Keller ACCT 505 Final Exam Answers

Keller ACCT 505 Final Exam Answers

BUY HERE⬊

http://mxstudent.com/keller-acct-505-final-exam-answers/

Keller ACCT 505 Final Exam Answers

(CO F) Bella Lugosi Holdings, Inc. (BLH), has collected the following operating information for its current month's activity. Using this information, prepare a flexible budget analysis to determine how well BLH performed in terms of cost control.
 

	Actual Costs Incurred	Static Budget
Activity level (in units)	5,250	5,178
Variable costs:
Indirect materials	$24,182	$23,476
Utilities	$22,356	$22,674
Fixed costs:
Administration	$63,450	$65,500
Rent	$65,317	$63,904

(CO H) McMullen Co. uses 10,000 units of Part X each year as a component in the assembly of one of its products. The company is presently producing Part X internally at a total cost of $125,000 as follows.

Direct materials	$40,000
Direct labor	30,000
Variable manufacturing overhead	25,000
Fixed manufacturing overhead	30,000
Total costs	$125,000

An outside supplier has offered to provide Part X at a price of $10 per unit. If McMullen stops producing the part internally, one third of the fixed manufacturing overhead would be eliminated.
 
Required: Prepare a make-or-buy analysis showing the annual advantage or disadvantage of accepting the outside supplier's offer. Please state clearly whether the part should be made or bought and share your work.

(CO D) Duif Company's absorption costing income statement for the last year of operations is presented below. 
 

Sales	$70,000
Less cost of goods sold:
Beginning inventory	0
Add cost of goods manufactured	48,000
Goods available for sale	48,000
Less ending inventory	6,000
Cost of goods sold	42,000
Gross margin	28,000
Less selling and admin. expenses	25,000
Net operating income	3,000

 
Data on units produced and sold for the year are given below.
Units in beginning inventory     0
Units produced     8,000
Units sold     7,000
 
Variable manufacturing costs are $4 per unit. Fixed manufacturing overhead totaled $16,000 for the year. The fixed manufacturing overhead was applied to products at a rate of $2 per unit. Variable selling and administrative expenses were $3 per unit sold:
 
Required: Prepare a new income statement for the year using variable costing. Comment on the differences between the absorption costing and the variable costing income statements.

(CO E) Designing a new product is a(n)

(CO G) Given the following data, what would ROI be? 

(CO I) (Ignore income taxes in this problem.) Bill Anders retires in 8 years. He has $650,000 to invest and is considering a franchise for a fast-food outlet. He would have to purchase equipment costing $500,000 to equip the outlet and invest an additional $150,000 for inventories and other working capital needs. Other outlets in the fast-food chain have an annual net cash inflow of about $160,000. Mr. Anders would close the outlet in 8 years. He estimates that the equipment could be sold at that time for about 10% of its original cost. Mr. Anders' required rate of return is 16%. 
 
Required:
Part A: What is the investment's net present value when the discount rate is 16%? 
Part B: Refer to your calculations. Is this an acceptable investment?  Why or why not?

(CO C) Aziz Corporation produces and sells a single product. Data concerning that product appear below.
 

Selling price per unit	$110.00
Variable expense per unit	$38.50
Fixed expense per month	$85,800

 
Required: Determine the monthly breakeven in either unit or total dollar sales. Show your work!

(CO B) Escatel Corporation bases its predetermined overhead rate on the estimated labor hours for the upcoming year. Data for the most recently completed year appear below. 

(CO B) Carter Corporation uses the weighted-average method in its process costing system. Data concerning the first processing department for the most recent month are listed below.
 
Work in process, beginning:

Units in beginning work-in-process inventory	600
Materials costs	$6,900
Conversion costs	$2,500
Percentage complete for materials	80%
Percentage complete for conversion	15%
Units started into production during the month	6,300
Units transferred to the next department during the month	5,800
Materials costs added during the month	$112,500
Conversion costs added during the month	$210,300

(CO A) The following data (in thousands of dollars) have been taken from the accounting records of Karmana Corporation for the just-completed year. 
 

Sales	$1950
Raw materials inventory, beginning	$50
Raw materials inventory, ending	$30
Purchases of raw materials	$360
Direct labor	$120
Manufacturing overhead	$175
Administrative expenses	$100
Selling expenses	$140
Work-in-process inventory, beginning	$50
Work-in-process inventory, ending	$70
Finished goods inventory, beginning	$200
Finished goods inventory, ending	$105

 
Use these data to prepare (in thousands of dollars) a schedule of Cost of Goods Manufactured and a Schedule of Cost of Goods Sold for the year. In addition, elaborate on the relationship between these schedules as they relate to the flow of product costs in a manufacturing company.

(CO F) Matuseski Corporation is preparing its cash budget for October. The budgeted beginning cash balance is $54,000. Budgeted cash receipts total $127,000 and budgeted cash disbursements total $99,000. The desired ending cash balance is $100,000. The company can borrow up to $150,000 at any time from a local bank, with interest not due until the following month. 
 
Required: Prepare the company's cash budget for October in good form. Make sure to indicate what borrowing, if any, would be needed to attain the desired ending cash balance.