Business Finance Homework Help

During FY 2020, Adelphi Company reported sales of $400,000, a contribution margin of $5.00 per unit, fixed costs of $130,000, and net income of $25,000. Use this information to determine the number of units Adelphi sold during FY 2018. (Round answer to nearest whole number)

Your Answer:

Question 1 options:

Answer

Question 2

Match the phrase that follows with the term (a-e) it describes.

Question 2 options:

1 2 3 4 5 shows expected results at several activity levels 1 2 3 4 5 estimates the number of units to be manufactured to meet sales and inventory levels 1 2 3 4 5 shows expected results at only one activity level 1 2 3 4 5 begins by estimating the quantity of sales 1 2 3 4 5 integrated set of operating and financing budgets for a period of time

1. static budget 2. flexible budget 3. master budget 4. sales budget 5. production budget

Question 3

Southern Company is preparing a cash budget for April. The company has $12,000 cash at the beginning of April and anticipates $30,000 in cash receipts and $34,500 in cash disbursements during April. Southern Company has an agreement with its bank to maintain a minimum cash balance of $10,000. To maintain the required balance during April, the company must

Question 3 options:

	borrow $4,500
	borrow $2,500
	borrow $7,500
	borrow $5,000

Question 4

Budgets need to be fair and attainable for employees to consider the budget important in their normal daily activities. Which of the following is not considered a human behavior problem?

Question 4 options:

	setting goals among managers that conflict with one another
	setting goals too tightly making it difficult to meet performance expectation
	allowing employees the opportunity to be a part of the budget process
	allowing goals to be so low that employees develop a “spend it or lose it” attitude

Question 5

If the expected sales volume for the current period is 7,000 units, the desired ending inventory is 400 units, and the beginning inventory is 400 units, the number of units set forth in the production budget, representing total production for the current period, is

Question 5 options:

	6,700
	7,400
	7,100
	7,000

Question 6

Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production departments (Mixing Department & Packaging Department.) Annapolis uses a step allocation method where the Computer Operations Department is allocated to all departments and Maintenance Services is allocated to the production departments. All allocations are based on total employees. Computer Operations has costs of $170,000 and Maintenance Services has costs of $130,000 before any allocations. What amount of Maintenance Services total cost is allocated to the Mixing Department? Round to closest whole number (no cents). Employees are:

Computer Operations 2

Maintenance Services 2

Mixing Department 5

Packaging Department 8

Your Answer:

Question 6 options:

Answer

Question 7

The following totals are used to create a CVP Income Statement for Frederick Company for FY2020:

Frederick Company
Selected Financial Figures
For the Year Ended 12/31/20
Sales (100 units)		$10,000
Variable Costs:
Direct Labor	$1,700
Direct Materials	1,400
Factory Overhead (variable)	2,000
Selling Expenses (variable)	600
Administrative Expenses (variable)	500
Fixed Costs:
Factory Overhead (fixed)	$850
Selling Expenses (fixed)	1,000
Administrative Expenses (fixed)	1,000

Frederick Company utilizes a JIT production system and there are no Raw Materials, Work-in-Process or Finished Goods inventories. Use this information to determine FY 2020 Contribution Margin Percentage. Enter percentage to one decimal place. (example enter 35.5% as 35.5)

Your Answer:

Question 7 options:

Answer

Question 8

If the expected sales volume for the current period is 8,000 units, the desired ending inventory is 1,400 units, and the beginning inventory is 1,200 units, the number of units set forth in the production budget, representing total production for the current period, is

Question 8 options:

	10,600
	8,200
	66,000
	6,800

Question 9

Towson Company manufactures book cases, and each requires 18 board feet of lumber. Towson expects that 1,800 and 1,750 book cases will be built in June and July, respectively. Towson keeps lumber on hand at 20% of the next month’s production needs. Use this information to determine number board feet of lumber that Towson Company should buy in June. (Round & enter final answer to the nearest whole number.)

