MGT 5 Quiz 4 Jeopardy

Chapter 8

100

What type of expense fits these descriptions?

1. Jointly caused by two or more segments
2. Exists even if one of the segments to which they are common is eliminated

Common Fixed Expense 

200

XYZLighting produces two types of lights: standard and deluxe. The unit contribution margins for these lights are $25 and $40, respectively. Each chandelier requires processing time on a specialized assembly line. The company has three assembly lines that together provide 12,000 hours of production time per year.

• The standard light requires 0.30 hours of assembly time per unit.
• The deluxe light requires 0.75 hours of assembly time per unit.

How many of each type of light must be produced to maximize the total contribution margin?

40,000 standard lights, 0 deluxe lights 

300

In a Make-Or-Buy situation, you determine the difference in costs by taking: _______ - relevant costs of manufacturing 

Cost of Purchasing - Relevant Costs of Manufacturing

Chapter 9

100

What is the Units to Be Produced Formula? 

Expected Unit Sales + Units in Desired Ending Inventory (EI) - Units in Desired Beginning Inventory (BI)

200

Linden Corp. estimated sales of 15,000 units at $55 each. The unit cost of goods sold is $30. The company incurs a marketing expense of $80,000 and pays a 12% commission on each unit sold. Administrative expenses are budgeted at $60,000.

What is Linden Corp.'s budgeted operating income?

$136,000

300

ABC Manufacturing budgeted sales of 50,000 units in April, 30,000 units in May, and 60,000 units in June. The company’s policy is to maintain 25% of the following month's sales in ending inventory. On April 1, the beginning inventory was 12,000 units.

Calculate April's production in units. 

45,500 units

Chapter 10

100

When actual prices or usage of inputs are greater than standard prices or usage, there is a ____ variance.

Unfavorable Variance 

200

Oakley Furniture manufactures tables. During the year, 50,000 tables were produced. The standard costs for materials and labor are as follows:

• Direct materials (3 wooden boards @ $8 each) → $24.00
• Direct labor (2 hours @ $12 per hour) → $24.00

Oakley purchased and used 155,000 wooden boards at $9.00 each.

Calculate the Material Price Variance (MPV).

MPV = 155,000 (Unfavorable)

300

Orchid Enterprises manufactures handcrafted jewelry boxes. During the year, 150,000 jewelry boxes were produced. The standard costs for materials and labor are as follows:

• Direct materials (3 pieces of wood @ $5) → $15.00
• Direct labor (1.5 hours @ $14) → $21.00

During production, Orchid Enterprises purchased and used 450,000 pieces of wood at $6.00 each. The actual labor hours worked were 230,000 hours, and the actual wage rate was $15 per hour.

What is Orchid Enterprises' labor rate variance?

$230,000 (Unfavorable)