WorksheetsChallenge Game 3
Total questions: 10
Worksheet time: 1hrs 19mins
TP Co has produced a budget based on 2000 units as shown below.
Budget Quantity: 2000 units
$
Sales revenue 90000
Direct materials 27000
Direct labour 16500
Fixed overheads 20000
What would be the operating profit in a flexible budget based on 2400 units?
(a)
MK Co is preparing its labour budget for the next period.
You have been provided with the following information:
Sales demand 2150 units
Opening inventory of finished goods 350 units
Closing inventory of finished goods 425 units
Direct labour time per unit 3 hours
Current labour efficiency level 75%
Labour rate per hour $14
Calculate the labour budget in $.
(a)
Gift Co is a manufacturing business.
You have been provided with the following budget and actual results for the month ending May 20X6.
Refer to the table.
Which TWO of the following statements are true?
In a flexed budget the direct materials cost would be $23936.
The sales revenue per unit in a flexed budget would be $37.50.
In a flexed budget the fixed overheads would be $13000.
In a fixed budget the direct labour cost would be $13838.
TU Co has realised that it will have a temporary cash shortage before it receives the money for a very large order from a customer.
Which TWO of the following actions would be appropriate for TU Co to take?
Arrange a bank overdraft
Implement better credit control procedures
Replace non-current assets
Pay suppliers early
Increase inventory
Expend Co has analysed the pattern of customer receipts and has identified the following pattern for the collection of debts.
Invoices paid in the month after sale 60%
Invoices paid in the second month after sale 25%
Invoices paid in the third month after sale 15%
Credit sales for June to August 20X5 are budgeted as follows:
June $50000
July $75000
August $65000
Customers who pay in the month after sale are entitled to deduct a 2% settlement discount.
What is the amount budgeted to be received in September 20X5 from credit sales?
(a)
GH Co has identified the monthly costs associated with two different levels of activity as follows:
September: 4500 units Total cost $ 51250
October: 5200 units Total cost $59200
GH Co has identified there is a step up of $2000 in fixed costs when the activity level goes above 5000 units.
What is the monthly cost at an activity level of 5500 units?
(a)
Which one of the following would be the best course of action for Evenly Co to take to resolve the situation?
Delay the capital expenditure until June
Organise a bank loan to cover the deficit
Pay suppliers early to obtain settlement discounts
Implement better credit control procedures
Identify which of the following item is included in the cash flows when determining the net present value of a project.
Interest payments on the loan to finance the investment
The disposal value of the asset at the end of its life
Research costs incurred prior to the appraisal
Depreciation charges for the asset
The materials cost is $6 per unit.
30% of purchases are paid for in the month of purchase, while the other 70% are purchased on credit and are paid for two months after purchase.
What amount would appear as payments for materials in December?
(a)
Identify which one of the following statements regarding standard costing is TRUE?
An adverse labour efficiency variance means the actual labour hours worked were less than the standard hours
The fixed production overhead variance can be sub-divided into the expenditure and volume variances
A favourable material price variance will always result in an adverse material usage variance
Favourable variances mean the results are better than expected and therefore need not be investigated.
