121.Which of the following would be presented in the cash from operating activities section of the statement of cash flows when the indirect method is used?    A. Gain on the sale of investments.   B. Depreciation expense.   C. Neither a gain on the sale of investments nor depreciation expense would be shown.   D. Both a gain on the sale of investments and depreciation expense would […]

  61. On January 1, 2010, Woodstock, Inc. purchased a machine costing $40,000. Woodstock also paid $1,000 for transportation and installation. The expected useful life of the machine is 6 years and the residual value is $5,000. Which of the following statements is incorrect?  A. The annual depreciation expense is $6,000. B. The December 31, 2010 book value was $35,000. C. The December 31, 2012 accumulated depreciation balance was […]

  31) Which of the following is NOT one of the reasons that companies use an annual time period to compute the budgeted indirect-cost rate? 31) ______ A) the variable indirect-cost rate is too high B) the benefits of shorter periods do not outweigh the costs C) the budgeted quantity of the allocation base may fluctuate too much in periods shorter than one year D) […]

  11) The planning of fixed overhead costs differs from the planning of variable overhead costs in terms of timing.   12) The planning of fixed overhead costs does not differ from the planning of variable overhead costs.   Objective 8.2   1) Which of the following mathematical expression is used to calculate budgeted variable overhead cost rate per output unit? A) Budgeted output allowed […]

  134. Use the following selected information from Wheeler, LLC to determine the 2015 and 2014 common size percentages for operating expenses using Net sales as the base.    2015 2014 Net sales $276,200 $231,400 Cost of goods sold 151,900 129,590 Operating expenses 55,240 53,240 Net earnings 27,820 19,820   A. 36.4% for 2015 and 41.1% for 2014.B. 55.0% for 2015 and 56.0% for 2014.C. 23.9% for 2015 and […]

  11) General Insurance Company had a static budgeted operating income of $4.6 million; however, actual income was $3.0 million. What is the static budget variance of operating income? A) $1,000,000 favourable B) $1,000,000 unfavourable C) $1,600,000 favourable D) $3,000,000 favourable E) $1,600,000 unfavourable   Use the information below to answer the following question(s).   Ames Golf Company used the following data to evaluate their […]

    141. U.S. GAAP and IFRS distinguish three categories of long-lived assets for purposes of measuring and recognizing impairment losses. The second category addresses intangibles, other than goodwill, not subject to amortization.  This category does not include:  A. brand names. B. trademarks. C. franchise rights. D. renewable licenses. E. none of the above   142. Under U.S. GAAP and IFRS reporting standards, management assesses the firm’s assets for impairment at each […]

    11. The allowance for bad debts represents: A. bad debt losses incurred in the current period.B. the amount of uncollected accounts written off to date.C. the difference between total sales made on credit and the amount collected from those credit sales.D. the difference between the recorded value of accounts receivable and the net realizable value of accounts receivable.   12. Digital CorporationThe following data concern Digital Corporation for 2012.  Credit […]

    91. A business operated at 100% of capacity during its first month and incurred the following costs:  Production costs (20,000 units):       Direct materials $180,000     Direct labor 240,000     Variable factory overhead 280,000     Fixed factory overhead   100,000 $800,000       Operating expenses:       Variable operating expenses $130,000     Fixed operating expenses   […]

  61. Upon completing an aging analysis of accounts receivable, the accountant for Rosco Works aged the accounts receivable and estimated that $5,000 of the $98,000 accounts receivable balance would be uncollectible. The allowance for doubtful accounts had a $400 debit balance at year-end prior to adjustment. How much is bad debt expense?  A. $5,000 B. $5,400 C. $4,600 D. $400 62. Which of the following statements does not correctly describe […]