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1. The time interval between the instant data and the instant at which delivery a. Access time c. b. Idle time d.
at which an instruction control unit initiates a call for of the data is completed is Compliance time Throughput time
2. In computer operations, data is encoded before processing can be done by the computer. These statements refer to batch processing, except a. The processing of data collected in advance so that each accumulation is processed in the same run. b. The technique of executing a set of computer programs such that each completed before the next program of the set is started. c. The processing of related transactions that have been grouped together. d. The method of using the computer system that allows a number of users to execute programs currently and to interact with the programs during execution. 3. In computer data processing systems, these are the basic elements and components, except: a. Input/output devices c. Graphics card and adaptor b. Central processing unit d. Software, procedures and personnel 4. You are working with a task force which has been mandated to develop an integrated information system. The objective is to be able to harness computer power to make information available to the right person in the company at the right time at the most cost efficient manner. Your present assignment is to determine the proper grouping of the applications. What applications are not appropriately grouped? a. Sales, accounts receivable, salesman’s commission, cash receipts, marketing equipment modules b. Production planning and scheduling, raw materials inventory and container management, purchasing, sales forecasting modules c. Bank reconciliation, accounts payable, disbursements, fixed assets, general ledger and payroll modules d. Personnel information system, finished goods inventory, general ledger, non-trade receivables modules 5. The advent of computers has far reaching impact on the accountancy profession. Whenever considered, computerization demands extreme care to avoid the “horror stories” that may have experienced. Among the critical areas for careful study is systems design. Which of the following is not related to system design? a. It considers unnecessary emphasis on accuracy of certain types of economic data where the cost to generate exceeds the benefits produced. b. If there is too much breaking down of job functions, there will be time consuming rereading of data that must be understood before it can be processed. c. It is a symbolic presentation of the decision making process showing alternative solutions to a problem and the possible consequences. d. If identical information should be shown on different documents, it must be captured only once and recorded simultaneously. 6. There are different levels of business application systems in computerized operations. In many cases, the applications involve the integration of the transaction level of processing with such business functions as production, marketing, human relations and finance to provide the different level of people with the required information for planning and control. This level is called a. Transaction level c. Decision support system level b. Management information system level d. Office automation system level 7. The technology that permits a computer in one company to interface with another computer in another company, an application example of which is computerized billings and payments among companies is a. Transfer system method c. Electronic data interchange b. Integrated information systems d. Local area network 8. The general ledger system is considered the “hub” of all the systems because a. All the other systems capture their data through the general ledge system b. The general ledger system is the central system that provides all the vital reports to management and other interested parties c. All the other systems use the same documents and forms as the general ledger system
Plans can be continuously updated and planning horizons can be extended way beyond current period.475 yard of cloth per scarf.475 yards Airfreight from supplier Php 0.000 Calculate the net income or loss for the period from the above data. a.000 Calculate the total sources of cash of Bing and Lynn’s Store. Bing and Lynn’s Store is on the cash basis of preparing funds statement. Php 472. Rejects have no market value.30 13. uses the working capital basis of preparing if Funds Flow Statement. Integrated information system 12.87 b.000 c.500 Total uses of cash 454. Flexible enough to accommodate a variety of management styles b. These data are available: Decrease in working capital Php 50. a. 10. Php 492. Communications connectivity c. following data are presented for the year just ended: Depreciation expense Php 48. Executed according to pre-established production schedule d. All the other systems product output that becomes inputs to the general ledger system 9.21 d.500 d. Calculate the standard cost of cloth per scarf that Hankies Unlimited should use in its cost sheets.500 Gain on sale of equipment 9. Php 16. Php 68. certain data for an accounting system for instance.2 d. Hence. Decision support systems in a computerized environment have certain desirable characteristics except a. would be duplicated in an inventory system. These are some of its benefits except a.500 Working capital provided by operations 121. Supports decision-makers at all levels but is most effective at the tactical and strategic levels c. a. Php 17. Time-sharing system d. One of the most useful applications of computer technology is computerized budgeting.500 b.000 Increase in cash 25. There is no need to be precise in understanding the discipline and relationships in the organization and its accounting system c.500 b. Is capable of interfacing with corporate database 11.000 Repairs and maintenance 19. Boomie Co. Php 113. Php 479.90/yard Purchase discount from supplier 3% Sales discounts given to customers 2% The allowance for rejected scarf is not part of the 0. Significant reduction in time required in preparation and assembly is achieved through the use of modeling techniques b.76 c.000 Decrease in deferred income taxes 18.000 Cash dividends declared 27. Hankies Unlimited has a signature scarf for ladies that are very popular.000 Depreciation 13.000 d.500 The Php 14.60/yard Motor freight to customers Php 0. Data redundancy in such case is expensive.00 Allowance for rejected scarf 5% of production Yards of cloth needed per scarf 0.000 Amortization of bond discount 1. Certain production and marketing data are indicated below: Cost per yard of cloth Php 36.000 Sale of common stock 175. Php 18. Planning assumptions can be changed with cost and profit implications estimated before commitments are made d.500 c.000 . A function-based information system is designed for the exclusive support of a specific application area and its database and procedures are often independent of other systems.500 Amortization of patents 12.000 Bonds payable issued 90. Wide area networking b. Php 467. 351. Php 17.000 Cash dividends paid 34. Materials are used at the start of production. minimizes data redundancy and enhances interdepartmental activity coordination is a.000 Purchase of land 310. Php 86. The information system which shares a common database.
