NAME:______
ACCTG 481
Midterm #2 - Fall 2015
When complete, email to
Please show your work for credit
1.Alpha Corporation has provided the following cost data for last year:
100,000 units were produced and sold during the year. All costs are variable except for $100,000 of manufacturing overhead and $100,000 of selling and administrative expense. There are no beginning or ending inventories. If the selling price is $10 per unit, the net operating income from producing and selling 110,000 units would be:
2.Bravo Inc. had the following income statement for the most recent year:
Given this data, the unit contribution margin was:
3.Charlie Corporation produces and sells a single product. They havethis data for January.
If the company sells 3,100 units, its total contribution margin should be closest to:
4.Dimitri Corporation produces and sells a single product, and has this data for July:
If the company sells 6,900 units, its net operating income should be closest to:
5.Elaine Company’s contribution margin ratio is 25% and the break-even point in sales dollars is $200,000. To obtain a target net operating income of $60,000, sales would have to be:
6.Frank Company's variable expenses are $4.50 per unit, its selling price is $7.50 per unit and its fixed expenses total $150,000. The break-even point in units is:
7.Gamma Ltd. sells a single product for $20 per unit. If variable expenses are $12.00 and fixed expenses total $9,600, the break-even point IN DOLLARS will be:
8.Horstmann & Company's variable expenses are 55% of sales. At a $400,000 sales level, the degree of operating leverage is 5. If sales increase by $30,000, the new degree of operating leverage will be (rounded):
9.Innovation, Inc. sells three products with data as follows:
What would the contribution margin ratio % for the WHOLE COMPANY be?
10.Jade, Inc. sells a product for $10 per unit. The variable expenses are $6 per unit, and the fixed expenses total $35,000 per period. If sales increase by $40,000, how much will net operating income change?
11.Kilmer Corporation produces a single product and has the following cost structure:
The ABSORPTION COSTING unit product cost is:
12.Luminous Manufacturing produces a single product and has provided the following data for the month:
What is the total period cost for the month under ABSORPTION COSTING?
13.MegaManufacturing Inc. produces a single product and has provided the following data concerning its most recent month of operations:
What is the VARIABLE COSTING unit product cost for the month?
14.Nancy Inc. Manufactures a single product and has provided the following data concerning its most recent month of operations:
What is the total period cost for the month under VARIABLE COSTING?
15.Oliver Corporation produces a single product. During July, Roy produced 10,000 units. Costs incurred during the month were as follows:
Under ABSORPTION COSTING, any unsold units would be carried in the inventory account at a unit product cost of:
16.Pierre Products manufactures a single product and has provided the following data concerning its most recent month of operations:
What is the net operating income for the month under VARIABLE COSTING?
17.Quo-Stat Ltd, a manufacturer with a single product,has provided the following data:
What is the net operating income for the period under ABSORPTION COSTING?
18.Robertson Manufacturing Ltd. has a single product and has provided the following data:
The total gross margin for the period under ABSORPTION COSTING is:
19.Shepperton & Company produces a single product. Last year, fixed manufacturing overhead was $30,000, variable production costs were $48,000, fixed selling and administration costs were $20,000, and variable selling and administrative expenses were $9,600. There was no beginning inventory. During the year, 3,000 units were produced and 2,400 units were sold at a price of $40 per unit. Under VARIABLE COSTING, net operating income would be:
20.Last year, Tetski Corporation's variable costing net operating income was $63,600 and its inventory decreased by 600 units. Fixed manufacturing overhead cost was $1 per unit. What was the ABSORPTION COSTING net operating income last year?
21.Budgeted sales in Ullman Company over the next four months are given below:
Twenty-five percent of the company's sales are for cash and 75% are on account. Collections for sales on account follow a stable pattern as follows: 50% of a month's credit sales are collected in the month of sale, 30% are collected in the month following sale, and 15% are collected in the second month following sale. The remainder are uncollectible. Given these data, cash collections for December should be:
22.The ValentinoCorporation expects sales to be 60,000 units in April, 75,000 units in May and 70,000 units in June. The company desires that the inventory on hand at the end of each month be equal to 40% of the next month's expected unit sales. Due to excessive production during March, on March 31 there were 25,000 units in the ending inventory. Given this information, the company's production for the month of April should be:
23.Walsh Company has budgeted production for next year as follows:
Two pounds of material are required for each unit produced. The company has a policy of maintaining a stock of material on hand at the end of each quarter equal to 25% of the next quarter's production needs for material. A total of 30,000 pounds of material are on hand to start the year. Budgeted purchases of material for the second quarter would be:
24.Xaviera Corporation is working on its direct labor budget for the next two months. Each unit of output requires 0.77 direct labor-hours. The direct labor rate is $11.20 per direct labor-hour. The production budget calls for producing 7,100 units in October and 6,900 units in November. The company guarantees its direct labor workers a 40-hour paid work week. With the number of workers currently employed, that means that the company is committed to paying its direct labor work force for at least 5,480 hours in total each month even if there is not enough work to keep them busy. What would be the total combined direct labor cost for the two months?
25.Yorrick Inc. bases its manufacturing overhead budget on budgeted direct labor-hours. The direct labor budget indicates that 8,100 direct labor-hours will be required in May. The variable overhead rate is $1.40 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $100,440 per month, which includes depreciation of $8,910. All other fixed manufacturing overhead costs represent current cash flows. The May cash disbursements for manufacturing overhead on the manufacturing overhead budget should be:
NAME:______
26. (5 Points) Show your work for credit
The manufacturing overhead budget of ZoooooommmInc. is based on budgeted direct labor-hours. The June direct labor budget indicates that 5,800 direct labor-hours will be required in that month. The variable overhead rate is $7.70 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $111,360 per month, which includes depreciation of $17,400. All other fixed manufacturing overhead costs represent current cash flows.
Required:
a. Determine the cash disbursement for manufacturing overhead for June.
b. Determine the predetermined overhead rate for June.