ACCT 202 Final ExamIn-Class Review QuestionsUse the following to answer the next two questions:Smith Paints allocates overhead based on machine hours. Selected data for the most recent year follow.Estimated manufacturing overhead cost $250,000 Estimated machine hours 20,000Actual manufacturing overhead cost $230,000 Actual machine hours 21,0001. The amount of manufacturing overhead allocated to jobs during the year isA. $250,000B. $219,048C. $230,000D. $262,5002. The amount of overallocated or underallocated overhead isA. $32,500 overallocatedB. $12,500 overallocatedC. $20,000 underallocatedD. $1,000 underallocated3.Chilson Company manufactures custom engines for use in the lawn and garden equipment industry. The company allocates manufacturing overhead based on machine hours. Selected data for costs incurred for Job 612 are as follows:Direct materials used $ 3,500 Direct labor hours worked 300Machine hours used 400Direct labor rate per hour $ 16 Predetermined overhead rate based on machine hours $ 18 What is the total cost of Job 612?A. $8,300B. $7,200C. $15,500D. $13,700Use the following information for the next two questions:Conrad Company has prepared the following budgeted monthly contribution margin income statement:Sales $126,000Variable Expenses 70,000Contribution Margin 56,000Fixed Expenses 36,000Operating Income $20,000 4. What is Conrad Company’s operating leverage factor at the budgeted level of operating income? A. 2.25 B. 2.8 C. .36 D. 1.555.. If sales are 10% more than anticipated, how much would operating income increase? A. 225% B. 10% C. 28% D. 2.8%Use the following to answer the next two questionsMarietta Piping Corporation provides the following information about its single product:Selling price per unit $120.00Variable cost per unit $45.00Total fixed cost $90,000 6. What is the breakeven point in sales dollars?A. $240,000B. $1,200C. $33,750D. $144,0007. How many units must be sold to earn targeted operating income of $60,000? A. 800 B. 1,200 C. 2,000 D. 9098. Julia's Catering has monthly target sales of $20,000. The breakeven even level of sales is $8,000. What is the monthly margin of safety as a percentage of target sales? A. 250.00% B. 66.67% C. 60.00% D. 40.00%9. Star Appliance manufactures a variety of appliances which all use Part 92F. Currently, the company manufactures Part92F itself. It has been producing 8,000 units of Part 92F annually. The annual costs of producing one Part 92F at this levelis: Direct materials $ 4.00 Direct labor $ 8.00 Variable manufacturing overhead $ 6.00 Fixed manufacturing overhead $ 3.00 Total cost $ 21.00 Total fixed manufacturing overhead costs would continue whether Part 92F is made internally or purchased from an outside supplier. Star Appliance has no alternative use for the manufacturing facilities. Roger Parts Company has offered to sell 8,000 units of Part 92F to Star Appliance for $22.00 per unit. What should Star Appliance do? A. Make the part and save $4 per unit. B. Make the part and save $10 per unit. C. Buy from Roger Parts Company and lose $1 per unit. D. Make the part and save $13 per unit.10. Pottery Unlimited has two product lines: cups and pitchers. Income statement data for the most recent year follow:Total Cups PitchersSales revenue $460,000 $310,000 $150,000Variable expenses 355,000 235,000 120,000Contribution margin 105,000 75,000 30,000Fixed expenses 76,000 38,000 38,000Operating income (loss) $29,000 $37,000 $(8,000)If $20,000 of the Pitchers’ fixed costs will be eliminated by dropping the Pitcher line, how will operating income be affected? A. Increase $19,000 B. Decrease $50,000 C. Decrease $10,000 D. Increase $48,000Use the following information for the next two questions:Williams Department Stores is considering expansion plans. One proposal involves opening 5 stores in Kentucky at the cost of $2,400,000. The following information is available:Kentucky proposalRequired investment $2,400,000Estimated life 10 yearsEstimated annual cash inflows over the next 10 years$500,000Required rate of return 10%11. The net present value of the proposal is closest to:A. $672,500.B. $684,600.C. $3,072,500D. $1,900,000.12. The internal rate of return is closest toA. 4.8 %B. 10%C. 18%D. 16%Use the following information for the next two questions: Samson Company prepared the following purchases budget:Month Budgeted PurchasesJuly $42,500 August $39,600 September $45,800 All purchases are paid for as follows: 60% in the month of purchase and 40% in the following month. 13. How much cash was paid for purchases in August?A. $39,600B. $40,760C. $23,760d. $44,48014. What is the balance of accounts payable at August 31?A. $27,480B. $15,840C. $18,320D. $22,900Use the following information to answer the next two questions:For the current year, A.C. Catering reported actual sales of 5,200 units at $8.50 per unit. The master budget’s revenue wasbased on 5,000 units at $7 per unit. 15. What is the volume variance for sales revenue?A. $,1,400 FB. $ 9,200 FC. $7,800 UD. $1,400 U16. What is the flexible budget variance for sales revenue?A. $7,800 FB. $9,200 FC. $1,400 FD. $7,500 UUse the following for the next two questions:Grayson Industries has collected the following data for one of its products when it produced 24,000 units:Direct materials standard 2 pounds per unit @ $0.50/lb.Actual cost of materials (40,000 lbs.) $58,000Actual direct materials purchased and used 40,000 pounds 17. How much is the direct materials price variance? A. $38,000 favorable B. $38,000 unfavorable C. $4,000 favorable D. $4,000 unfavorable18. How much is the direct materials quantity variance?A. $38,000 favorableB. $4,000 unfavorableC. $4,000 favorableD. $38,000