Question 1 (5 points)
Joe's Tuxedos has monthly fixed costs of $12,000. The variable costs of sales are 60%. What is the breakeven monthly sales revenue?
A) $20,000
B) $30,000
C) 19,200
D) $7,200
Question 2 (5 points)
Delta Manufacturing has sales of $2,000,000 with direct materials cost of $400,000, direct labor of $280,000, variable overhead of $120,000, and fixed costs of $300,000. What is Delta's contribution margin percentage?
A) 40%
B) 55%
C) 60%
D) 45%
Question 3 (5 points)
If a company has a 45% contribution margin ratio and has fixed costs of $250,000, how much sales does it need to earn a gross profit of $200,000?
A) $1,000,000
B) $555,556
C) $818,182
D) $652,500
Question 4 (5 points)
Leisure Products management wants to ensure that each product makes a profit. The company produced a hammock that sold 3,500 units at $80 per unit. The variable cost of production was $36 per unit. The fixed costs were $110,000. What was the margin of safety?
A) $54,000
B) $80,000
C) $126,000
D) $20,000
Question 5 (5 points)
Oregon State Lumber Inc. purchased and used 126,000 board feet of lumber in production, at a total cost of $1,449,000. Original production had been budgeted for 22,000 units with a standard material quantity of 5.5 board feet per unit and a standard price of $12 per board foot. Actual production was 23,000 units.
Compute the material price variance.
A) $63,000 F
B) $63,000 U
C) $6,000 F
D) $6000 U
Question 6 (5 points)
Please review the following information involving labor costs for the current period:
Standard costs 
9,000 hours at $5.50 
Actual costs 
8,750 hours at $5.75 
Compute the direct labor rate variance?
A) $2,250.00 unfavorable
B) $2,187.50 unfavorable
C) $1,438.00 favorable
D) $1,375.00 favorable
Question 7 (5 points)
Roscoe Enterprises has sales for a threemonth period as follows: May, $240,000; June, $280,000; July, $275,000. All sales are on account, and history has shown that accounts receivable are typically collected 10% in the month of the sale, 60% in the month after the sale, and 30% two months after the sale. What are Roscoe's expected cash collections in the month of July?
A) $267,500
B) $172,000
C) 275,000
D) $280,000
Question 8 (5 points)
Mega Manufacturing has a budget to sell 100,000 units of a certain product at a selling price of $35 per unit. Variable costs for materials, labor, and overhead are $18 per unit. Fixed cost is $800,000. Actual sales were 110,000 units, and management would like to see actual manufacturing performance compared to a budget adjusted for volume (flexible budget). What would be the adjusted budgeted operating profit?
A) $1,870,000
B) $900,000
C) $1,070,000
D) $990,000
Question 9 (5 points)
A company president wants the chief financial officer to tell him how many sales are required to make a $1,000,000 operating profit. Variable production costs are 70% of sales, and fixed costs are $2,750,000. What are the required sales, rounded to the closest dollar?
A) $8,750,000
B) $5,357,143
C) $9,166,667
D) $12,500,000
Question 10 (5 points)
Top Dog Company has a budget with sales of 5,000 units and $3,200,000. Variable costs are budgeted at $1,750,000, and fixed overhead is budgeted at $900,000. What is the budgeted manufacturing cost per unit?
A) $350
B) $530
C) $640
D) $460
Question 11 (5 points)
Zarena was reviewing the water bill for her dog day care and spa and determined that her highest bill, $3,800, occurred in May when she washed 400 dogs and her lowest bill, $2,400, occurred in November when she washed 200 dogs. What was the variable cost per dog associated with Zarena’s water bill?
A) $6.00
B) $12.00
C) $9.50
D) $7.00
Question 12 (5 points)
Alaska King Crabs Inc. has provided the following information for the month of December:

King Crabs 
King Crab Legs 
Estimated beginning inventory 
30,000 units 
18,000 units 
Desired ending inventory 
32,000 units 
15,000 units 
Region I, anticipated sales 
320,000 units 
260,000 units 
Region II, anticipated sales 
190,000 units 
130,000 units 
The unit selling price for product King Crabs is $5 and for product King Crab Legs is $14. Budgeted sales for the month are:

A) $2,040,000 

B) $4,680,000 

C) $6,692,000 

D) $8,010,000 0715957606 
Question 13 (5 points)
Vatsala sells handknit scarves at the flea market. Each scarf sells for $25.Vatsala pays $30 to rent a vending space for one day. The variable costs are $15 per scarf. What total revenue amount does she need to earn to break even?

