Question :
141.Maxim Fasteners distributes giant binder clips that sell for $3 : 1302859
141.Maxim Fasteners distributes giant binder clips that sell for $3 each. Maxim pays $1.20 each to buy the clips. The company has $4,000 per month in fixed costs. Policies and other information follow:
Inventory is maintained at the end of each month equal to 10% of the next month’s projected sales in units.
Purchases are paid 40% in the month acquired and the balance in the month after.
All sales are on credit, and 30% are collect in the month of sale and 70% in the month after sale.
Budgeted monthly sales in units for the first five months of 2014 are as follows:
January6,000 units
February5,000 units
March7,000 units
April9,000 units
May8,000 units
Variable selling and administrative costs are $0.50 per clip and are paid in the month of incurred.
How much is budgeted net income for March using variable costing?
A.$9,100
B.$5,100
C.$12,600
D.$13,500
142.Maxim Fasteners distributes giant binder clips that sell for $3 each. Maxim pays $1.20 each to buy the clips. The company has $4,000 per month in fixed costs. Policies and other information follow:
Inventory is maintained at the end of each month equal to 10% of the next month’s projected sales in units.
Purchases are paid 40% in the month acquired and the balance in the month after.
All sales are on credit, and 30% are collect in the month of sale and 70% in the month after sale.
Budgeted monthly sales in units for the first five months of 2014 are as follows:
January6,000 units
February5,000 units
March7,000 units
April9,000 units
May8,000 units
Variable selling and administrative costs are $0.50 per clip and are paid in the month of incurred.
How much are budgeted cash collections during April?
A.$8,100
B.$22,800
C.$25,200
D.$27,000
143.Maxim Fasteners distributes giant binder clips that sell for $3 each. Maxim pays $1.20 each to buy the clips. The company has $4,000 per month in fixed costs. Policies and other information follow:
Inventory is maintained at the end of each month equal to 10% of the next month’s projected sales in units.
Purchases are paid 40% in the month acquired and the balance in the month after.
All sales are on credit, and 30% are collect in the month of sale and 70% in the month after sale.
Budgeted monthly sales in units for the first five months of 2014 are as follows:
January6,000 units
February5,000 units
March7,000 units
April9,000 units
May8,000 units
Variable selling and administrative costs are $0.50 per clip and are paid in the month of incurred.
What amount will be reported for budgeted Accounts Receivable at the end of April?
A.$8,100
B.$25,200
C.$6,300
D.$18,900
144.Maxim Fasteners distributes giant binder clips that sell for $3 each. Maxim pays $1.20 each to buy the clips. The company has $4,000 per month in fixed costs. Policies and other information follow:
Inventory is maintained at the end of each month equal to 10% of the next month’s projected sales in units.
Purchases are paid 40% in the month acquired and the balance in the month after.
All sales are on credit, and 30% are collect in the month of sale and 70% in the month after sale.
Budgeted monthly sales in units for the first five months of 2014 are as follows:
January6,000 units
February5,000 units
March7,000 units
April9,000 units
May8,000 units
Variable selling and administrative costs are $0.50 per clip and are paid in the month of incurred.
How much will budgeted contribution margin be for April?
A.$11,700
B.$21,000
C.$12,600
D.$9,100
145.Tee Time manufactures wireless USB ports and sells them for $9 each. The company recently began marketing and selling the USB ports on the Web, and based on economic predictions, the company expects sales to increase dramatically. Unit sales in December, 2014 totaled 18,000 units. Sales for 2015 are expected to increase by 10% each month for the near future. How much is the sales budget for February?
A.$178,200
B.$21,780
C.$196,020
D.$194,400
146.Hallmart expects to make inventory purchases in the next three months as follows:
April $56,000
May 80,000
June 90,000
Prior experience has shown that 35% of a month’s purchases are paid in the month of purchase and 65% in the month following purchase. March purchases were $65,000. How much are cash disbursements for purchases during May?
A.$28,000
B.$86,500
C.$71,600
D.$64,400
147.Market Leasing budgeted credit sales in the first quarter of 2014 to be as follows:
January $210,000
February 190,000
March 170,000
The budgeted beginning cash balance at February 1 is expected to be $14,000 and budgeted monthly cash disbursements are expected to be $198,000. Credit sales in December, 2013 are expected to be $204,000. The company expects to collect 20% of a month’s sales in the month of sale and 80% in the following month. How much is the budgeted cash balance at the end of February?
