Acct 344 Final Exam Latest 2014 – Devry

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ACCT 344 FINAL EXAM LATEST 2014 – DEVRY

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ACCT 344 FINAL EXAM LATEST 2014 - DEVRY(TCO 2) WHICH COST IS NOT A PERIOD COST? (POINTS : 5)Lumber for furnitureExecutive administrative assistant salaryDepreciation on sales staff's carsSales commissionQuestion 2.2.(TCO 2) Which product would use job-order costing? (Points : 5)Ink pensCustom boot makerSoda popHorse saddlesQuestion 3.3.(TCO 3) As production occurs, materials, direct labor, and applied manufacturing overhead are recorded in (Points : 5)cost of goods sold.work-in-process.materials.finished goods.Question 4.4.(TCO 8) A company keeps 60 days of materials inventory on hand to avoid shutdowns due to materials shortages. Carrying costs average $5,000 per day. A competitor keeps 30 days of inventory on hand, and the competitor's carrying costs average $2,000 per day. The value-added costs are (Points : 5)$300,000.$150,000.$60,000.$0.Question 5.5.(TCO 8) Which is a value-added activity?(Points : 5)MovingInspectionProcessingWaitingQuestion 6.6.(TCO 1) The break-even point is (Points : 5)the volume of activity where all fixed costs are recovered.where fixed costs equal total variable costs.where total revenues equal total costs.where total costs equal total contribution margin.Question 7.7.(TCO 1) The Kringel Company provides the following information.Sales (200,000 units) $500,000Manufacturing costsVariable $170,000Fixed $30,000Selling and administrative costsVariable $80,000Fixed $20,000 Which is the break-even point in units for Kringel? (Points : 5)33,334 units100,000 units40,000 units200,000 unitsQuestion 8.8.(TCO 7) Which would be the most appropriate base for allocating the costs of the maintenance department? (Points : 5)Machine hoursDirect labor hoursNumber of employeesSquare feetQuestion 9.9.(TCO 7) Yo Department Store incurred $8,000 of indirect advertising costs for its operations. The following data have been collected for 2013 for its three departments.ShoesCosmeticsCraftsSales$120,000$100,000$100,000Direct advertising costs$9,000$7,000$4,000Newspaper ad space60%20%20%How much of the indirect advertising costs will be allocated to the Cosmetics Department if newspaper ad space is the activity driver?(Points : 5)$8,000$1,600$1,400$6,400Question 10.10.(TCO 5) Which best describes zero-base budgeting? (Points : 5)A budget that is developed for a single level of activityA budget that analyzes existing activities (and continuation of that activity must be justified and resources needed must be justified by each manager)A budget that is based solely on prior period information, adjusted for inflationA budget that is continuous or rollingQuestion 11.11.(TCO 5) Bug Company manufactures buggies. Manufacturing a buggy takes 20 units of wood and 1 unit of steel. Scheduled production of buggies for the next 2 months is 500 and 600 units, respectively. Beginning inventory is 4,000 units of wood and 30 units of steel. The ending inventory of wood is planned to decrease 500 units in each of the next 2 months, and the steel inventory is expected to increase 5 units in each of the next 2 months.How many units of wood are expected to be used in production during the second month?(Points : 5)12,500 units10,000 units15,000 units12,000 unitsQuestion 12.12.(TCO 4) Which statement is true? (Points : 5)Absorption costing net income exceeds variable costing net income when units produced and sold are equal.Variable costing net income exceeds absorption costing net income when units produced exceed units sold.Absorption costing net income exceeds variable costing net income when units produced are less than units sold.Absorption costing net income exceeds variable costing net income when units produced are greater than units soldQuestion 13.13.(TCO 6) Using more highly skilled direct laborers might affect which variance?(Points : 5)Direct materials usage varianceDirect labor efficiency varianceVariable manufacturing overhead efficiency varianceAll of the aboveQuestion 14.14.(TCO 6) Which equation measures the total budget variance? (Points : 5)AQ x (AP - SP).SP x (AQ - SQ).SQ x (AP - SP).