes use of extra nonmonetary data than is utilized in monetary accounting. Managerial accounting is primarily involved with offering data for exterior customers, whereas monetary accounting is anxious with inner customers. Monetary accounting should comply with GAAP, whereas managerial accounting will not be required to comply with GAAP. Query 2. Query : (TCO 1) Variable price per unit Pupil Reply: will increase when the variety of items produced will increase. doesn’t change when the variety of items produced will increase. decreases when the variety of items produced will increase. decreases when the variety of items produced decreases. Query three. Query : (TCO 1) You personal a automobile and are attempting to determine whether or not or to not commerce it in and purchase a brand new automobile. Which of the next prices is a chance price on this state of affairs? Pupil Reply: The journey to Cancun that you just won’t be able to take when you purchase the automobile The price of the automobile you’re buying and selling in The price of your books for this time period The price of your automobile insurance coverage final 12 months Query four. Query : (TCO 1) Shulaâs 347 Grill has budgeted the next prices for a month by which 1,600 steak dinners will likely be produced and bought: supplies, $four,080; hourly labor (variable), $5,200; hire (fastened), $1,700; depreciation, $800; and different fastened prices, $600. Every steak dinner sells for $14.00 every. Which is the budgeted whole variable price? Pupil Reply: $5,200 $9,280 $10,080 $2,300 Query 5. Query : (TCO 1) Which of the next prices will not be a part of manufacturing overhead? Pupil Reply: Electrical energy for the manufacturing facility Depreciation of manufacturing facility tools Salaries for the manufacturing supervisors Medical insurance for gross sales employees Query 6. Query : (TCO 1) Which of the next will not be a interval price? Pupil Reply: Promoting prices Accounting employees salaries Direct supplies Depreciation of accounting workplace tools Query 7. Query : (TCO 1) At December 31, 2010, WDT Inc. has a stability within the Work in Course of Stock account of $62,000. At January 1, 2010, the stability was $55,000. Present manufacturing prices for the 12 months are $292,000, and value of products bought is $284,000. How a lot is price of products manufactured? Pupil Reply: $292,000 $299,000 $277,000 $285,000 Query eight. Query : (TCO 2) BCS Firm applies manufacturing overhead primarily based on direct labor hours. Info regarding manufacturing overhead and labor for August follows. Estimated ActualOverhead price $174,000 $171,000Direct labor hours 5,800 5,900Direct labor price $87,000 $89,975How a lot overhead ought to be utilized in whole throughout August? Query 9. Query : (TCO 2) Citrus Firm incurred manufacturing overhead prices of $300,000. Complete overhead utilized to jobs was $306,000. What was the quantity of overapplied or underapplied overhead? Pupil Reply: $7,000 overapplied $6,000 overapplied $6,000 underapplied $13,000 underapplied Query 10. Query : (TCO three) Firms by which of the next industries wouldn’t be possible to make use of course of costing? Pupil Reply: Cereals Paints Cosmetics Auto physique repairs Query 11. Query : (TCO three) The mixing division started the interval with 45,000 items. Throughout the interval, the division acquired one other 30,000 items from the prior division and accomplished 60,000 items through the interval. The remaining items have been 75% full. How a lot are equal items within the mixing departmentâs Work In Course of Stock on the finish of the interval? Pupil Reply: 30,000 22,500 15,000 11,250 Query 12. Query : (TCO three) Ranger Glass Firm manufactures glass for French doorways. In the beginning of Might, 2,000 items have been in course of. Throughout Might, 11,000 items have been accomplished and three,000 items have been in course of on the finish of Might. These in-process items have been 90% full with respect to materials and 50% full with respect to conversion prices. Different data is as follows.Work in course of, Might 1:Direct materials $36,000Conversion prices $45,000Prices incurred throughout Might:Direct materials $186,000Conversion prices $255,000How a lot is the price per equal unit for direct supplies? Pupil Reply: $24.00 $16.20 $15.86 $13.58 Query 13. Query : (TCO four) Duradyne Inc. has whole prices of $18,000 when 2,000 items are produced and $26,000 when 5,200 items are produced. Throughout March, four,000 items have been produced and bought for $eight every. Which is the variable price per unit? Pupil Reply: $2.50 $zero.40 $2.00 $four.00 Query 14. Query : (TCO four) Which of the next could have no impact on the break-even level in items? Pupil Reply: The promoting value rising The variable price per unit rising The gross sales quantity rising Complete fastened prices enhance Query 15. Query : (TCO four) Werth Firm produces tie racks. The estimated fastened prices for the 12 months are $288,000, and the estimated variable prices per unit are $14. Werth expects to supply and promote 60,000 items at a value of $20 per unit. How a lot is the break-even level in items? Pupil Reply: 48,000 72,000 three,600 eight,471 Query 16. Query : (TCO four) Paula Company sells a single product at a value of $275 per unit. Variable price per unit is $135 and stuck prices whole $356,860. If gross sales are anticipated to be $825,000, which is Paulaâs margin of security? Pupil Reply: $468,140 $124,zero25 $700,975 $405,000 Query 17. Query : (TCO 5) Which of the next is handled in a different way in full costing than in variable costing? Pupil Reply: Direct supplies Mounted manufacturing overhead Direct labor Variable