CP is Php 0.000 d.700 favorable.820 favorable. Favorable price variance.6 million “Tac”. what will be the likely effect? a. The Table Top Model Corp. Unit costs applicable to these hoses are: Direct materials Php 35. SV is Php 0 favorable.000 hoses are required for the year. and CV is Php 9.84 million Quantity Budget Actual 45. As to the material variances.000 annually. and CV is Php 5.: • Taxes payable: Beginning of year Php 6.000 274. favorable usage variance b.000 5.765 • Tax expense per income statement 20.00 Variable manufacturing overhead Php 9. sales volume (SV).300 25. Buy. unfavorable usage variance c. because there will be savings of Php 5. Buy. SV is Php 9.00 per hose c. you found these data belonging to the Blue Sky Co. Cash used to pay taxes must have been Php 22.60 per hose b. produces three products.800 Variable Costs (Php) 3. the Purchasing Manager decided to buy 65.000 • General and administrative expense 155.00 a piece.900 Total 80.000 a.00 Fixed manufacturing overhead Php 21.000 • Taxes payable: End of year 4. No effect on price variance. As you are doing an analysis of the cash flow.820 favorable.900 108. and “Toc”. favorable usage variance 18.000 favorable c. buy or make the hoses? Why? a. “Tic”. CP is Php 5.00 General and administrative cost Php 16.820 favorable. c. Make. unfavorable price variance d. Favorable price variance. cost price (CP) and cost volume (CV) variances: a. The owner desires to reduce production load to only one product line due to prolonged absence of the production manager. the following were taken: Cost of Sales Budget Actual 270.800 15.700 favorable.3 15. and CV is Php 900. because there will be savings of Php 3. there will be a savings of Php 6.300 10.000 81. Other fixed operating expenses amount to Php 660.000 9.700 favorable. and CV is Php 0 unfavorable b. Depreciation expense amounts to Php 600. Make.04 million “Toc”. product must be retained and what is the opportunity cost of selecting such product Retain Retain Retain Retain product product product product “Tac”. From the records of Green Ann Co.000 700.120 Co.700 180.820 unfavorable d.14 million “Tic”’ opportunity cost is Php 4. 5.700 8.00 per hose .40 per hose d.000 favorable Product Green 17. SP is Php 5.000 398. SP is Php 36. CP is Php 36. The general and administrative expenses must be understated c.800 Sales Budget Actual 450.000 19.700 393. Red Nose Co.800 655. SP is Php 9.900 1.700 favorable.000 bags of flour with a quality rating two grades below that which the company normally purchased. e. Should Red Nose Co.000 27.000 per year. SV is Php 36.900 Which line? a. because there will be savings of Php 31. b. “Tac”.00 Direct labor Php 20. opportunity cost is Php 4.000 • Interest expense 50.80 0 Ann 30.000 favorable. The sales and variable cost data of the three products are (000’s omitted): Tic Tac Toc Sales (Php) 6. Unfavorable price variance. For the doughnuts of McDonut Co. opportunity cost is Php 4. CP is Php 0 unfavorable. SP is Php 36. makes hoses for its sprayers.000 55.000 favorable..000 458. The deferred tax account must have a debit balance b.000 96. The hoses can be bought for Php 70. Tax expense must have been inaccurate 16.000 45.000 26. SV is Php 5. The space that is used for the hoses production can be used as warehouse and will save rental cost of Php 48. This purchase covered about 90% of the flour requirement for the period.82 0 Determine the sales price (SP). opportunity cost is Php 3.000 186.000 per year.00 5.
