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##### UMUC MGMT640 final exam part 1

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Question;UMUC MGMT640 final exam part 1;1.;A typical use of;managerial accounting is to;A);Help investors and;creditors to assess the financial position of the company.;B);Help management get a;clean audit report.;C);Help the SEC decide;whether management is in compliance with its policies.;D);Help the marketing manager decide which product;promotion to implement.;Q2;Three costs incurred by Pitt Company are summarized;below;1,000 units;2,000 units;Cost;A;$10,000;$15,000;Cost;B;$21,000;$21,000;Cost;C;$16,000;$32,000;Which of these costs are;variable?;3. Bubba?s steakhouse has budgeted the following costs for a;month in which 1,600 steak dinners will be sold: Materials, $4,080, hourly;labor (variable), $5,200, rent (fixed), $1,720, depreciation, $600, and other;fixed costs, $550. Each dinner sells for $12.60. How much would Bubba?s profit;increase if 10 more dinners were sold?;A) $68.;B) $72.;C) $52.;D) $126.;Q4 Bellfont Company produces;door stoppers. August production costs are below;Door Stoppers;produced 74,000;Direct material;(variable);$20,000;Direct labor;(variable);40,000;Supplies;(variable);20,000;Supervision;(fixed) 27,400;Depreciation;(fixed);21,000;Other;(fixed) 4,800;In September, Bellfont expects to produce 100,000 door stoppers.;Assuming no structural changes, what is Bellfont?s production cost per door;stopper for September?;Q5;Aaron's chairs is in the process of preparing a production;cost budget for August. Actual costs in July for 120 chairs were;Materials cost;$4,820;Labor cost;2,560;Rent;1,500;Depreciation;2,500;Other fixed costs;3,200;Materials and labor are the only variable costs. If;production and sales are budgeted to increase to 130 chairs in August, how much;is the expected total variable cost on the August budget?;Q-6;Carry-ALL plans to sell 1,300 carriers next year and has;budgeted sales of $46,000 and profits of $22,000. Variable costs are projected;to be $20 per unit. Michael Co. offers to pay $24,300 to buy 520 units from;Carry-ALL. Total fixed costs are $7,000 per year. This offer does not affect;Carry-ALL's other planned operations. The incremental revenues for this;situation are;Q7;Stellar Company has the following sales, variable cost, and;fixed cost. If sales increase by $10,000 then their profit increases/decreases;by how much?;Sales $50,000;Variable Costs $7,300;Fixed Costs $25,000;Q8;Susan is trying to decide whether or not to attend college;during the next 12-week session. She has the following options;1. Attend college full-time at a cost of $1,200.;2. Attend college part-time at a cost of $600 and work;part-time earning $1,600.;3. Work full-time earning $4,900.;What is Susan's incremental profit if she chooses option 3;over option 2?;Q9;Total cost were $74,300 when 27,000 units were produced and;$99,000 when 40,000 units were produced. Use the high-low method to find the estimated;total costs for a production level of 32,000 units.;Q10;Professional University teaches a large range of;undergraduate courses. It is interested in determining the cost equation for;the facilities cost as a function of student credit hours so that it an more;accurately budget its facilities costs as enrollment grows. Information for the;high and low cost semesters and volumes for last 5 years appears below;Semester;Student Credit Hours Facilities Cost;Spring;2007 250,000 $500,000;Fall;2004 300,000 $530,000;Using;the high low method, with student credit hours as the activity driver, what is;the equation for facilities cost (FC) as a function of student credit hours?;Q11;Randy's tireland makes a product that sells for $61 per unit;and has $50 per unit in variable costs. Annual fixed costs are $24,000. If;Rambles sells 10 units less than breakeven, how much loss would the company;recognize on its income statement?;Q12;Ritz Furniture has a contribution margin ratio of 0.17. If;fixed costs are $165,000, how many dollars of revenue must the company generate;in order to reach the break-even point?;Q13;U.S. Telephone Cellular sells phones for $100. The unit;variable cost per phone is $50 plus a selling commission of 10% (based on the;unit sales price per phone). Fixed manufacturing costs total $1,010 per month;while fixed selling and administrative costs total $2,200. How many phones must;be sold to achieve the breakeven point?;Q14;Swimkids is a swimsuit manufacturer. They sell swim suits at;a selling price is $30 per unit. Swimkids variable costs are $18 per unit.;Fixed costs are $71,200. Swimkids expects sales of $262,800 next year. What is;Swimkids's margin of safety?;Q15;Lambardi Company sells 3 types of bags. Bag A sells for $17;and has variable cost of $9.00 per unit. Bag B sells for $14 and has variable;cost of $12.00 per unit. Bag C sells for $8 and has variable costs of $6.00 per;unit. Lambardi sells in a mix of 2 units of A, 3 units of B and 5 units of C.;What is the weighted average contribution margin per unit for Lambardi?;Q16;Product A has a contribution margin per unit of $500 and;required 2 hours of machine time. Product B has a contribution margin per unit;of $1,000 and requires 5 hours of machine time. How much of each product should;be produced given there are 100 hours of available machine time?;Q17;Delfi Company produces two;models of buckets, Tonto and Pronto. Information regarding these products for;May follows;Tonto Pronto;Number of units 3,000 7,000;Sales revenue $120,000 $140,000;Variable costs 60,000 42,000;Fixed costs 24,000 50,000;Net Income $36,000 $48,000;Pounds of plastic to produce one;bucket 4.0 1.6;Contribution margin per unit $20 $14;Due to increased demand of plastic in;the market, Delfi Company can obtain only 9,000 pounds of plastic per month. Delfi;can sell as many buckets as it can produce of either model. How many of each;model should Delfi produce to maximize profit in May considering the constraint?;Tonto: 2,250, Pronto: 0;Tonto: 0, Pronto: 5,625;Tonto: 0, Pronto: 4,375;Tonto: 1,125, Pronto: 2,812;Solution;Q18;Aberdeen Corp. uses;activity-based costing system with three activity cost pools. The following;information is provided;Costs: Wages and salaries $ 220,000;Depreciation 120,000;Utilities 100,000;Total $440,000;Activity Cost Pools;Assembly Setting Up Other Total;Wages and salaries 60% 30% 10% 100%;Depreciation 35% 45% 20% 100%;Utilities 30% 40% 30% 100%;How much total cost would be;allocated to the Assembly activity cost pool?;A. $204,000;B. $174,000;C. $440,000;D. $162,000

Paper#49042 | Written in 18-Jul-2015

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