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ACCT 2101- EXAM 2 2025 WITH ACCURATE SOLUTIONS, Exams of Nursing

Herzing UniversityNursing

ACCT 2101- EXAM 2 2025 WITH ACCURATE SOLUTIONS

Typology: Exams

2024/2025

Available from 07/02/2025

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ACCT 2101- EXAM 2 2025 WITH ACCURATE
SOLUTIONS
1. Which of the following statements is true?
A. The break-even point is that level of activity where sales revenue equals total variable cost.
B. Total contribution margin is defined as total sales revenue plus total variable cost.
C. The break-even point in unit sales is found by dividing total fixed cost by the contribution
margin per unit.
D. The difference between budgeted sales revenue and break-even sales revenue is the
operating leverage.
E. The safety margin is another name for the break-even point. - correct answers โœ”โœ”C. The
break-even point in unit sales is found by dividing total fixed cost by the contribution margin per
unit.
2. Which of the following occurs if a company increases its variable cost per unit? (Assume that
selling price per unit, sales volume, and total fixed cost remain constant.)
A. The contribution margin would increase.
B. The break-even point would decrease.
C. The break-even point would increase.
D. Net income would increase.
E. More than one of the answers would occur. - correct answers โœ”โœ”C. The break-even point
would increase.
3. Refer to the figure below. The vertical distance between the total cost line (Line B) and the
total revenue line (Line A) represents:
A. fixed cost. B. variable cost. C. profit or loss at that volume. D. semivariable cost. E. the safety
margin. - correct answers โœ”โœ”C. profit or loss at that volume
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ACCT 2101- EXAM 2 2025 WITH ACCURATE

SOLUTIONS

  1. Which of the following statements is true? A. The break-even point is that level of activity where sales revenue equals total variable cost. B. Total contribution margin is defined as total sales revenue plus total variable cost. C. The break-even point in unit sales is found by dividing total fixed cost by the contribution margin per unit. D. The difference between budgeted sales revenue and break-even sales revenue is the operating leverage. E. The safety margin is another name for the break-even point. - correct answers โœ”โœ”C. The break-even point in unit sales is found by dividing total fixed cost by the contribution margin per unit.
  2. Which of the following occurs if a company increases its variable cost per unit? (Assume that selling price per unit, sales volume, and total fixed cost remain constant.) A. The contribution margin would increase. B. The break-even point would decrease. C. The break-even point would increase. D. Net income would increase. E. More than one of the answers would occur. - correct answers โœ”โœ”C. The break-even point would increase.
  3. Refer to the figure below. The vertical distance between the total cost line (Line B) and the total revenue line (Line A) represents: A. fixed cost. B. variable cost. C. profit or loss at that volume. D. semivariable cost. E. the safety margin. - correct answers โœ”โœ”C. profit or loss at that volume
  1. Dachshund Company has a break-even point of 20,000 units. If the company's sole product sells for $38 and fixed costs total $260,000, the variable cost per unit must be: A. $13. B. $25. C. $12. D. $51. E. None of these. - correct answers โœ”โœ”BE= fixed cost/ CMunit - CMunit= selling price - variable cost 38(20000) - _____(20000) - 260000= 0 500000/20000= 25 B. $
  2. The following monthly data are available for Coco Chips Company and its only product: Unit Sales Price $ Unit Variable Expenses $ Total Fixed Expenses $37, Actual sales in August 1,230 units The company's safety margin in August was: A. $10,400 B. $11,050 C. $15,300 D. $93,500 E. None of these - correct answers โœ”โœ”Safety Margin= Actual Sales - BE 85x - 51x - 37400= 0 37400/ 34x= 1100. 1100(85)= 93500= BE 1230(85)= 104550= actual sales 104550 - 93500= 11050 B. $11,
  3. Cost-volume-profit analysis assumes that: A. total costs are constant as activity changes. B. the average fixed cost per unit is constant as activity changes. C. the average variable cost per unit is constant as activity changes. D. variable costs are nonlinear.
  1. Thai Two sells hot pots for $40 each. The company incurs monthly fixed costs of $5,000. The contribution margin ratio is 20%. Based on this information, what is the variable cost per hot pot? - correct answers โœ”โœ”CMR= CM/SellingPrice .2= (40-x)/ 8= 40-x x= 32
  2. A company's plan for the acquisition of long-lived assets, such as buildings and equipment, is commonly called a: A. pro-forma budget. B. master budget. C. financial budget. D. capital budget. E. rolling budget. - correct answers โœ”โœ”D. capital budget.
  3. Which of the following budgets are prepared before the production budget? Direct Materials Budget - Sales Budget - Cash Budget A. Yes Yes Yes B. Yes Yes No C. No Yes Yes D. No Yes No E. No No No - correct answers โœ”โœ”D. No Yes No
  4. Consider the following statements about the budgetary slack:

