Virgen Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During May, the kennel budgeted for 3,700 tenant-days, but its actual level of activity was 3,690 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for May:Data used in budgeting: Fixed Element per MonthVariable element per tenant-dayRevenue - $26.40 Wages and salaries$2,500 $6.10Food and supplies 1,300 9.70Facility expenses 8,600 2.60Administrative expenses 6,800 0.40Total expenses$19,200 $18.80?Actual results for May: ?Revenue$92,626 Wages and salaries$23,919?Food and supplies$37,833?Facility expenses$18,594?Administrative
expenses$8,386???The net operating income in the planning budget for May would be closest to:
A. $3,883
B. $8,844
C. $8,920
D. $3,905
Answer: C
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Mallard Corporation uses the product cost concept of product pricing. Below is cost information for the production and sale of 45,000 units of its sole product. Mallard desires a profit equal to a 12% rate of return on invested assets of $800,000. Fixed factory overhead cost $82,000 Fixed selling and administrative costs 45,000 Variable direct materials cost per unit 5.50 Variable direct labor
cost per unit 7.65 Variable factory overhead cost per unit 2.25 Variable selling and administrative cost per unit .90 The cost per unit for the production of the company's product is: A) $13.15 B) $17.22 C) $15.40 D) $15.75
Assuming that the number of units produced is greater than the number of units sold, which of the following statements is true when comparing net operating income using absorption and variable costing?
A) Absorption costing will yield a higher net operating income. B) Variable costing will yield a higher net operating income. C) Net operating income will be the same under both methods. D) Sales revenue will be less using absorption costing.
On December 1, 2017, Falcon, Inc sold machinery to a customer for $25,000
The customer could not pay at the time of sale but agreed to pay 11 months later and signed a 11-month note at 8% interest. How much interest revenue was earned for the entire term of the note? (Round your answer to the nearest dollar.) A) $1,833 B) $1,670 C) $167 D) $2,000
Which of the following activities would most likely affect a particular company's systematic risk?
A. The company's CEO resigns. B. The firm's sales this year probably will substantially lower than the amount forecasted by senior management. C. According to the U.S. government, inflation is expected to increase during the next five years. D. There is a good chance that the firm will experience a long labor strike in the near future. E. Next year the company plans to introduce a new product line that has a 30 percent chance of failing.