Reference no: EM132186625

Questions -

Question 1 - Our Company manufactures bird feeders. The budgeted sales price is $20 per unit, and the variable costs are $12 per unit. Budgeted fixed costs for the company are $25,000.

What is the budgeted amount for operating income for 5,000 bird feeders?

$8.00 per unit

$45,000

$25,000

$15,000

Question 2 - Our Company manufactures bird feeders. The budgeted sales price is $30 per unit, and the variable costs are $12 per unit. Budgeted fixed costs for the company are $15,000.

What is the budgeted amount for contribution margin for 5,000 bird feeders?

$18.00 per unit

$90,000

$75,000

$60,000

Question 3 - The actual operating income for our company for the current year was $97,000. The flexible budgeted operating income for actual sales volume was $95,000, and the static budget for operating income was $96,000.

What is the flexible budget variance for operating income on the Flexible Budget Performance Report?

$2,000 favorable

$2,000 unfavorable

$1,000 favorable

$1,000 unfavorable

Question 4 - The static budget for our company shows a sales volume of 2,000 units and a sales price of $60 per unit. Actual sales for the year totaled 2,100 units, and the actual sales price was $58 per unit.

What is the flexible budget variance for sales revenue on the Flexible Budget Performance Report?

$4,200 favorable

$4,200 unfavorable

$6,000 favorable

$6,000 unfavorable

Question 5 - Which of the following would most likely be evaluated using residual income?

cost center

revenue center

profit center

investment center

Question 6 - A manager who is responsible for generating revenue and controlling costs is most likely the manager of:

a cost center

a revenue center

a profit center

an investment center

Question 7 - The following information is available for our company for the current year:

• operating income, $75,000;
• average total assets, $500,000;
• net sales, $750,000; and
• required rate of return, 12%.

Calculate the return on investment (ROI) rounded to two decimal places.

6.67%

10.00%

15.00%

16.67%

Question 8 - The following information is available for our company for the current year:

• operating income, $45,000;
• average total assets, $400,000;
• net sales, $900,000; and
• required rate of return, 12%.

Calculate the profit margin to two decimal places.

4.44%

5.00%

8.89%

11.25%

Question 9 - The following information is available for our company for the current year:

• operating income, $75,000;
• average total assets, $500,000;
• net sales, $750,000; and
• required rate of return, 12%.

Calculate the asset turnover to two decimal places.

1.25 times

1.50 times

6.67 times

8.75 times

Question 10 - The following information is available for our company for the current year:

• operating income, $75,000;
• average total assets, $500,000;
• net sales, $750,000; and
• required rate of return, 12%.

Calculate residual income.

($15,000)

$15,000

($60,000)

$60,000