00 per unit.90 2.00 0. Fixed factory overhead has been overapplied 620. owns a large processing line which segregates coconuts into its components upon contact with the breaker of the machine. None because all will incur losses 22.75 12. Php 1.15 c.000 The accountant estimated that the order will result as follows: Revenue Php Differential cost of goods sold Direct materials Php 180.00 0.03 0.25 Unit selling price Php 134.000 (20.000 Additional lease cost for additional equipment required for the special order. Coconut meat only because it will give total profits of Php 12.00 3.4 20. Produce Product Y and market at Php 80. Marketing believes this new product can be sold for Php 80. Php 1. These data pertain to Belle Corp. you gathered the following data per unit: Meat Juice Shell Husk Selling price (Php) Allocated joint cost Profit 4.000 Variable factory overhead 50. production has developed Product Y with the same cost structure as Product X.97 The study shows that after further application of additional manufacturing process. Coconut meat only because it will give incremental profit of Php 4. Market Product Y if the price can be increased to at least Php 99.000 (70.13 3.00 0.000 Variable marketing expenses Loss on this order The calculation has these problems: a.50 10. Coco Co. Do not market Product Y because the company will lose b.50 Fixed general and administrative expense. “buko juice” for the juice. Presented are these data: 1.00 if the fixed selling and administrative expenses can be eliminated 21. At the segregation point. Php 800. the following is projected: Meat Juice Shell Husk Selling price (Php) Additional processing cost 12.’s Product X: Direct labor Direct materials Fixed manufacturing overhead Variable manufacturing overhead Variable selling expenses Fixed selling expenses Variable distributions expenses Fixed distribution expenses Total unit cost Php 32.000 Direct labor 140.00 5. 6. Labor. Interest rate is 12% Which product should go through the additional manufacturing process? a. Presently. Php 0. 3.00 Since the plant has excess capacity. has an offer for a special order of 100.25 6.50 5. 7.000) . All products because all will give additional profits c. Php 10.000 units at a unit price of Php 6.000 600.06 1. It will be logical for Belle Corp.40 Variable factory overhead per unit. Ham and Sam Co. 450. 5.000 at 100% capacity Variable direct costs per unit are: Materials.87 2.15 22.95 Fixed cost of the plant amounts to Php 500.00.20 per coconut b.80 4. Produce Product Y and market at Php 80.00 d. A feasibility study is being made to process its components into “buko pies” for the meat.95 2.000. Present production at 85% capacity.250.00 1.80. to this in the short run: a. it sells the coconut meat.00 0.03 0. juice. 2. shell and husk to various manufacturers.000 units Fixed factory overhead is Php 1.10 Php 99. 4. flower pots for the shells and fuel briquettes for the husk.00 2.97 1.000 Fixed factory overhead 250.80 4.08 per coconut d.50 Variable marketing expense per unit.00 1. Php 0.000) 50.94 1.
Below are certain manufacturing and selling expenses 1. 2 and 3 only b. Ordering cost: Php 5. Purchase cost per bag: Php 1.000 d. Fixed factory overhead has been allocated and additional lease cost has been ignored 23. 50. 8. All except items 5 and 6 d. because income will be reduced by Php 13. contemplates the temporary shutdown of its plant facilities in a provincial area which is economically depressed due to natural disasters.000 cases.000 Should the company allow revision of its credit terms? a.50 3. It is more useful for analyzing the interrelationships of time and activities to discover potential bottlenecks. Cost b. Determine the economic order quantity (EOQ). Security of premises 4. He estimates the following effects: • Sales will increase by at least 20% • Accounts receivable turnover will be reduced to 8 times from the present turnover of 10 times • Bad debts. because income will increase by Php 64.400 bags c. 2. Which of the following statements is the least pertinent to the Program Evaluation Review Technique (PERT)? a. 5. 52-week year).000 tea bags a year. Depreciation 5. a. Dependent variables 25. Php 3. now at 1% of sales will increase to 1. and generally described as a. d. c. These constraints must be fully specified before a linear programming problem can be solved. No. Carrying cost: 20% of unit cost 5. 4.5% of sales. Property taxes 6. Insurance of facilities Which of the following expenses will continue during the shutdown period? a. Average lead time on purchases: 6 days What is the reorder point if the company will keep a 10-day safety stock of inventory? a. 3. the following are available: prior year’s purchases. because losses will be increased by Php 28.800 b. EOQ is 500 cases.50 2. The China Tee Store sells 100. From the route book and other records. suggests that certain credit terms be modified. Interest expense 7. 6 and 7 only 24.000. Resources c. It involves measuring progress in relation to schedule.800 c. (Use 365-day. which uses network analysis and critical path methods. weekly demand is approximately 962 cases.400 bags d. Php 1. Selling price per bag: Php 2. Lease cost has been ignored and fixed factory overhead has been overapplied d. Yes. EOQ is 481 cases.20.000 27. 26. distributor’s discount.00. carrying cost per case of inventory. 1 case for every 10 cases bought. 2. Yes. All expenses in the list c.400 bags b. EOQ is 962 cases. before the proposed change is at Php 900. cost of placing an order. forecasting future progress and predicting and controlling costs. Inefficiencies d. b. Number of days the company operates in a year: 250 6. evaluating changes to schedule. Additional data are presented below: 1. The Mark X Corp.5 b. because losses will be reduced by Php 78. Sales commissions 2. Items 1. Fixed expenses amount to Php 150. Safety stock required is 140 cases.800 bags 28. and the reorder point assuming a two day lead time. reorder point is 414 cases c. The Sales Director of Can Can Co. Variable cost ratio is 55% and desired rate of return is 20%. Linear programming models are mathematical techniques in which an objective function is maximized or minimized subject to constraints. reorder point is 275 cases .40 an order 4. It is a system. reorder point is 500 cases b. No. A soft drinks distributor which buys in a pre-sell basis is discussing with the route salesman on the proper cases to be ordered and the frequency of call. Items 1. 6. Time is a primary consideration and this technique is particularly suited for problems. No change in demand is expected this year. Delivery expenses 3. which involve the combination of resources that maximize profits or minimize costs. Fixed general and administrative expenses and incremental lease cost have been ignored c.
