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Analysis reveals that a company had a net decrease in cash of $4,000 for the current year. Net cash provided by operating activities was $18,000; net cash used in investing activities was $10,000 and net cash used in financing activities was $12,000. If the year-end cash balance is $21,000, the beginning cash balance was:

  1. $3,000.
  2. $7,000.
  3. $17,000.
  4. $25,000.
  5. $39,000.

 

Question 12

At the beginning of the recent period, there were 900 units of product in a department, one-third completed. These units were finished and an additional 5,000 units were started and completed during the period. 800 units were still in process at the end of the period, one-fourth completed. Using the weighted average method, the equivalent units produced by the department were:

  1. 5,000 units.
  2. 5,900 units.
  3. 6,100 units.
  4. 5,500 units.
  5. 6,700 units.

Question 13         

Austin Company uses a job order cost accounting system. The company's executives estimated that direct labor would be $2,000,000 (200,000 hours at $10/hour) and that factory overhead would be $1,500,000 for the current period. At the end of the period, the records show that there had been 180,000 hours of direct labor and $1,200,000 of actual overhead costs. Using direct labor hours as a base, what was the predetermined overhead allocation rate?

  1. $6.00 per direct labor hour.
  2. $7.50 per direct labor hour.
  3. $6.67 per direct labor hour.
  4. $8.33 per direct labor hour.
  5. $7.08 per direct labor hour.

 

 

Question 14         

Bok Company's output for the current period was assigned a $400,000 standard direct labor cost. The direct labor variances included a $10,000 unfavorable direct labor rate variance and a $4,000 favorable direct labor efficiency variance. What is the actual total direct labor cost for the current period?

  1. $414,000.
  2. $386,000.
  3. $394,000.
  4. $406,000.
  5. $410,000.

Question 15         

Bradford Company budgeted 4,000 pounds of material costing $5.00 per pound to produce 2,000 units. The company actually used 4,500 pounds that cost $5.10 per pound to produce 2,000 units. What is the direct materials quantity variance?

  1. $400 unfavorable.
  2. $450 unfavorable.
  3. $2,500 unfavorable.
  4. $2,550 unfavorable.
  5. $2,950 unfavorable.

Question 16         

Cabot Company collected the following data regarding production of one of its products. Compute the direct labor efficiency variance.

Direct labor standard (2 hrs. @ $13 / hr.)                                               $ 26 per finished unit

Actual direct labor hours                                                                               81,000 hrs

Actual finished units Produced                                                                  40,000 units

Actual cost of direct labor                                                                             $ 1,093,500

 

  1. $13,000 favorable.
  2. $40,500 favorable.
  3. $53,500 favorable.
  4. $13,000 unfavorable.
  5. $40,500 unfavorable.

 

 

Question 17         

Calculate the cost of goods manufactured using the following information:

Direct materials                                                                $ 298,500

Direct labor                                                                         132,000

Factory overhead                                                            264,000

General and administrative expenses                    85,500

Selling expenses                                                              48,800

Goods in process inventory, January 1                   118,500

Goods in process inventory, December 31           125,900

Finished goods inventory, January 1                        232,100

Finished goods inventory, December 31                                238,700

  1. $680,500.
  2. $701,900.
  3. $687,100.
  4. $674,600.
  5. $772,600.

 

 

 

Question 18         

Conan Company has total fixed costs of $112,000. Its product sells for $35 per unit and variable costs amount to $25 per unit. Next year Conan Company wishes to earn a pretax income that equals 10% of fixed costs. How many units must be sold to achieve this target income level?

  1. 1,120.
  2. 8,214.
  3. 11,200.
  4. 12,320.
  5. 14,080.

Question 19         

During its most recent fiscal year, Simon Enterprises sold 200,000 electric screwdrivers at a price of $15 each. Fixed costs amounted to $400,000 and pretax income was $600,000. What amount should have been reported as variable costs in the company's contribution margin income statement for the year in question?

  1. $2,400,000.
  2. $1,600,000.
  3. $3,000,000.
  4. $2,000,000.
  5. $1,000,000.

Question 20         

Edgar Company is considering the purchase of new equipment costing $80,000. The projected annual after-tax net income from the equipment is $10,200, after deducting $20,000 for depreciation. The revenue is to be received at the end of each year. The machine has a useful life of 4 years and no salvage value. Edgar requires a 10% return on its investments. The present value of an annuity of 1 and present value of an annuity for different periods is presented below. Compute the net present value of the machine.

   Period’s            Present value                    Present value of an annuity of

                                Of 1 at 10%                                         `1 at 10%

  1.                 0.9091                                                   0.9091
  2.                 0.8264                                                   1.7355
  3.                 0.7513                                                   2.4869
  4.                 0.6830                                                   3.1699

 

  1. $(15,731).
  2. $(4,896).
  3. $15,731.
  4. $4,896.
  5. $32,334.

 

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