(AQ x AP) - (SQ x SP).(TCO 1) George Corporation has an estimated monthly sales of 12,000 units for $80 per unit. Variable costs include manufacturing costs of $50 and distribution costs of $20. Fixed costs are $60,000 per month.Required:Determine each of the following values.a. Unit contribution marginb. Monthly break-even unit sales volume Create a contribution margin-based income statement.(Points : 30)Question 2.2.(TCO 7) Darling Manufacturing Inc. manufactures two products, A and B, from a joint process. A single production costs $5,000 and results in 200 units of A and 800 units of B. To be ready for sale, both products must be processed further, incurring seperable costs of $3 per unit for A and $4 per unit for B. The market price for Product A is $15 and for Product B is $10.Required: Allocate joint production costs to each product using the net realizable value method.(Points : 30)Question 3.3.(TCO 6) Santa Inc. manufactures toys based on the following information.Standard costsMaterials (4 ounces at $4)$16Direct labor (1 hour per unit)$7Variable overhead (based on direct labor hours)$3.50 Fixed overhead budget$16,000 Materials purchasedActual results and costsUnits10,000Cost$38,500Materials used in productionFinished product units2,200Raw material (ounces)9,500Direct labor hours2,200Direct labor cost$18,000Variable overhead costs$8,400Fixed overhead costs$16,200Required:Compute the following variances (show calculations).a. Materials usage varianceb. Labor rate variance-c. Fixed overhead budget variance(Points : 30)Question 4.4.(TCO 4) Toshi Company incurred the following costs in manufacturing desk calculators.Direct materials $14Indirect materials (variable) 4Direct labor 8Indirect labor (variable) 6Other variable factory overhead 10Fixed factory overhead 28Variable selling expenses 20Fixed selling expenses 14During the period, the company produced and sold 1,000 units. a. What is the inventory cost per unit using absorption costing? b. What is the inventory cost per unit using variable costing?(Points : 30)Question 5.5.(TCO 8) Musical Instruments Company manufactures two products (trumpets and trombones). Overhead costs ($175,000) have been divided into three cost pools that use the following activity drivers.ProductNumber of setupsMachine hoursPacking ordersTrumpets501,500150Trombones504,500250Cost per pool$60,000$90,000$25,000 Required (show all calculations) a. What is the allocation rate for trumpets per setup using activity-based costing? b. What is the allocation rate for trumpets per machine hours using activity-based costing?c. What is the allocation rate for trumpets per packing order using activity-based costing?(Points : 30) $25.00 Required: Prepare a performance report for all costs, showing flexible budget variances (indicate F or U).

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ACCT 344 FINAL EXAM LATEST 2014 – DEVRY

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ACCT 344 FINAL EXAM LATEST 2014 - DEVRY(TCO 2) WHICH COST IS NOT A PERIOD COST? (POINTS : 5)Lumber for furnitureExecutive administrative assistant salaryDepreciation on sales staff's carsSales commissionQuestion 2.2.(TCO 2) Which product would use job-order costing? (Points : 5)Ink pensCustom boot makerSoda popHorse saddlesQuestion 3.3.(TCO 3) As production occurs, materials, direct labor, and applied manufacturing overhead are recorded in (Points : 5)cost of goods sold.work-in-process.materials.finished goods.Question 4.4.(TCO 8) A company keeps 60 days of materials inventory on hand to avoid shutdowns due to materials shortages. Carrying costs average $5,000 per day. A competitor keeps 30 days of inventory on hand, and the competitor's carrying costs average $2,000 per day. The value-added costs are (Points : 5)$300,000.$150,000.$60,000.$0.Question 5.5.(TCO 8) Which is a value-added activity?(Points : 5)MovingInspectionProcessingWaitingQuestion 6.6.(TCO 1) The break-even point is (Points : 5)the volume of activity where all fixed costs are recovered.where fixed costs equal total variable costs.where total revenues equal total costs.where total costs equal total contribution margin.Question 7.7.