Question : 101. The following financial information was summarized from the accounting records : 1239599

 

 

101. The following financial information was summarized from the accounting records of Train Corporation for the current year ended December 31: 

 

RailsDivision

LocomotiveDivision

CorporateTotal

Cost of goods sold

$47,200

$30,720

 

Direct operating expenses

27,200

20,040

 

Net sales

108,000

78,000

 

Interest expense

 

 

$  2,040

General overhead

 

 

18,160

Income tax

 

 

4,700

 

 

 

 

The gross profit for the Rails Division is: A. $60,800B. $33,600C. $8,700D. $21,150

 

102. The following financial information was summarized from the accounting records of Train Corporation for the current year ended December 31: 

 

RailsDivision

LocomotiveDivision

CorporateTotal

Cost of goods sold

$47,200

$30,720

 

Direct operating expenses

27,200

20,040

 

Net sales

108,000

78,000

 

Interest expense

 

 

$  2,040

General overhead

 

 

18,160

Income tax

 

 

4,700

 

 

 

 

The income from operations for the Rails Division is: A. $60,800B. $33,600C. $8,700D. $21,150

 

103. The following financial information was summarized from the accounting records of Train Corporation for the current year ended December 31: 

 

RailsDivision

LocomotiveDivision

CorporateTotal

Cost of goods sold

$47,200

$30,720

 

Direct operating expenses

27,200

20,040

 

Net sales

108,000

78,000

 

Interest expense

 

 

$  2,040

General overhead

 

 

18,160

Income tax

 

 

4,700

 

 

 

 

The gross profit for the Locomotive Division is: A. $57,960B. $14,790C. $27,240D. $47,280

 

104. The following financial information was summarized from the accounting records of Train Corporation for the current year ended December 31: 

 

RailsDivision

LocomotiveDivision

CorporateTotal

Cost of goods sold

$47,200

$30,720

 

Direct operating expenses

27,200

20,040

 

Net sales

108,000

78,000

 

Interest expense

 

 

$  2,040

General overhead

 

 

18,160

Income tax

 

 

4,700

 

 

 

 

The income from operations for the Locomotive Division is: A. $57,960B. $14,790C. $27,240D. $47,280

 

105. The following financial information was summarized from the accounting records of Train Corporation for the current year ended December 31: 

 

RailsDivision

LocomotiveDivision

CorporateTotal

Cost of goods sold

$47,200

$30,720

 

Direct operating expenses

27,200

20,040

 

Net sales

108,000

78,000

 

Interest expense

 

 

$  2,040

General overhead

 

 

18,160

Income tax

 

 

4,700

 

 

 

 

The net income for Train Corporation is: A. $83,180B. $35,940C. $48,390D. $60,840

 

106. Responsibility accounting reports for profit centers will include  A. costs.B. revenues.C. expenses and fixed assets.D. revenues, expenses, net income or loss from operations.

 

107. Some organizations use internal service departments to provide like services to several divisions or departments within an organization. Which of the following would probably not lend itself as a service department? A. Inventory ControlB. Payroll AccountingC. Information SystemsD. Human Resources

 

108. The following is a measure of a manager’s performance working in a profit center. A. balance sheetB. rate of return and residual income measuresC. budget performance reportD. divisional income statements

 

109. Which of the following would not be considered an internal centralized service department? A. Payroll accounting departmentB. Manufacturing departmentC. Information systems departmentD. Purchasing department

 

110. Avey Corporation had $275,000 in invested assets, sales of $330,000, income from operations amounting to $49,500 and a desired minimum rate of return of 7.5%. The rate of return on investment for Avey Corporation is: A. 8%B. 10%C. 18%D. 7.5%