ACCT 346 Midterm Exam

ACCT 346 Midterm Exam

1.
(TCO 4) Which of the following will have no effect on the break-even point in
units?

2.
(TCO 4) Circle K Furniture has a contribution margin ratio of 16%. If fixed
costs are $176,800, how many dollars of revenue must the company generate in
order to reach the break-even point?)

3.
(TCO 4) Paula Corporation sells a single product at a price of $275 per unit.
Variable cost per unit is $135 and fixed costs total $356,860. If sales are
expected to be $825,000, what is Paula’s margin of safety?

4.
(TCO 5) Which of the following is treated differently in full costing than in
variable costing?

5.
(TCO 5) Which of the following items on a variable costing income statement
will change in direct proportion to a change in sales?

6.
(TCO 5) Peak Manufacturing produces snow blowers. The selling price per snow
blower is $100. Costs involved in production are:

7.
(TCO 5) The cost objective is the

8.
(TCO 6) Which of the following statements about cost pools is not true?

9.
(TCO 6) AC Consulting Company has purchased a new $18,038 copier. This overhead
cost will be shared by the purchasing, accounting, and information technology
departments since those are the only departments which will be able to access
the machine. The company has decided to allocate the cost based on the number
of copies made by each department. Each department has estimated the number of
copies which will be made over the life of the copier

10. (TCO 7) A company is trying to decide whether to keep or
drop the sporting goods department in its department store. If the segment is
dropped, the manager will be fired. The manager’s salary, in relation to the
decision to keep or drop the sporting goods department, is

11. (TCO 7) BigByte Company has 12 obsolete computers that are
carried in inventory at a cost of $13,200. If these computers are upgraded at a
cost of $7,500, they could be sold for $15,300. Alternatively, the computers
could be sold “as is” for $9,000. What is the net advantage or
disadvantage of reworking the computers?

12. (TCO 7) YXZ Company’s market for the Model 55 has changed
significantly, and YXZ has had to drop the price per unit from $275 to $135.
There are some units in the work in process inventory that have costs of $160
per unit associated with them. YXZ could sell these units in their current
state for $100 each. It will cost YXZ $10 per unit to complete these units so
that they can be sold for $135 each. Which of the following is the amount of
sunk costs in this problem?

13. (TCO 3) Which of the following companies is most likely to
use a process costing system?
14. (TCO 3) The Blending Department began the period with
45,000 units. During the period the department received another 30,000 units
from the prior department and completed 60,000 units during the period. The
remaining units were 75% complete. How much are equivalent units in The
Blending Department’s work in process inventory at the end of the period?

15. (TCO 4) Total costs were $75,800 when 30,000 units were
produced and $95,800 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.