(TCO 1) The Kringel Company provides the following information.Sales (200,000 units) $500,000Manufacturing costsVariable $170,000Fixed $30,000Selling and administrative costsVariable $80,000Fixed $20,000 Which is the break-even point in units for Kringel? (Points : 5)33,334 units100,000 units40,000 units200,000 unitsQuestion 8.8.(TCO 7) Which would be the most appropriate base for allocating the costs of the maintenance department? (Points : 5)Machine hoursDirect labor hoursNumber of employeesSquare feetQuestion 9.9.(TCO 7) Yo Department Store incurred $8,000 of indirect advertising costs for its operations. The following data have been collected for 2013 for its three departments.ShoesCosmeticsCraftsSales$120,000$100,000$100,000Direct advertising costs$9,000$7,000$4,000Newspaper ad space60%20%20%How much of the indirect advertising costs will be allocated to the Cosmetics Department if newspaper ad space is the activity driver?(Points : 5)$8,000$1,600$1,400$6,400Question 10.10.(TCO 5) Which best describes zero-base budgeting? (Points : 5)A budget that is developed for a single level of activityA budget that analyzes existing activities (and continuation of that activity must be justified and resources needed must be justified by each manager)A budget that is based solely on prior period information, adjusted for inflationA budget that is continuous or rollingQuestion 11.11.(TCO 5) Bug Company manufactures buggies. Manufacturing a buggy takes 20 units of wood and 1 unit of steel. Scheduled production of buggies for the next 2 months is 500 and 600 units, respectively. Beginning inventory is 4,000 units of wood and 30 units of steel. The ending inventory of wood is planned to decrease 500 units in each of the next 2 months, and the steel inventory is expected to increase 5 units in each of the next 2 months.How many units of wood are expected to be used in production during the second month?(Points : 5)12,500 units10,000 units15,000 units12,000 unitsQuestion 12.12.(TCO 4) Which statement is true? (Points : 5)Absorption costing net income exceeds variable costing net income when units produced and sold are equal.Variable costing net income exceeds absorption costing net income when units produced exceed units sold.Absorption costing net income exceeds variable costing net income when units produced are less than units sold.Absorption costing net income exceeds variable costing net income when units produced are greater than units soldQuestion 13.13.(TCO 6) Using more highly skilled direct laborers might affect which variance?(Points : 5)Direct materials usage varianceDirect labor efficiency varianceVariable manufacturing overhead efficiency varianceAll of the aboveQuestion 14.14.(TCO 6) Which equation measures the total budget variance? (Points : 5)AQ x (AP - SP).SP x (AQ - SQ).SQ x (AP - SP).(AQ x AP) - (SQ x SP).(TCO 1) George Corporation has an estimated monthly sales of 12,000 units for $80 per unit. Variable costs include manufacturing costs of $50 and distribution costs of $20. Fixed costs are $60,000 per month.Required:Determine each of the following values.a. Unit contribution marginb. Monthly break-even unit sales volume Create a contribution margin-based income statement.(Points : 30)Question 2.2.(TCO 7) Darling Manufacturing Inc. manufactures two products, A and B, from a joint process. A single production costs $5,000 and results in 200 units of A and 800 units of B. To be ready for sale, both products must be processed further, incurring seperable costs of $3 per unit for A and $4 per unit for B. The market price for Product A is $15 and for Product B is $10.Required: Allocate joint production costs to each product using the net realizable value method.(Points : 30)Question 3.3.(TCO 6) Santa Inc. manufactures toys based on the following information.Standard costsMaterials (4 ounces at $4)$16Direct labor (1 hour per unit)$7Variable overhead (based on direct labor hours)$3.50 Fixed overhead budget$16,000 Materials purchasedActual results and costsUnits10,000Cost$38,500Materials used in productionFinished product units2,200Raw material (ounces)9,500Direct labor hours2,200Direct labor cost$18,000Variable overhead costs$8,400Fixed overhead costs$16,200Required:Compute the following variances (show calculations).a. Materials usage varianceb. Labor rate variance-c. Fixed overhead budget variance(Points : 30)Question 4.4.