b. PI will decrease. capital budgeting decisions.344 7. That the status of quantities on hand must be periodically reviewed where high value or critical items are examined more frequently than low-cost or non-critical items b. or a decrease in cash outflows. 3.639. Due statements A and C above 32. The table of present values of Php1 received annually for 8 years has these factors.871 35. Items 1 and 3 only c.17 years c. Payback period (PP).344 d. The most likely reason is: a.: 16% 6. a. d. Disposal value after 8 years: nil 3. and SARR will have no change 33. Economic life of equipment: 8 years 2. a decrease in investment cost. PI will increase with an increase in cash inflows. and SARR will increase b.000 for year 3. or an increase in cash outflows.17 years . 3. and SARR will have no change c. and Php 30. an increase in investment cost. or a decrease in cash outflows. That it is impractical to give equal attention to all stock items.000 for year 1.501 c. Php 5. PI will decrease with an increase in cash inflows.5 years b. There is higher tax rate in year 5 d. an increase in investment cost. PP will increase. PP will decrease. PP will have no change. 2. Php 30.6 d. reorder point is 280 cases 29. Items 1. In 1. whose management is planning to purchase an automated tanning equipment: 1. hence the need to classify and rank them according to their cost significance 30. the following items are considered. What is the effect of changes in cash inflows.000 for year 4 • Initial investment outlay is Php 60. Given these data: • Net after tax inflows are: Php 24. PI will decrease with an increase in cash outflows. PI will increase with an increase in cash outflows. Depreciation is approximately Php 46. c. Your company is purchasing a transportation equipment as part of its territorial expansion strategy. The time value of money is considered b. Cost of capital of Sunlight Corp.000 • Cost of capital is 18% Determine the payback period for this investment. a. EOQ is 250 cases. at 14% = 4. PP will have no change. 2. not in year 5. There is lower tax rate in year 5 c.501 b. at 16% = 4. investment cost and cash outflows on profitability (present value) index (PI)? a. That the quantities of most stock items are subject to definable limits d. It is a quest towards continuous improvement in the environmental conditions that necessitate inventories c. 3. Estimated net annual cash inflows for each of the 8 years: Php 81. a decrease in investment cost. Php 5. Time-adjusted internal rate of return: 14% 5. 4.00 years d. PI will have no change. 31. The technical services department indicated that this equipment needs overhauling in year 4 and year 5 of its useful life. or an increase in cash inflows. All items b.000 4. The overhauling cost will be expected during the year the overhauling is done. PI will increase. Php 36. and SARR will decrease d. 2. What is the effect of an increase in the cost of capital on these techniques? a. Php 4. The underlying philosophy of “just-in-time” inventory system is a. 3 and 4 only 34. PI will decrease. Items 3 and 4 only d.970 annually Find the required increase in annual cash inflows in order to have the time-adjusted rate of return approximately equal the cost of capital. among others: Cash outflow of the investment Increase in working capital requirements Profit on sale of old asset Loss on write-off of old asset For which of the above items would taxes be relevant? a. profitability (present value) index (PI).000 for year 2. Php 6. The following data pertain to Sunlight Corp. and simple accounting rate of return (SARR) are some of the capital budgeting techniques. The Finance Officer insists that the overhauling be done in year 4.