Your Answer:

Question 9 options:

Answer

Question 10

The following totals are used to create a CVP Income Statement for Frederick Company for FY2020:

Frederick Company
Selected Financial Figures
For the Year Ended 12/31/20
Sales (100 units)		$10,000
Variable Costs:
Direct Labor	$1,700
Direct Materials	1,600
Factory Overhead (variable)	2,000
Selling Expenses (variable)	600
Administrative Expenses (variable)	500
Fixed Costs:
Factory Overhead (fixed)	$700
Selling Expenses (fixed)	1,000
Administrative Expenses (fixed)	1,000

Frederick Company utilizes a JIT production system and there are no Raw Materials, Work-in-Process or Finished Goods inventories. Use this information to determine the FY 2020 breakeven point in units. Round and enter as a whole number.

Your Answer:

Question 10 options:

Answer

Question 11

Ocean City Kite Company manufactures & sells kites for $8.50 each. The variable cost per kite is $2.50 and the breakeven point is 70,000 kites. Use this information to determine the dollar amount of Ocean City Kite Company’s fixed costs. Round to closest whole number (no cents).

Your Answer:

Question 11 options:

Answer

Question 12

The following data relate to direct labor costs for March:

Rate: standard, $12.00; actual, $12.25

Hours: standard, 18,500; actual, 17,955

Units of production: 9,450

Calculate the direct labor rate variance.

Question 12 options:

	$4,488.75 unfavorable
	$6,851.25 favorable
	$4,488.75 favorable
	$6,851.25 unfavorable

Question 13

Planning for capital expenditures is necessary for all of the following reasons except

Question 13 options:

	machinery and other fixed assets wear out
	expansion may be necessary to meet increased demand
	amounts spent for office equipment may be immaterial
	fixed assets may fall below minimum standards of efficiency

Question 14

The following data relate to direct materials costs for February:

Materials cost per yard: standard, $2.00; actual, $2.10

Standard yards per unit: standard, 4.5 yards; actual, 4.75 yards

Units of production: 9,500

Calculate the total direct materials cost variance.

Question 14 options:

	$9,262.50 unfavorable
	$9,262.50 favorable
	$3,780.00 unfavorable
	$3,562.50 favorable

Question 15

Adelphi Company has budgeted activity for March to reflect net income $180,000. All sales are credit sales. Receivables are planned to increase (decrease -) by $-9,000 payables to increase (decrease -) by $19,000 and Depreciation Expense is $60,000. Use this information to determine how much cash will increase (decrease) during the month of March. (Decreases in accounts receivable or accounts payable will have a negative sign in front of number. Round to nearest whole number (no cents).

Your Answer:

Question 15 options:

Answer

Question 16

A company’s history indicates that 20% of its sales are for cash and the rest are on credit. Collections on credit sales are 20% in the month of the sale, 50% in the next month, 25% the following month, and 5% is uncollectible. Projected sales for December, January, and February are $60,000, $85,000, and $95,000, respectively. The February expected cash receipts from all current and prior credit sales are

Question 16 options:

	$61,200
	$57,000
	$66,400
	$90,250

Question 17

At the beginning of the period, the Assembly Department budgeted direct labor of $110,000, direct materials of $170,000, and fixed factory overhead of $28,000 for 8,000 hours of production. The department actually completed 10,000 hours of production. What is the appropriate total budget for the department, assuming it uses flexible budgeting?

Question 17 options:

	$288,000
	$305,000
	$350,000
	$378,000

Question 18

Tara Company’s budget shows the following credit sales for the current year: September, $25,000; October, $36,000; November, $30,000; December, $32,000. Experience has shown that payment for credit sales is received as follows: 15% in the month of sale, 60% in the first month after sale, 20% in the second month after sale, and 5% is uncollectible. How much cash will Tara Company expect to collect in November as a result of current and past credit sales?

Question 18 options:

	$19,700
	$28,400
	$30,000
	$31,100

Question 19

Motorcycle Manufacturers, Inc. projected sales of 78,000 machines for the year. The estimated January 1 inventory is 6,500 units, and the desired December 31 inventory is 6,000 units. What is the budgeted production (in units) for the year?

Question 19 options:

	78,500
	70,000
	77,500
	70,500

Question 20

Which of the following is not a reason standard costs are separated into two components?

Question 20 options:

	The price and quantity variances need to be identified separately to correct the actual major differences
	Identifying variances determines which manager must find a solution to major discrepancies
	If a negative variance is overshadowed by a favorable variance, managers may overlook potential corrections
	Variances bring attention to discrepancies in the budget and require managers to revise budgets closer to actual results