ACCT 301 Midterm Exam
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ACCT 301 Midterm Exam 1
1. (TCO 1) Suppose your company sold $25,000 in merchandise to a customer for cash. How does this transaction impact the accounting equation? (Points : 12)
2. (TCO 2) Suppose your company sold $50,000 in merchandise to a customer for cash. How does this transaction impact the accounting equation? (Points : 12)
3. (TCO 3) Rationalization is one of the components of the fraud triangle. What types of rationalization could a person use to justify misconduct? How can a company protect itself from rationalization as a part of fraud? (Points : 12)
4. (TCO 4) What is horizontal analysis of financial statements? How does horizontal analysis differ from vertical analysis? (Points
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An assessment of this situation indicates
8. (TCO 3) The following information was taken from Hurlbert Company cash budget for the month of June:
9. (TCO 11) Managerial accounting information does which of the following?
10. (TCO 11) Which one of the following is not a direct material?
11. (TCO 11) Sales commissions are classified as which of the following?
12. (TCO 11) Manufacturing costs include which of the following?
13. (TCO 11) Neeley Manufacturing Company reported the following year-end information:
14. (TCO 5) What effect do changes in activity have on fixed costs per unit?
15. (TCO 5) Which one of the following is not an assumption of CVP analysis?
ACCT 301 Midterm Exam 3
1. (TCO 5) A company has total fixed costs of $210,000 and a contribution margin ratio of 30%. How much sales are necessary to break even?
2. (TCO 5) How much sales are required to earn a target income of $70,000, if total fixed costs are $100,000 and the contribution margin ratio is 40%?
3. (TCO 6) For which one of the following budgeting aspects does the budget committee generally have the responsibility?
4. (TCO 6) Under what situation might a budget be most effective?
5. (TCO 6) How does long-range planning compare to a master budget?
6. (TCO 6) Which one of the following is a source of information used to prepare the budgeted income statement?
7. (TCO 7) When is a static budget most appropriate in evaluating a manager’s performance?
8. (TCO 7)
Compares five to seven expense results with budget expectations and describes possible reason for variances and strategies to keep results aligned with expectations
13. If the selling price is $22 per unit, what is the contribution margin per unit sold?
This research paper is a brief discussion of budget management analysis. Budgeting is the key to financial management, and is the key to translates an organization goals or plan into money. Budgeting is a rough estimate of how much a company will need to get their work done, and provides the basis for evaluating performance, a source of motivation, coordinating business activities, a tool for management communication and instructions to employees. Without a budget an organization would be like a driver, driving blinded without instructions or any sense of direction, that’s how important a budget is to every organization and individual likewise (Clark, 2005).
Assume that next year management wants the company to earn a minimum profit of $162,000. How many units be sold to meet this target profit figure? [3 points]
In our second assumption, instead of using the cost of goods per cases in 1986, we try to use the percentage it counts in the total expenses which is 50.4% and to find the sales needed to break-even. The detail of the calculation is shown in the answer for questions d. The result is that 95,635, a little bit higher than the estimated sales of 90,000.
Basic concepts. Jean's Marine Supply specializes in the sale of boating equipment and accessories. Identify the items that follow as an asset (A), liability (L), revenue (R), or expense (E) from the firm's viewpoint.
1. The local Mastermind store sells innovative educational toys. Part of their service is giving advice to customers about the best toys for a particular age group, which requires having more customer service representatives in the store. During the month long Christmas buying season, it makes half of its $500,000 yearly sales. Its contribution margin on average is 40% and its fixed costs for the year are about $150,000. The owner believes that she could make even higher sales, if she had more customer service representatives on the floor during the peak season. She plans on hiring four more people for 200 hours each at $20 per hour. How much additional revenue does she have earn to the nearest dollar
Break-even Dollar Volume = Total Fixed Costs / Contribution Margin = $525,000 / 0.7111 = $738,282.40
If Marlene Herbert were to discontinue place mats, he would miss $270,000 that will go toward Mendel paper company fixed cost. The company currently has a plant overhead that is estimated at $420,000 for the quarter. In addition to the fixed plant overhead, the plant incurs fixed selling and administrative expenses per quarter of $118,000. This draws the company to a total fixed cost of $538,000. If Marlene Herbert were to discontinue the second highest contributor to the fixed cost, he would need to increase the volume of computer paper and lower material cost to help pull the contribution margin of the lowest product up to help support the lost of a whole product line.
A budget is an instrument used to help managers ensure that the resources used effectively and proficiently toward the goals of an organization. A budget projection can be made on a yearly base depending on previous year or existing one. They can further be broken down quarterly or monthly depending on it use. Generating a budget is complex undertaking, and for a budget to be effective the organization ought to follow it strictly. However, no matter how closely a business follows their guidelines there will always be some form of variances. The organization should expect a few variances and be able to work these discrepancies in any budget
A company's budget serves as a guideline in planning and committing costs in order to meet tactical and strategic goals. Tactical goals such as providing budgetary costs for daily operations, and strategic objectives that include R&D, production, marketing, and distribution are all part of the budgeting process. Serving as a guideline rather than being set in stone, the budget is a snapshot of manager's "best thinking at the time it is prepared." (Marshall, 2003, p.496) The budget is a method in which to reign-in discretionary spending, and will likely show variances between what costs have been anticipated and what costs are actually incurred.
d) If Tyler is estimating a gross profit margin, or contribution margin, of 40 percent, how much of the receivables balance must actually
a. Assuming the most current operational cost levels, what sales must it generate to recoup the above investment?
Answer the following questions using the information below:The following information is for the Jeffries Corporation: Product A: Revenue $16.00 Variable Cost $12.00 Product B: Revenue $24.00 Variable Cost $16.00 Total fixed costs $75,000If the sales mix shifts to four units of Product A and one unit of Product B, then the weighted-average contribution margin will:
Break Even Point in Sales = (Total Fixed Costs + Target Profit) ÷ Contribution Margin Ratio