I. Managers build slack into a budget so that they stand a greater chance of receiving favorable performance evaluations. II. Managers can build slack into a budget by underestimating revenues. III. Managers can build slack into a budget by overestimating expenses. Which of the following statement(s) is (are) true? A. I only B. I and II C. II and III D. I, II, and III E. None of these - correct answers โœ”โœ”D. I, II, and III

  1. When an organization involves its many employees in the budgeting process in a meaningful way, the organization is said to be using an approach most commonly known as: A. employee-based budgeting. B. budget padding. C. imposed budgeting. D. budgetary slack. E. participative budgeting. - correct answers โœ”โœ”E. participative budgeting.
  2. Virginia Enterprises makes all purchases on account, subject to the following payment pattern: Paid in the month of purchase: 30% Paid in the first month following purchase: 60% Paid in the second month following purchase: 10% If budgeted purchases for January, February, and March are $200,000, $180,000, and $230,000, respectively, what are the firm's budgeted payments in March? A. $69,000 B. $138,000 C. $177,000 D. $197,000 E. None of these - correct answers โœ”โœ”200000(.1) + 180000(.6) + 230000(.3)= 197000 D. $197,
  3. The company had 3,000 units in finished-goods inventory on December 31. The following data are available for the upcoming year: January February Units to be produced 9,400 10, Desired ending finished-goods inventory 2,500 2, Budgeted sales for January would be:
  1. Greenwich Corporation manufactures a product requiring 0.5 ounces of platinum per unit. The cost of platinum is approximately $360 per ounce. The company maintains an ending platinum inventory equal to 10% of the following month's production usage. The following data were taken from the most recent quarterly production budget: July August September Planned production in units 1,000 1,100 980 The cost of platinum to be purchased to support August production is: - correct answers โœ”โœ”1000(.5)= 550 oz DEI= 10% of Sept= (980.1) * .5= 49 BEI= 10% of Aug= (1100.1) * .5= <55> 550+49-55= 544 544oz* $360/oz= $195,
  2. A favorable labor rate variance is created when: A. actual labor hours worked exceed standard hours allowed. B. actual hours worked are less than standard hours allowed. C. actual wages paid are less than amounts that should have been paid for the number of hours worked. D. actual units produced exceed budgeted production levels. E. actual units produced exceed standard hours allowed. - correct answers โœ”โœ”C. actual wages paid are less than amounts that should have been paid for the number of hours worked
  3. Consider the following statements: I. Behavioral scientists find that perfection standards often discourage employees and result in low worker morale. II. Practical standards are also known as attainable standards. III. Practical standards incorporate a certain amount of inefficiency such as that caused by an occasional machine breakdown.

Which of the above statements is (are) true? A. I only. B. II only. C. III only. D. II and III. E. I, II, and III - correct answers โœ”โœ”E. I, II, and III

  1. Consider the following statements about variance investigation: I. The absolute size of a variance is more important than the relative size when trying to decide what variances to investigate. II. A manager is more likely to investigate the variance of a cost that is controllable by someone in the organization than one that is not. III. A statistical control chart can be used for determining whether a particular variance should be investigated. Which of the above statements is (are) true? A. I only. B. II only. C. III only. D. II and III. E. I, III, and III. - correct answers โœ”โœ”D. II and III.
  2. Which department would normally begin an investigation regarding an unfavorable materials quantity variance? A. Quality control. B. Purchasing. C. Engineering. D. Production.

AH=

SH= 8900u* 5hr/u= 44500 DLEV= SR(AH-SH) 14(45000-44500)= 7000 B. $7,000 U.

  1. Consider the following information: Standard price of direct material $3 per gallon Standard direct material quantity 2.5 gallons per unit Actual production 200 units Direct-material price variance $300 U Direct-material quantity variance $420 F How many gallons of direct material were purchased and used? - correct answers โœ”โœ”SQ= 2002.5= 500 SP= 500 3= 1500 QV= AQ-SP 420= AQ- AP= $ AQ= 1080 / $3/gallon= 360gallons
  2. St. John Company manufactures a single product with the following unit standard related to direct labor: Standard hours 2 hours per unit Partial production data for the most recent month are shown below: Budget Actual

Production (units) 500 450 Direct labor hours 1,000? An analysis of results for the month included the following variances: Direct labor rate variance $1,920 Unfavorable Direct labor efficiency variance $600 Unfavorable If the company incurred $11,520 on direct labor costs, how many hours did the company work during the month? - correct answers โœ”โœ”LRV= (AHAR)-(AHSR) 1920= 11520-(AHSR) (AHSR)= 9600 LEV= (SRAH)-(SRSH) 600= 9600-(SRSH) (SRSH)= 9000 SH= 4502= 900 (SR900)= 9000 SR= AH*SR= 9600 AH= 9600/ AH= 960