STR Accounting Section A

Accounting Section




Accounting

Relevant cost

Theory of constraints

Special order

Make or buy

Transfer pricing

Sell or process further

Resource planning and analysis

Forecasting

Cash budgeting

Variance analysis

Cost-Volume-Profit (CVP) analysis

Cost behavior

Break-even analysis

Target profit

Product costing

Absorption vs. variable

Activity-based

Process vs. job-order

Standard

Byproduct

Financial reporting and analysis

Financial statements

Financial ratios

Regulatory environment





46. Which one of the following is a cost that would NOT likely be associated with computer-integrated manufacturing?

a. 0 Manufacturing overhead associated with allocation of equipment depreciation

b. 0 Direct labor costs of a welder on the production floor

c. 0 Manufacturing overhead associated with allocation of the plant lease to the latest production run

d. 0 Direct materials cost with several fuse plates for a new automobile



47. If a plant is operating at full capacity and receives a one-time opportunity to accept an order at a special price below its usual price, then

a. 0 only variable costs are relevant.

b. 0 fixed costs are not relevant.

c. 0 the order will likely be accepted.

d. 0 the order will likely be rejected.



48. Tex's Manufacturing Company can make 100 units of a necessary component part with the following costs:

Direct Materials $60,000

Direct Labor 10,000

Variable Overhead 30,000

Fixed Overhead 20,000



If Tex's Manufacturing Company purchases the component externally, $15,000 of the fixed costs can be avoided. At what external price for the 100 units is the company indifferent between making or buying?

a. 0 $120,000

b. 0 $85,000

c. 0 $115,000

d. 0 $100,000



49. Transfer prices should be set in such a way as to

a. 0 discourage the internal sales of goods and services

b. 0 reflect the actual costs, including opportunity costs, of the transfer

c. 0 eliminate profits on the transfer

d. 0 reflect market prices



51. Tucson Corporation has a joint process that produces three products: X, Y, and Z. Each product may be sold at split-off or processed further and then sold. Joint- processing costs for a year amount to $100,000. Other relevant data are as follows:



Separate Processing

Sales Value Costs after Sales Value

Product at Split off Split off at Completion



X $128,000 $16,000 $160,000

Y 75,000 26,000 99,000

Z 32,600 20,000 50,000



Once product X is produced, processing it further will cause profits to

a. 0 increase by $32,000

b. 0 decrease by $16,000

c. 0 decrease by $32,000

d. 0 increase by $16,000



51. A _____ gives the expected sales under a given set of conditions.

a. 0 sales prediction

b. 0 sales budget

c. 0 budget forecast

d. 0 sales forecast



52. The projection of financial position at the end of the budget period is found on the

a. 0 budgeted income statement

b. 0 cash budget

c. 0 budgeted balance sheet

d. 0 sales budget



53. Black Company planned to produce and sell 900 units at a total cost of $180,000. Actual production was 900 units at a cost of $170,000, Black Company was

a. 0 efficient

b. 0 inefficient

c. 0 effective

d. 0 ineffective



54. Cost behavior analysis applies to

a. 0 retailers

b. 0 wholesalers

c. 0 manufacturers

d. 0 all entities



55. A company sells a product which has a unit sales price of $5, a unit variable cost of $3, and total fixed costs of $120,000. The number of units the company must sell to break even is

a. 0 60,000 units

b. 0 24,000 units

c. 0 240,000 units

d. 0 40,000 units



56. The amount by which actual or expected sales exceeds break-even sales is referred to as

a. 0 contribution margin

b. 0 unanticipated profit

c. 0 margin of safety

d. 0 target net income



57. There is no difference between variable-costing and absorption-costing income if there is no

a. 0 beginning inventory

b. 0 ending inventory

c. 0 change in inventory level

d. 0 variable overhead cost





58. An example of an activity cost pool is

a. 0 machine hours

b. 0 setting up machines

c. 0 number of setups

d. 0 number of inspections



59. Which of these best reflects a distinguishing factor between a job order cost system and a process cost system?

a. 0 The detail at which costs are calculated

b. 0 The time period each covers

c. 0 The number of work in process accounts

d. 0 The manufacturing cost elements included



60. Identify which statement below about currently attainable standards is false

a. 0 They allow for normal spoilage and nonproductive time.

b. 0 Because they allow for waste, they usually result in favorable variances.

c. 0 They represent projections of what will probably be attained.

d. 0 Employees usually view these goals as resonable



61. Join costs are incurred

a. 0 before the production process is started

b. 0 before individual products are separately identified

c. 0 after the split-off point but before the process-further decision

d. 0 after the process-further decision



62. The ____________ is NOT one of the three major financial statements

a. 0 statement of cash flows

b. 0 income statement

c. 0 balance sheet

d. 0 statement of equity position



63. _____ are profitability ratios.

a. 0 Gross profit rate and return on sales

b. 0 Dividend payout and rate of return in invested capital

c. 0 Earnings per share and dividend yield

d. 0 Price earnings and current ratio



64. Which of the following statements is false regarding the Sarbanes-Oxley Act (SOX) of 2002?

a. 0 The Act calls for increased oversight responsibilities for boards of directors.

b. 0 The Act has resulted in increased penalties for financial fraud by top management.

c. 0 The Act calls for decreased independence of outside auditors reviewing corporate financial statements.

d. 0 The Act is meant to decrease the likelihood of unethical corporate behavior