manufacturing overhead Query 18. Query : (TCO 5) Variable costing earnings is a operate of Pupil Reply: items bought solely. items produced solely. each items bought and items produced. neither items bought nor items produced. Query 19. Query : (TCO 5) Peak Manufacturing produces snow blowers. The promoting value per snow blower is $100. Prices concerned in manufacturing are as follows.Direct materials per unit: $20Direct labor per unit: 12Variable manufacturing overhead per unit: 10Mounted manufacturing overhead per 12 months: $148,500As well as, the corporate has fastened promoting and administrative prices of $150,000 per 12 months.Throughout the 12 months, Peak produces 45,000 snow blowers and sells 30,000 snow blowers. How a lot is price of products bought, utilizing full costing? Pupil Reply: $1,359,000 $1,260,000 $2,038,500 $1,408,500 Query 20. Query : (TCO 6) Which of the next will not be a purpose why firms allocate prices? Pupil Reply: To calculate the total price of merchandise for monetary reporting functions To discourage managers from utilizing exterior suppliers To cut back the frivolous use of firm assets To offer data wanted by managers to make acceptable choices Query 21. Query : (TCO 6) The overriding concern in forming a value pool is to make sure that Pupil Reply: there aren’t any variable prices in the price pool. the whole quantity in the price pool is lower than the direct prices for the product. solely prices which have been budgeted are included in the price pool. the prices within the pool are homogeneous or related. Query 22. Query : (TCO 6) AC Consulting Firm has bought a brand new $18,038 copier. This overhead price will likely be shared by the buying, accounting, and data know-how departments, as a result of these are the one departments that can be capable to entry the machine. The corporate has determined to allocate the price primarily based on the variety of copies made by every division. Every division has estimated the variety of copies that will likely be remodeled the lifetime of the copier.Division CopiesPurchasing: 250,000Accounting: 300,000Info Tech: 425,000If price allocations are computed to 4 important digits and the buying division makes 58,000 copies this 12 months, how a lot overhead will likely be allotted to buying? Pupil Reply: $four,185 $four,624 $77,750 $1,073 Query 23. Query : (TCO 7) An organization is attempting to determine whether or not to promote partially accomplished items of their present state or incur extra prices to complete the products and promote them as full items. Which of the next will not be related to the choice? Pupil Reply: The promoting value of the finished items The prices incurred to course of the items so far The promoting value of the partially accomplished items The prices that will likely be incurred to complete the items Query 24. Query : (TCO 7) BigByte Firm has 12 out of date computer systems which are carried in stock at a value of $13,200. If these computer systems are upgraded at a value of $7,500, they may very well be bought for $15,300. Alternatively, the computer systems may very well be bought as is for $9,000. Which is the online benefit or drawback of remodeling the computer systems? Pupil Reply: $6,300 benefit $1,200 drawback $5,400 drawback $three,000 benefit Query 25. Query : (TCO 7) YXZ Companyâs marketplace for the Mannequin 55 has modified considerably, and YXZ has needed to drop the worth per unit from $275 to $135. There are some items within the Work In Course of Stock which have prices of $160 per unit related to them. YXZ might promote these items of their present state for $100 every. It can price YXZ $10 per unit to finish these items in order that they are often bought for $135 every.When the incremental revenues and bills are analyzed, which is the monetary affect? Pupil Reply: $25 per-unit revenue if the items are accomplished $125 per-unit revenue if the items are accomplished $65 per-unit loss if the items are accomplished $150 per-unit loss if the items are accomplished Query 26. Query : (TCO three) Why is it needed to make use of equal items in a course of costing system? Query 27. Query : (TCO 7) Maxley Markets Firm sells emblem sports activities merchandise and does customized embroidery. It’s attempting to determine whether or not or to not proceed embroidery. The next data is offered for the segments. Assume that every one direct fastened prices may very well be prevented if a phase is dropped and that the whole widespread fastened prices would stay unchanged if the embroidery was dropped. Embroidery Attire SalesSales $120,000 $420,000Variable Prices $90,000 $220,000Contribution Margin $30,000 $200,000Direct Mounted Prices $18,000 $70,000Allotted Widespread Mounted Prices $20,000 $70,000Web Earnings ($ eight,000) $ 60,000(a) What could be the affect on income if embroidery was dropped?(b) Assume that if embroidery was dropped, attire gross sales would enhance 20%. What’s the affect on contribution margin?(c) Give an instance of a value that isn’t differential or related on this evaluation. Query 28. Query : (TCO four) The next month-to-month knowledge can be found for RedEx, which produces just one product that it sells for $84 every. Its unit variable prices are $28, and its whole fastened bills are $64,960. Gross sales throughout April totaled 1,600 items.(a) How a lot is the break-even level in gross sales for RedEx?(b) What number of items should RedEx promote with a view to earn a revenue of $24,640?(c) A brand new worker means that RedEx sponsor an organization softball crew as a type of promoting. The fee to sponsor the crew is $1,792. What number of extra items should be bought to cowl this extra price?