Question : 94. The costs of services charged to a profit center the : 1227018

 

 

94. The costs of services charged to a profit center on the basis of its use of those services are called: A. operating expensesB. noncontrollable chargesC. service department chargesD. activity charges

 

95. Division X reported income from operations of $975,000 and total service department charges of $575,000. Therefore: A. net income was $400,000B. the gross profit margin was $400,000C. income from operations before service department charges was $1,550,000D. consolidated net income was $400,000

 

96. To calculate income from operations, total service department charges are: A. added to income from operations before service department chargesB. subtracted from operating expensesC. subtracted from income from operations before service department chargesD. subtracted from gross profit margin

 

97. Income from operations for Division Z is $150,000, total service department charges are $400,000 and operating expenses are $2,266,000. What are the revenues for Division Z? A. $550,000B. $3,216,000C. $2,816,000D. $2,666,000

 

98. Income from operations for Division K is $120,000, and income from operations before service department charges is $975,000. Therefore: A. total operating expenses are $855,000B. total manufacturing expenses are $855,000C. direct materials, direct labor, and factory overhead total $855,000D. total service department charges are $855,000

 

99. The following data are taken from the management accounting reports of Dulcimer Co.: 

 

Div. A

Div. B

Div. C

Income from operations

$1,800,000

$1,350,000

$1,350,000

Total service department charges

1,700,000

1,050,000

1,100,000

 

 

 

 

If an incentive bonus is paid to the manager who achieved the highest income from operations before service department charges, it follows that: A. Division A’s manager is given the bonusB. Division B’s manager is given the bonusC. Division C’s manager is given the bonusD. The managers of Divisions B and C divide the bonus

 

100. What is the term used to describe expenses that are incurred for the benefit of a specific department? A. Indirect expensesB. Margin expensesC. Departmental expensesD. Direct expenses

 

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

98,000

68,000

 

Interest expense

 

 

$  2,040

General overhead

 

 

18,160

Income tax

 

 

4,700

 

 

 

 

The gross profit for the Rails Division is: A. $50,800B. $23,600C. $13,240D. $33,280

 

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

98,000

68,000

 

Interest expense

 

 

$  2,040

General overhead

 

 

18,160

Income tax

 

 

4,700

 

 

 

 

The income from operations for the Rails Division is: A. $5,800B. $23,600C. $13,240D. $33,280

 

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

98,000

68,000

 

Interest expense

 

 

$  2,040

General overhead

 

 

18,160

Income tax

 

 

4,700

 

 

 

 

The gross profit for the Locomotive Division is: A. $47,800B. $20,600C. $17,240D. $37,280