(TCO 4) Toshi Company incurred the following costs in manufacturing desk calculators.Direct materials $14Indirect materials (variable) 4Direct labor 8Indirect labor (variable) 6Other variable factory overhead 10Fixed factory overhead 28Variable selling expenses 20Fixed selling expenses 14During the period, the company produced and sold 1,000 units. a. What is the inventory cost per unit using absorption costing? b. What is the inventory cost per unit using variable costing?(Points : 30)Question 5.5.(TCO 8) Musical Instruments Company manufactures two products (trumpets and trombones). Overhead costs ($175,000) have been divided into three cost pools that use the following activity drivers.ProductNumber of setupsMachine hoursPacking ordersTrumpets501,500150Trombones504,500250Cost per pool$60,000$90,000$25,000 Required (show all calculations) a. What is the allocation rate for trumpets per setup using activity-based costing? b. What is the allocation rate for trumpets per machine hours using activity-based costing?c. What is the allocation rate for trumpets per packing order using activity-based costing?(Points : 30) $25.00 Required: Prepare a performance report for all costs, showing flexible budget variances (indicate F or U).

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ACCT 344 FINAL EXAM LATEST 2014 – DEVRY

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ACCT 344 FINAL EXAM LATEST 2014 - DEVRY(TCO 2) WHICH COST IS NOT A PERIOD COST? (POINTS : 5)Lumber for furnitureExecutive administrative assistant salaryDepreciation on sales staff's carsSales commissionQuestion 2.2.(TCO 2) Which product would use job-order costing? (Points : 5)Ink pensCustom boot makerSoda popHorse saddlesQuestion 3.3.(TCO 3) As production occurs, materials, direct labor, and applied manufacturing overhead are recorded in (Points : 5)cost of goods sold.work-in-process.materials.finished goods.Question 4.4.(TCO 8) A company keeps 60 days of materials inventory on hand to avoid shutdowns due to materials shortages. Carrying costs average $5,000 per day. A competitor keeps 30 days of inventory on hand, and the competitor's carrying costs average $2,000 per day. The value-added costs are (Points : 5)$300,000.$150,000.$60,000.$0.Question 5.5.(TCO 8) Which is a value-added activity?(Points : 5)MovingInspectionProcessingWaitingQuestion 6.6.(TCO 1) The break-even point is (Points : 5)the volume of activity where all fixed costs are recovered.where fixed costs equal total variable costs.where total revenues equal total costs.where total costs equal total contribution margin.Question 7.7.(TCO 1) The Kringel Company provides the following information.Sales (200,000 units) $500,000Manufacturing costsVariable $170,000Fixed $30,000Selling and administrative costsVariable $80,000Fixed $20,000 Which is the break-even point in units for Kringel? (Points : 5)33,334 units100,000 units40,000 units200,000 unitsQuestion 8.8.(TCO 7) Which would be the most appropriate base for allocating the costs of the maintenance department? (Points : 5)Machine hoursDirect labor hoursNumber of employeesSquare feetQuestion 9.9.(TCO 7) Yo Department Store incurred $8,000 of indirect advertising costs for its operations. The following data have been collected for 2013 for its three departments.ShoesCosmeticsCraftsSales$120,000$100,000$100,000Direct advertising costs$9,000$7,000$4,000Newspaper ad space60%20%20%How much of the indirect advertising costs will be allocated to the Cosmetics Department if newspaper ad space is the activity driver?(Points : 5)$8,000$1,600$1,400$6,400Question 10.10.(TCO 5) Which best describes zero-base budgeting? (Points : 5)A budget that is developed for a single level of activityA budget that analyzes existing activities (and continuation of that activity must be justified and resources needed must be justified by each manager)A budget that is based solely on prior period information, adjusted for inflationA budget that is continuous or rollingQuestion 11.11.