000 payable at the end of each of the 5 years. The payback reciprocal is an estimate of the internal rate of return.000 P210.000 38.944 28721 29. Tropez Co.235 122.500 27. If purchased.159 18.400 255.305 119.700 annually over its life of 5 years. Buy the machine because depreciation saves Php 10.703 32. Lease the machine because outlay is less by Php 51.500) (13.316 281.163 21.566 P310.596) 126. The Bravo inc.2% 38.500 103.657 Prepaid Assets 14. 18.366 20.704 P12.717 36.300 Estimated useful life 10 years 10 years The company’s income tax rate is 35% and its cost of capital is 12%. Present value of Php1 received annually for 5 years at 18% is 3.138 c.000 120.794 P250.500 44.363 95. 22. plans to replace its old sing-along equipment.500 P10.5% b. The company’s cost of capital is 14% and income tax rate is 35%.807) (14.000) b. end of useful life 2.505 P233. Annual cash returns on investment cost of Php 1.000 16.944 P39.000 Current salvage value 10. These information are available: Old New Equipment cost (Php) 70.027 22.000 P210.7 36.600 134. Lease the machine because leasing saves Php 2. There is no salvage value.000 12.856 95.490 79. Cost of money is 18%.815) (145.500 70. What is the present value of all the relevant cash flows at time zero? a. What will you recommend and why? a.759 52.000 Accumulated depreciation 55.745 88.700) 37.614 (140.630 291. Val Yu is an entrepreneur who is contemplating to buy a machine to increase the capacity of his manufacturing operations. (Php 54.379 15.587 P53.000) d.000 P271.081) (15. Useful life is estimated at 8 years.000 Annual operating costs 56.547 Trade receivables 46.000 16.805 P48.439 79. He consults you for advise on the alternatives of leasing or buying the equipment.200 114.000) c.500 The following financial statements pertain to Blue Grass Corp. (Php 120.936 18. The annual lease payments will amount to Php 29. the straight line depreciation expense will be Php 18. 11.437.930 18.623 29882 P300. (Php 124. Calculate Bravo Inc.211 28.839 80.985 Total current assets Property Plant and Equipment Other assets Total Assets LIABILITIES Accounts Payable and accrued expenses Loans payable Total Liabilities STOCKHOLDER’S EQUITY Capital stock Retained Earnings Total Stockholder’s equity Total liabilities and s/e INCOME STATEMENT Volume Revenue Discounts Net revenue Direct cost of sales Manufacturing expenses Gross profit Operating expenses Distribution 119.’s payback reciprocal for this investment: a.035 . Tax rate is 35%.500 18.000 80.695 91. 20.000. Lease the machine because leasing saves Php 27.422 P233.298 Non-trade receivables 16.9% d.817 b. It is the start of the year and St. Present value of Php1 due in 5 years at 18% is 0. Mr. is considering the acquisition of merchandise picking system to improve customer service.205 12.000 Salvage value.600 16.300 each year d.700) (127. for the year 1993 (000’s omitted): BALANCE SHEET 1993 ASSETS Actual Plan Year Ago Cash and marketable securities P18.015 P105.490 79.3% c.794 P250.700 19.127.2 million are Php 220.876 Inventories 23.734 130.207 115. ((Php 110.490 25.842 128.
B. Gross customer spending at the vending machines is estimated to be 40% greater than the current sales because the vending machines are available at all hours.000 units of Product JI and 30. c. The operations of the cafeteria requires fixed costs of P470.702 P24. volume of discounts given and increase in cost of sales. and round off 2 decimal places): a.000 per month and variable costs of 40% of sales.719) Profit before tax 21. percentages and other indicators. the company holds inventories for the following number of days before they are sold (use a 360-day year. deteriorated versus year ago and improved versus plan.509 Interest expense (15. P258.600 70. and 53. improved versus year ago and improved versus plan. 55.000. 90. d. 000’s are omitted. 60. 41.363 13.912 Marketing 14. Below are some information: JI JII Unit selling price without further processing P24 P18 Unit selling price with further processing 30 22 Total separate weekly variable costs of further Processing P100.48 days in 1992. after increase in selling price of 15%. c.000. Days’ sales outstanding compared with plan and year ago has (use a 360-day year. increase in cost of sales and volume of discounts given. each product has a selling price of P160 per unit but product A has 40% contribution margin and product B has a 70% contribution margin. the company would receive 16% of the gross customer spending and avoid cafeteria costs. 46. 43. and round off to 2 decimal places): a. P182. d.6 days in 1993. The revenue in 1993.190 P17. c. b.065 37.15 days in 1992. deteriorated versus year ago and deteriorated versus plan. decrease in selling price amounting to 15% compared with 1992.000 To maximize Julius’ manufacturing contribution margin.000 units of JII for which P800. There appears to be a need to drastically reduce inventories considering a.77 days in 1993. 44. which product or products should the limited number of machine hours be used for? a. A.100 29. as is 39. 37. These two products can be sold as is or processed further. improved versus year ago and deteriorated versus plan. b.547) (14.000.000. increase in prices.06 days per plan. d.58 days per plan.500 13. S Kent Co. Chow Foods operates a cafeteria for its employees. and 36. Cafeteria sales are currently averaging P1.8 Selling 39. c. d.088) (13. reduction of sales volume and deteriorating days’ sales in inventories.200. One unit of B takes twice as many machine hours to make as a unit of A. 59.000.37 days per plan. P90. b. the total separate variable costs of further processing that should be incurred each week are a.688 (2.010 9.9 days in 1993.000 per month. Assume either product can be sold in whatever quantity is produced. versus 1992.22 days in 1992. decrease in volume of 1. Further processing of either product does not delay the production of subsequent batches of the joint products.702 Net operating profit 39.800.66 days in 1993. 37. A decision to replace the cafeteria with vending machines will result in a monthly increase (decrease) in operating income of a. Both and B. due to inflationary forces. The company has the opportunity to replace the cafeteria with vending machines. d. c. By replacing the cafeteria with vending machines. P18.082 15.000 common variable costs are incurred.633 9.816) 1.65 days in 1992. P(588. P190.200 27.800. and 35. Normal annual production for the item is 100.306 80.428 34. 89. P100.000 units. ratios. b.376 Income tax 7.595 General and administrative 5. b. produces Component 6417 for use in one of its electronic gadgets.428 49. d.59 days per plan.572 Profit after tax P13. Julius International produces weekly 15. has a limited number of machine hours that it can use for manufacturing two products. b. b. 56. decrease in volume.161 units. 42. The cost per 100 unit lot of the part are as follows: Direct materials P520 Direct labor 200 . decreased due to a. and 54.000).804 For amounts and volume.300 8. Based on the number of days’ sales in inventories. c. P95. in general. 45. A and B.000 P90.600 43.414) Other income (expense) (2. d. 40. c. Either A or B.159 Total 87. deterioration in days’ sales outstanding and volume of discounts given. Pixie Co. consider ending inventories as the average balance. consider ending trade receivables as the average balance.