A) $85 

B) $75 

C) $50 

D) $100 
Question 14 (5 points)
Brielle Company sells glass vases at a wholesale price of $2.50 per unit. The variable cost of manufacture is $1.75 per unit. The monthly fixed costs are $7,500. Brielle’s current sales are 25,000 units per month. If Brielle wants to increase operating income by 20%, how many additional units, must Brielle sell? (Round your intermediate calculations to two decimal places)

A) 145,000 glass vases 

B) 7,500 glass vases 

C) 13,500 glass vases 

D) 3,000 glass vases 
Question 15 (5 points)
Venkat Company has provided the following information regarding the two products that it sells:
Jet Boats Ski Boats
Sales Price per unit $8000 $20000
Variable Cost per unit 4800 14000
Annual fixed costs are $280,000.
How many units must be sold in order for Venkat to breakeven, assuming that Venkat sells five jet boats for every two ski boats sold?

A) 70 jet boats and 28 ski boats 

B) 50 jet boats and 20 ski boats 

C) 20 jet boats and 50 ski boats 

D) 45 jet boats and 28 ski boats 
Question 16 (5 points)
White Marsh Company has prepared the following sales budget:
Month Budgeted Sales
March $200,000
April 180,000
May 220,000
June 260,000
Cost of goods sold is budgeted at 60% of sales and the inventory at the end of February was $36,000. Desired inventory levels at the end of each month are 20% of the next month's cost of goods sold. What is the desired beginning inventory on June 1?

A) $52,000 

B) $26,400 

C) $43,200 

D) $31,200 
Question 17 (5 points)
EZ Financing Inc. has prepared the operating budget for the first quarter of 2015. They forecast sales of $50,000 in January, $60,000 in February, and $70,000 in March. Variable and fixed expenses are as follows:
Variable: Power cost (40% of Sales)
Miscellaneous expenses: (5% of Sales)
Fixed: Salary expense: $8,000 per month
Rent expense: $5,000 per month
Depreciation expense: $1,200 per month
Power cost/fixed portion: $800 per month
Miscellaneous expenses/fixed portion: $1,000 per month
Calculate total selling and administrative expenses for the month of January.

A) $38,500 

B) $47,500 

C) $41,700 

D) $43,000 
Question 18 (5 points)
Mumbai Inc. has prepared the following purchases budget:
Month Budgeted Purchases
JUNE $67,000
JULY 72,500
AUGUST 76,300
SEPTEMBER 73,700
OCTOBER 69,200
All purchases are paid for as follows: 10% in the month of purchase, 50% in the following month, and 40% two months after purchase. Calculate total cash payments made in October for purchases.

A) $72,630 

B) $70,680 

C) $70,520 

D) $74,290 
Question 19 (5 points)
Mumbai Inc. has prepared the following purchases budget:
Month Budgeted Purchases
JUNE $67,000
JULY 72,500
AUGUST 76,300
SEPTEMBER 73,700
OCTOBER 69,200
All purchases are paid for as follows: 10% in the month of purchase, 50% in the following month, and 40% two months after purchase. Calculate balance of Accounts payable at the end of October.

A) $77,680 

B) $91,760 

C) $69,330 

D) $74,290 
Question 20 (5 points)
The budgeted production of Fells Point Inc. is 8,000 units. Each unit requires 40 minutes of direct labor work to complete. The direct labor rate is $100 per hour. Calculate the budgeted cost of direct labor for the month.

A) $533,333.33 

B) $500,000.00 

C) $566,666.66 

D) $633,333.33 