Mixed Bank 5

The costs of the factory maintenance department for C Co appear to have a variable element dependent upon the number of units produced. The fixed element of the costs steps up when 20,000 or more units are produced. At an activity level of 22,000 units, the fixed element of the cost is $25,000. The variable cost per unit is constant.

Units $

18,000 200,000

22,000 245,000

What would be the total cost for 19,000 units and the total cost for 21,000 units?

19,000 units 21,000 units

• $210,000 $235,000

• $215,000 $235,000

• $210,000 $230,000

• $231,660 $258,940

A company has a capital employed of $300,000. It has a cost of capital of 10% per year. Its residual income is $30,000.

What is the company's return on investment?

• 1%

• 10%

• 18%

• 20%

Are the following statements, which refer to documents used in the material procurement procedures of a company, true or false?

(i) All purchase requisitions are prepared in the purchasing department and are then sent out to suppliers

(ii) All goods received notes are prepared in the goods inwards department

Statement (i) Statement (ii)

• False False

• True True

• True False

• False True

A company uses standard marginal costing. Last month the standard contribution on actual sales was $40,000 and the following variances arose: Sales price variance $1,000 Favourable Sales volume contribution variance $3,500 Adverse Fixed overhead expenditure variance $2,000 Adverse There were no variable cost variances last month

What was the actual contribution for last month?

• $35,500

• $37,500

• $39,000

• $41,000

A company uses flexed budgets. The fixed budget for last month was based on 100% activity and showed direct costs of $100,000. Last month's actual direct costs were compared with the flexed budget to show the following:

Actual Variance

Direct costs $93,600 $2,400 Adverse

What was the actual activity as a % of the fixed budget last month?

• 91.2%

• 93.6%

• 96.0%

• 97.5%

A process operates with a normal loss of 5% of input. All losses have a realisable value of $38 per litre. Last month 10,000 litres were input to the process and good production was 9,200 litres. Process costs arising last month were $456,000. There was no work-in-progress.

What was the credit entry in the process account for abnormal loss last month?

• 11,400

• 13,440

• 13,800

• 14,400

The price index for a commodity in the current year is 175 (base year = 100). The current price for the commodity is $92.70 per unit.

What was the price per unit in the base year?

• $92.70

• $25.20

• $52.97

• $188.78

Dee Co uses a pie chart to show its sales for its various products. One of the segments on the pie chart is 120 degrees and this represents $200,000 worth of sales of the product D.

What is the total sales value for Dee Co?

• $250,000

• $500,000

• $600,000

• $900,000

D Co forecasts costs using the model y = a + bx. The gradient is $40. When y = $1,100 then x = 20.

What is the value of the intercept?

• 300

• 1,100

• 1,500

• 1,900

A company has under-absorbed fixed production overheads for the period by $9,000. The fixed production overhead absorption rate was $7 per unit and is based on the normal level of activity of 5,000 units. Actual production was 5,500 units.

What was the actual fixed production overheads incurred for the period?

• $26,000

• $29,500

• $44,000

• $47,500