A.$22,000
B.$206,000
C.$8,000
D.$10,000
148.Hanson Retailers planned to make 280,000 cans of pasta sauce and spend $140,000 on tomatoes during November. However, demand was weak due to increased competition, and only 260,000 cans of pasta sauce were produced. The actual cost incurred was $132,000. Tomato prices were as expected during the period. Which of the following statements would be a fair statement regarding Hanson’s performance on tomato usage?
A.Hanson was under budget by $2,000 and did well controlling costs.
B.Hanson was over budget by $2,000.
C.Hanson’s flexible budget for tomatoes for performance evaluation was $132,000.
D.Hanson saved $8,000 in material costs for the period.
149.The results of operations for the Budget Pesticides, for the fourth quarter of 2014 were as follows:
Sales of bug spray $600,000
Variable cost of goods sold 280,000
Contribution margin 320,000
Fixed production costs $70,000
Fixed selling and administrative expenses 30,000 100,000
Income before taxes 220,000
Income taxes 88,000
Net income $132,000
Budget Pesticide uses the variable costing method. The company’s balance sheet reported the following amounts as of the end of the fourth quarter of 2014:
Cash$ 30,000Accounts payable$ 44,800
Accounts receivable300,000Common stock140,200
Fixtures and equipment130,000Retained earnings195,000
Accumulated depreciation80,000
Additional information:
1.Sales and variable costs of sales are expected to increase by 5% in the next quarter.
2.All sales are on credit with 50% collected in the quarter of sale and 50% collected in the following quarter.
3.Variable cost of sales consists of 40% materials, 40% direct labor, and 20% variable overhead.
4.All materials are purchased on credit and 60% are paid for in the quarter of purchase and the remaining amount is paid for in the quarter after purchase. There is no beginning or ending inventory.
5.Direct labor and variable overhead are paid in the quarter the expenses are incurred.
6.Fixed production costs include $3,000 of depreciation. Fixed production costs are paid in the quarter they are incurred.
7.Fixed selling and administrative costs, other than $4,000 of depreciation expense, are expected to increase by 2% per quarter. Fixed selling and administrative costs are paid in the quarter they are incurred.
8.The tax rate is expected to be 40%. All taxes are paid in the quarter they are incurred.
How much is the budgeted contribution margin for the first quarter of 2015?
A.$266,000
B.$336,000
C.$406,000
D.$250,000
150.The results of operations for the Budget Pesticides, for the fourth quarter of 2014 were as follows:
Sales of bug spray $600,000
Variable cost of goods sold 280,000
Contribution margin 320,000
Fixed production costs $70,000
Fixed selling and administrative expenses 30,000 100,000
Income before taxes 220,000
Income taxes 88,000
Net income $132,000
Budget Pesticide uses the variable costing method. The company’s balance sheet reported the following amounts as of the end of the fourth quarter of 2014:
Cash$ 30,000Accounts payable$ 44,800
Accounts receivable300,000Common stock140,200
Fixtures and equipment130,000Retained earnings195,000
Accumulated depreciation80,000
Additional information:
1.Sales and variable costs of sales are expected to increase by 5% in the next quarter.
2.All sales are on credit with 50% collected in the quarter of sale and 50% collected in the following quarter.
3.Variable cost of sales consists of 40% materials, 40% direct labor, and 20% variable overhead.
4.All materials are purchased on credit and 60% are paid for in the quarter of purchase and the remaining amount is paid for in the quarter after purchase. There is no beginning or ending inventory.
5.Direct labor and variable overhead are paid in the quarter the expenses are incurred.
6.Fixed production costs include $3,000 of depreciation. Fixed production costs are paid in the quarter they are incurred.
7.Fixed selling and administrative costs, other than $4,000 of depreciation expense, are expected to increase by 2% per quarter. Fixed selling and administrative costs are paid in the quarter they are incurred.
8.The tax rate is expected to be 40%. All taxes are paid in the quarter they are incurred.
How much are the total budgeted cash receipts for the first quarter of 2015?
A.$315,000
B.$600,000
C.$615,000
D.$645,750
