61) In an EVA calculation, the measure of the invested capital for a division would be that division’s assets minus that division’s long-term liabilities. 62) In an EVA calculation, the appropriate measure of a division’s profit would be that division’s pre-tax operating income.   63) Antique Corp uses the investment center concept for the museums that it manages. Selected operating data for three of […]

    Objective 17.1   1) Costing systems that are used for the costing of like or similar units of products in mass production are called ________. A) inventory-costing systems B) job-costing systems C) process-costing systems D) weighted-average costing systems   2) Which of the following companies is most likely to use process costing? A) Crimpson Color, a company selling customized garments for niche customers […]

103) Based on the partial trial balance and the partial adjusted trial balance shown below, prepare the six missing adjusting entries. The adjusting entries should be dated December 31.   AccountTrial BalanceAdjusted Trial Balance   Debit Credit Debit Credit Accounts Receivable 101,600   110,000   Supplies 5,000   3,800   Prepaid Insurance 10,600   5,800   Accumulated Amortization   55,300   57,300 Salary Payable   […]

  131. Land, originally purchased for $20,000, is sold for $75,000 in cash. What is the effect of the sale on the accounting equation?  A. assets increase $75,000; stockholders’ equity increases $75,000 B. assets increase $55,000; stockholders’ equity increases $55,000 C. assets increase $75,000; liabilities decrease $20,000; stockholders’ equity increases $55,000 D. assets increase $20,000; no change for liabilities; stockholders’ equity increases $75,000 132. The Kennedy Company sold land for $60,000 […]

    31.Oakton Furniture provided the following information relevant to its sales for December 2013 and the first quarter of 2014  Based on the company’s collection history, 2% of credit sales are uncollectible, 40% are collected in month of sale and the remainder is collected in the following month. Total budgeted cash receipts in February 2014 are expected to be:    A. $60,000.   B. $162,400.   C. $346,400.   […]

  4) Backflush costing uses normal or standard costs.   5) A trigger point refers to the inventory level at which a reorder is generated.   6) A firm using a backflush costing system will always use actual costs rather than standard costs.   7) The “flush” in backflush refers to the fact that there are no variances in a backflush costing system using standard […]

    101. A company had a profit margin of 5%. If net income equaled $83,000 and average total assets equaled $45,000, how much were net sales? A. $4,150B. $2,250C. $1,660,000D. $6,400E. $128,000     102. A company had a return on common stockholders’ equity of 22%. Net income equaled $600,000 and average common stockholders’ equity equaled $2,500,000. Compute the amount of the preferred dividends declared. A. $50,000B. $550,000C. $132,000D. $10,763,636E. $10,000     103. A company had a return […]

  29) Discuss considerations that should be fully taken into account when developing inventory related relevant costs for use in an economic order quantity (EOQ) model. Objective 20.3   1) Video Images is a distributor of DVDs. Quick-Disk Mart is a local retail outlet which sells blank and recorded DVDs. Quick-Disk Mart purchases tapes from Video Images at $3.00 per DVD.  DVDs are shipped in […]

    91. A company had the following purchases during the current year:     January: 10 units at $120 February: 20 units at $130 May: 15 units at $140 September: 12 units at $150 November: 10 units at $160   On December 31, there were 26 units remaining in ending inventory. These 26 units consisted of 2 from January, 4 from February, 6 from May, […]

  30.An opportunity cost:    A. Is an unavoidable cost because it remains the same regardless of the alternative chosen. B. Requires a current outlay of cash. C. Results from past managerial decisions. D. Is the potential benefit lost by choosing a specific alternative course of action among two or more. E. Is irrelevant in decision making because it occurred in the past. 31.The potential benefits lost by taking a specific […]