how much would be the receivables balance? a. both of which must pass through the Assembly and Finishing Departments. Its purchases total P2.000 The best project is a. minimize 90X + 135Y. 40 percent on the thirteenth day. In addition. P94. has offered to sell Pixie all 100. The collections manager estimated that 30 percent of the customers pay on the tenth day and take discounts.2 Net present value P 600. If X represents the number of units of Component 818 and Y represents the number of units of Component 810.9 Manufacturing Overhead: Variable 240 Fixed 320 Total Manufacturing Cost per 100 units P1. 40 days after the purchase. minimize 30X + 45Y. N. If management would toughen on its collection policy and require that all nondiscount customers pay on the thirtieth day. and the remaining 30 percent pay. Workers in the Assembly department work a total of 200 hours per week. Bachoy & Co. buy component 6417 because of P140. If its sales for the period just ended amounted to P972. and the remaining 30 percent pay. Simba Corp.000 d. what is investment in accounts receivable? (Assume 360 days in year). This change would save Pixie P180. P120. If Pixie accepts the offer from Bobbie. continue producing Component 6417 because of P60.000 sold on terms of 3/10.0 d d.000 cost item included in fixed overhead is specifically related to Part 6417 and would be eliminated. P180. Hakuna Inc. b.000 savings.000 c.200. The capital costs for the initiation of each mutually-exclusive project and its estimated after-tax.000 in relevant costs. 20 days. Assuming 360 days a year. is contemplating four projects: L. Gross sales for the year are P2.000 b.000 savings. maximize 120X + 180Y. 51. The company wants to know how many units of each component to produce to maximize profit. The following constraints apply: Unit Selling Contribution Margin Hours Required Per unit Product Price per Component Assembly Finishing Component 818 P120 P30 3 4 Component 810 P180 P45 4 6 Demand for Component 818 far exceeds the company’s capacity. Telephone Corp. what is the average collection period? a. b. b. P 60. Proposal A because it has the highest net present value even though its investment base is e smaller. and workers in the Finishing department work a total of 250 hours per week. d. but generally does not pay until 40 days after the invoice date. d. net cash flow are . whose gross sales amounted to P1. 48. c.000 and the collections department estimates that 30 percent of the customers pay on the tenth day and take discounts. 47. 27 days. Proposal B because its profitability index is over 2. P240. the objective function would be a.000.280 Bobbie Inc. P72.200 b.000 units it will need during the coming year for P1. a P200.160. Assuming 360 days per year. Ten Q’s Inc. Zero. net 30. Phil-Fuji Co. 40 days. continue producing Component 6417 because of P40. buy component 6417 because of P300. c. 49.1 Net present value P 300. 15 days. buys on terms 2/10.000 52. P70.000 Proposal B Investment P1. and a payments cycle to 26 days.000 savings. 40 days after the purchase. 40 percent pay on the thirtieth day. b. d.000 Profitability index 2. has an inventory conversion period of 60 days.000 c. A capital budgeting decision model has provided the following information: Proposal A Investment P1.000 savings.450 c.800. P85. P60. P79. but the company can only sell 60 units of component 810 each week.400. c. M. c.000 per year. and O. 53. Proposal A because it has the highest net present value.000 b. maximize 30X + 45Y. net 30. the facilities used to manufacture Component 6417 could be used in the production of Component 8275. on the average. on the average.000 d.500 d. a receivable conversion period of 35 days. manufacturers two types of electronic components. sells on terms of 3/10 net 30 days. P80.200 per 100 units..600 50. the amount of “non-free’ trade credit used by the company on the average each year is a.000 Profitability index 1. Proposal B because it has the highest profitability index.000. a. Pixie should a.