(TCO 5) Bug Company manufactures buggies. Manufacturing a buggy takes 20 units of wood and 1 unit of steel. Scheduled production of buggies for the next 2 months is 500 and 600 units, respectively. Beginning inventory is 4,000 units of wood and 30 units of steel. The ending inventory of wood is planned to decrease 500 units in each of the next 2 months, and the steel inventory is expected to increase 5 units in each of the next 2 months.How many units of wood are expected to be used in production during the second month?(Points : 5)12,500 units10,000 units15,000 units12,000 unitsQuestion 12.12.(TCO 4) Which statement is true? (Points : 5)Absorption costing net income exceeds variable costing net income when units produced and sold are equal.Variable costing net income exceeds absorption costing net income when units produced exceed units sold.Absorption costing net income exceeds variable costing net income when units produced are less than units sold.Absorption costing net income exceeds variable costing net income when units produced are greater than units soldQuestion 13.13.(TCO 6) Using more highly skilled direct laborers might affect which variance?(Points : 5)Direct materials usage varianceDirect labor efficiency varianceVariable manufacturing overhead efficiency varianceAll of the aboveQuestion 14.14.(TCO 6) Which equation measures the total budget variance? (Points : 5)AQ x (AP - SP).SP x (AQ - SQ).SQ x (AP - SP).(AQ x AP) - (SQ x SP).(TCO 1) George Corporation has an estimated monthly sales of 12,000 units for $80 per unit. Variable costs include manufacturing costs of $50 and distribution costs of $20. Fixed costs are $60,000 per month.Required:Determine each of the following values.a. Unit contribution marginb. Monthly break-even unit sales volume Create a contribution margin-based income statement.(Points : 30)Question 2.2.(TCO 7) Darling Manufacturing Inc. manufactures two products, A and B, from a joint process. A single production costs $5,000 and results in 200 units of A and 800 units of B. To be ready for sale, both products must be processed further, incurring seperable costs of $3 per unit for A and $4 per unit for B. The market price for Product A is $15 and for Product B is $10.Required: Allocate joint production costs to each product using the net realizable value method.(Points : 30)Question 3.3.(TCO 6) Santa Inc. manufactures toys based on the following information.Standard costsMaterials (4 ounces at $4)$16Direct labor (1 hour per unit)$7Variable overhead (based on direct labor hours)$3.50 Fixed overhead budget$16,000 Materials purchasedActual results and costsUnits10,000Cost$38,500Materials used in productionFinished product units2,200Raw material (ounces)9,500Direct labor hours2,200Direct labor cost$18,000Variable overhead costs$8,400Fixed overhead costs$16,200Required:Compute the following variances (show calculations).a. Materials usage varianceb. Labor rate variance-c. Fixed overhead budget variance(Points : 30)Question 4.4.(TCO 4) Toshi Company incurred the following costs in manufacturing desk calculators.Direct materials $14Indirect materials (variable) 4Direct labor 8Indirect labor (variable) 6Other variable factory overhead 10Fixed factory overhead 28Variable selling expenses 20Fixed selling expenses 14During the period, the company produced and sold 1,000 units. a. What is the inventory cost per unit using absorption costing? b. What is the inventory cost per unit using variable costing?(Points : 30)Question 5.5.(TCO 8) Musical Instruments Company manufactures two products (trumpets and trombones). Overhead costs ($175,000) have been divided into three cost pools that use the following activity drivers.ProductNumber of setupsMachine hoursPacking ordersTrumpets501,500150Trombones504,500250Cost per pool$60,000$90,000$25,000 Required (show all calculations) a. What is the allocation rate for trumpets per setup using activity-based costing? b. What is the allocation rate for trumpets per machine hours using activity-based costing?c. What is the allocation rate for trumpets per packing order using activity-based costing?(Points : 30) $25.00 Required: Prepare a performance report for all costs, showing flexible budget variances (indicate F or U).