1. Consider the following budget information: materials to be used totals $64,750; direct labor totals $198,400; factory...
Question:
1. Consider the following budget information: materials to be used totals $64,750; direct labor
totals $198,400; factory overhead totals $394,800; work in process inventory January 1, 2012, was expected to be $189,100; and work in progress inventory on December 31, 2012, is expected to be $197,600. What is the budgeted cost of goods manufactured?
a. $649,450
b. $197,600
c. $657,950
d. $1,044,650
2. Direct material of $170,000 and fixed factory overhead of $28,000 for 8,000 hours of production. The department actually completed 10,000 hours of production. What is the appropriate total budget for the department, assuming it uses flexible budgeting.
a. $378,000
b. $305,000
c. $350,000
d. $288,000
3. The budgeted finished goods inventory and cost of goods sold for a manufacturing company for the year 2012 are as follows: January 1 finished goods, $765,000; December 31 finished goods, $640,000; cost of goods sold for the year, $2,560,000. The budgeted costs of goods manufactured for the year is?
a. $2,435,000
b. $2,560,000
c. $1,405,000
d. $3,965,000
4. Ruben Company purchased $100,000 of Evans Company bonds at 100. Ruben later sold the bonds at $104,500 plus $500 in accrued interest. The journal entry to record the sale of the bonds would be:
a. Debit: Cash $105,000; Credit: Investment in Bonds $100,000; Gain on Sale of Investments $4,500 and Interest Revenue $500
b. Debit: Cash $105,000; Credit: Investment in Bonds $100,000 and Gain on Sale of Investments $5,000
c. Debit: Cash $104,500 and Interest Receivable $500; Credit: Investment in Bonds $100,000, Gain on Sale of Investments $4,500 and Interest Revenue $500 (Answer)
d. Debit: Cash $105,000; Credit: Investment in Bonds $104,500 and Interest Revenue $500
5. At the beginning of the period, the Cutting Department budgeted direct labor of $155,000, direct material of $165,000 and fixed factory overhead of $15,000 for 9,000 hours of production. The department actually completed 10,000 hours of production. What is the appropriate total budget for the department, assuming it uses flexible budgeting.
a. $416,000
b. $335,000
c. $370,556
d. $368,889
6. Jacks Corporation purchases $200,000 bonds plus accrued interest for 2 months of $2,000 from Kennedy Company on March 1. The bonds have an annual interest rate of 6% payable on June 30 and December 31. The entry to record the purchase of the bonds would include:
a. Interest Receivable debit $2,000
b. Investment in Bonds debit $202,000
c. Interest Revenue credit $2,000
d. Cash credit $200,000
7. 100 plus accrued interest of $2,000. On June 30, 2011, Albert received its first semiannual interest. On February 1, 2011, Albert sold $40,000 of the bonds at 103 plus accrued interest. The journal entry Albert will record on April 1, 2011 for the purchase of the bonds will include:
a. A debit to Investments - Tetter Company for $50,000 (Answer).
b. A debit to Investments - Tetter Company for $52,000.
c. A credit for Cash of $50,000.
d. A credit to Interest Payable for $2,000.
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