change by 15%.2328 The company should a. one employee will have to be retained with an annual salary of P150.6% Excess present value index 1. If this would happen. decrease.8526 Present value of annuity of P1 4.000 Depreciation on equipment 325.10 listed below. Assume the company uses straight-line depreciation for taxes and that the appropriate tax rate is 35%.500. Idle funds cannot be reinvested at greater than 12%.000. 5 reported the following results of operations for the period just ended: Sales 2.500.000. not purchase the machines due to negative NPV of P172.540 P59.000 capital budget for the year.6% 17.2 million Selling and administrative P0. Sari-sari Corporation is a multiple-product firm.000 Contribution margin 1. they decided to shift the sales mix from less profitable products to more profitable products. LY & Company completed its first year of operations during which time the following information were generated: Total units produced 100. c. Projects L and N. is considering the purchase of some new machines.625. Projects M and N. not change.7 million Per unit variable costs Raw materials P20. In their review of operations. b.000 Net income (loss) (P125. 54. d. be indifferent as the option does not bring about any advantage nor disadvantage. increase.000 Less: Variable expenses 1. not be dropped due to foregone overall income of P25.000. b.000 Less: Fixed expenses Salaries and wages P750.500. The required after-tax rate of return is 14%. c. not be dropped due to foregone overall income of P350.13 1. 57.00 Direct labor 12. Nakinnat Corporation’s Outlet No.654 P54.000) The management is contemplating the dropping of Outlet No.907. be dropped due to overall operational loss of P25.000 additional revenues but yearly expenses for additional labor and materials would also increase by P11. be dropped due to foregone overall income of P325. c.715.00 .3506 Future value of P1 2.000. c. accounting for 30% of gross sales.14 0. not purchase the machines due to negative NPV of P984. The machines would cost P4.000. The company’s desired after-tax opportunity costs is 12%. Projects M.2% 10.708) Internal rate of return 12.000 Total units sold 80. Projects L and M.000 1.000.666 P(15.96 The company will choose a. The equipment has no resale value. Outlet No. b.7% 17. Once set up. The General Manager of Tela Mills Inc.000. 56. d.000 with an economic life of 8 years without any salvage value. 5 due to the unfavorable operational results. The following data are for an interest rate of 15% and 8 periods: Present value of P1 0. This will cause the company’s break-even profit to a. purchase the machines due to positive NPV of P638. N and O.02 1.6389 Future value of annuity of P1 13. they would generate P12.000 at P100 per unit Work in process ending inventory Costs: Fixed costs Factory overhead P1.000. It has P900.000 Advertising 500. 55.000 Insurance on inventories 50.50. b. 5 should a. d. d.900.50 Factory overhead 7.50 Selling and administrative 10. In Thousand Pesos L M N O Initial cost 400 470 380 420 Annual cash flows Year 1 113 180 90 80 2 113 170 110 100 3 113 150 130 120 4 113 110 140 130 5 113 100 150 150 Net present value P7.500.
P2. c. 58. due to the resulting loss of P37. due to incremental income of P30. c.000 units at P600 each. 63. did not borrow since its ending balance amounted to P200. c. are 2/10. P550. Its purchases total P3. d.000 Dividends paid in July P240.000 incremental income.000 Manufacturing costs: Variable P500 per unit Fixed P360.000. F&S.000 It was the company’s policy to keep a minimum cash balance of P200. The following historical pattern on its credit sales of Rainy Co. had to borrow P60. c. b.000.800 units of output.000. 60. P736.000 September 160.000 c. b.000.000 units at P630 each.000 Assume there would be no effect on regular sales at regular prices and that the usual sales commission will be reduced to half. No. P350.000 Depreciation expense in July.000.000 incremental income. 21.000 per year. P900. Inc. The present sales would not be affected by the special order. Unit costs at capacity are: Direct materials P100 Direct labor 150 Variable overhead 75 Fixed overhead 75 Marketing fixed costs 175 Marketing variable costs 90 Present monthly sales are 39.780. DTES Company’s budgeted sales and budgeted cost of sales for the coming year are P14.000.000 incremental income.000 August 140.000 December 170. P2. P1. Short-term interest rates are expected to average 15%.000. the operating income would be a. 24. did not borrow since its ending balance amounted to P230. Accept the special order due to P215.480. 18. The company a. P345. Yes.000 Purchased equipment for cash in July. Yes. Either on would do as the net effect would be the same. d.714. Accept the special order due to P110.000 Merchandise purchases paid in cash in July. 61. Nore Milling Co.000 October 180. Josh Corporation contacted Nore about purchasing 40. has an annual capacity of 2.000. has a plant capacity of 40.600.000 Marketing and administrative costs: Variable (sales and commissions) P120 per unit Fixed P40.4 million and P9 million respectively.124. b. Inc. d. d. P90. The following information were made available for Futuristic.100.90%. b. cash balance.000.000 Cash collections in July.000 November 200.000 units at P760 each P1. had to borrow P200. Accept the special order due to P185.040. Its predicted operations for the year as follows: Sales 2.000 incremental income.000 units per month. Assuming 360 days a year.: June 30. c. 62. P460. b.36%. Accept the special order due to P10. due to incremental income of P48. If . b.000. P4. d.000.000 Cash expenditures in July for operating expenses. P3. 59.000.000. the approximate cost of the “non-free” trade credit amounts to a. P502.800.000. net 30 but generally the company does not pay until 40 days after the invoice date.520. P1.50%.40%. was presented: 70% collection during the month of sale 15% in the first month after sale 10% in the second month after sales 4% in the third month after sale 1% uncollectible The sales on account of the last six months of the year were reported as follows: July P120. d. Nore should a. 19.11 If the company used the variable (direct) costing method. Should the company accept at one-time-only special order for 600 units at a selling price of P640 each? a.000 The total cash collections during the fourth calendar quarter from sales made on account during the fourth calendar quarter would be a. The official terms of purchases of U Tang & Co.
