Question : 46) Purchases budgeted for February total: A) $69,120 B) $60,480 : 1217214

46) Purchases budgeted for February total:

A) $69,120

B) $60,480

C) $115,200

D) $64,800

47) Shamokin Manufacturing produces two products, Big and Bigger. Shamokin expects to sell 10,000 units of product Bigger and to have an inventory of 2,000 units of Bigger on hand at the end of the period. Currently, Shamokin has 800 units of Bigger on hand. Bigger requires two labor operations, molding and polishing. Each unit of Bigger requires one hour of molding and two hours of polishing. The direct labor rate for molding is $20 per molding hour and the direct labor rate for polishing is $25 per polishing hour. The expected cost of direct labor for Bigger is:

A) $224,000

B) $560,000

C) $616,000

D) $784,000

48) Shamokin Manufacturing produces two products, Big and Bigger. Shamokin expects to sell 10,000 units of product Bigger and to have an inventory of 2,000 units of Bigger on hand at the end of the period. Currently, Shamokin has 800 units of Bigger on hand. Bigger requires two labor operations, molding and polishing. Each unit of Bigger requires one hour of molding and two hours of polishing. The direct labor rate for molding is $20 per molding hour and the direct labor rate for polishing is $25 per polishing hour. The expected number of hours of direct labor for Bigger is:

A) 8,800 hours of molding; 17,600 hours of polishing

B) 11,200 hours of molding; 22,400 hours of polishing

C) 17,600 hours of molding; 8,800 hours of polishing

D) 22,400 hours of molding; 11,200 hours of polishing

49) St. Claire Manufacturing expects to produce and sell 6,000 units of Big, its only product, for $20 each. Direct material cost is $2 per unit, direct labor cost is $8 per unit, and variable manufacturing overhead is $3 per unit. Fixed manufacturing overhead is $24,000 in total. Variable selling and administrative expenses are $1 per unit, and fixed selling and administrative costs are $3,000 in total. According to generally accepted accounting principles, inventoriable cost per unit of Big would be:

A) $13.00 per unit

B) $14.00 per unit

C) $17.00 per unit

D) $18.50 per unit

50) The use of activity-based budgeting is growing because of:

A) the increased use of activity-based costing

B) the increased use of kaizen costing

C) increases in work-in-process inventory

D) increases in direct materials inventory

51) Activity-based budgeting would separately estimate:

A) the cost of overhead for a department

B) a plant-wide cost-driver rate

C) the cost of a setup activity

D) All of these answers are correct.

52) Activity-based-costing analysis makes no distinction between:

A) direct-materials inventory and work-in-process inventory

B) short-run variable costs and short-run fixed costs

C) parts of the supply chain

D) components of the value chain

53) Activity-based budgeting makes it easier to:

A) determine a rolling budget

B) prepare pro forma financial statements

C) determine how to reduce costs

D) execute a financial budget

54) Activity-based budgeting does NOT require:

A) knowledge of the organization’s activities

B) specialized expertise in financial management and control

C) knowledge about how activities affect costs

D) the ability to see how the organization’s different activities fit together

55) Activity-based budgeting:

A) uses one cost driver such as direct labor-hours

B) uses only output-based cost drivers such as units sold

C) focuses on activities necessary to produce and sell products and services

D) classifies costs by functional area within the value chain