Computation Problems of a Companies - Assignment Example

5: Natraj Corporation uses the weighted-average method in its process costing system. Operating data for the Lubricating Department for October appear below:   Units Percent Complete with Respect to Conversion Beginning work in process inventory   5,400 20% Transferred in from the prior department during October 38,100 Completed and transferred to the next department in October 37,800 Ending work in process inventory   5,700 60%   What were the equivalent units for conversion costs in the Lubricating Department for October?   (a) 41,220 (b) 38,400 (c) 37,800 (d) 41,520   In the department’s cost reconciliation report for September, the total cost accounted for would be:   (a) $619,000 (b) $644,000 (c) $322,000 (d) $43,000 Answer = C   13: Blackwelder Snow Removal’s cost formula for its vehicle operating cost is $1,240 per month plus $348 per snow day. For December, the company planned for activity of 12 snow days, but the actual level of activity was 14 snow days. The actual vehicle operating cost for the month was $6,330. The vehicle operating cost in the planning budget for December would be closest to:   (a) $5,426 (b) $6,112 (c) $5,416 (d) $6,330 Answer = C     14: Ofarrell Snow Removal’s cost formula for its vehicle operating cost is $1,840 per month plus $377 per snow day. For November, the company planned for activity of 14 snow days, but the actual level of activity was 19 snow days. The actual vehicle operating cost for the month was $9,280. The vehicle operating cost in the flexible budget for November would be closest to:   (a) $9,003 (b) $7,118 (c) $9,280 (d) $9,660 Answer = A   15: Raymond Electronics Corporation has a standard cost system in which it applies manufacturing overhead to products based on standard machine hours (MHs). The company had budgeted its fixed manufacturing overhead cost at $42,700 for the month and its level of activity at 2,000 MHs. The actual total fixed manufacturing overhead was $44,100 for the month and the actual level of activity was 1,800 MHs. What was the fixed manufacturing overhead budget variance for the month to the nearest dollar?   (a) $5,670 favorable (b) $1,400 favorable (c) $5,670 unfavorable (d) $1,400 unfavorable Answer = D 21: Glassett Corporation is considering a project that would require an investment of $62,000. No other cash outflows would be involved. The present value of the cash inflows would be $70,060. The profitability index of the project is closest to:   (a) 0.13 (b) 1.13 (c) 0.87 (d) 0.12 Answer = B 23: An increase in the accumulated depreciation account of $50,000 over a year would be shown on the company’s statement of cash flows prepared under the indirect method as:   (a) An addition to net income of $50,000 to arrive at net cash provided by operating activities (b) A deduction from net income of $50,000 to arrive at net cash provided by operating activities (c) An addition of $50,000 under investing activities (d) A deduction of $50,000 under investing activities Answer = A   Read More