600 12.000 + (P0.000 b. P4. 100 units c.800.000 Sales 240.000 9.000 288.000). adopted the following budgeted formula for estimating shipping expenses.500 64.400 65. Lakas Engines Co.05 400 .850. P345.2 million units. The peso value that best quantifies the marketing division’s failure to achieved budgeted performance for the year is a.250 b.000 Direct labor 300. Should there be a next contract for this engine. P1.000 b.000 d.000 and annual operating cost of P1. P292.000 unfavorable d. P330. Premised on past experience Mayo Corp. Selling price is at P20 each and the contribution margin ratio is 30%. costs P87.000 per order.340 d.000 69.000 unfavorable b. P90. manufactures engines for the military equipment on a cost-plus basis. P11. 25% 68.000 per year. P816.500 c. currently has annual cash revenues of P2.000 Fringe benefits on direct labor 30. P300.000 c.000 unfavorable c. came you for help in establishing a minimum desired rate of return to be used in the evaluation of a capital project with a five year life. P1.000 d. 21% c.000 Rent 22.000 Depreciation 24.000. P10. 200 units d. The probability of stockout at various levels of safety stock is Units of safety stock Probability of stockout 0 . 300 units 67. The cost a particular machine the company manufactures is shown below: Direct materials P400. 20% b. P10. Casablanca Inc.30 200 . P730. has a practical production capacity of two million units.44 million units and sales of 1. Assuming a 35% income tax rate. The current year’s budget was based on the production and sales of 1.000 Overhead: Supervisor’s salary 40.500 units of product 24 times a year at a cost of P5.4 million units during the current year. Actual statistics came out to be production of 1.000 Total P816. P67.12 the company can increase inventory turnover from its present levels of nine times a year to a level of twelve times a year.000 Total pounds shipped 9. Kon Fuse Inc.400. P700.25 x Kgs.440. shipped) Pertinent data for the current month are given below: Planned Actual Sales order 800 780 Shipments 800 820 Units shipped 8.01 The optimal safety stock level for the company is a.500 d.200. P770. and the supervisor will be laid off. P10.075 c. The carrying cost per unit of inventory is P250 per year. The following data were provided: Inflation rate for the past 5 years 13% Expected inflation rate for the next 5 years 9% “Risk-free” element 5% “Risk” premium demanded for the project 7% You will advice the client to consider a minimum desired rate of return of a. The company’s shipments averaged 12 kilos per shipment (Shipping costs = P8. P60. You just passed the CPA licensure examination and took your oath.000 per year. the company should bid a minimum price of a. P37. Each stockout of Product AX sold by Axiom Inc.000 . P4.50 f 100 . Arlene’s annual incremental after-tax cash flows from the machine would be a. As you started your practice.000 b. 16% d. The company is considering the purchase of a new machine costing P1. its cost savings in the coming year would be a.000 c.000 If the production of this engine were discontinued the production capacity would idle. 0 units b.300 The actual shipping costs for the month amounted to P10. The new machine would increase depreciation to P500.200.500 per occurrence.000 (all cash items except depreciation of P350. The appropriate monthly flexible budget allowance for shipping costs for purposes of performance evaluation would be a.000 unfavorable 66.500. Arlene Inc. and the company orders 1.14 g 300 .
manages five upscale townhouse in Makati. Shown below are the summary income statements for each complex. Inc.220) (2. Three. In Thousand Pesos One Two Three Four Five Rent income 10.780 10.470 18.000 13.650 Expenses 8. Four END .000 13. High Class Townhouse.530) (5.000. Four and Five c. Three.000 26.350) Included in the expenses is P12. Two.100 23.000 Profit 2.000 24.000 ( 900) (2.000 of corporate overhead allocated to the townhouse based on rental income. Four and Five d.000 12. The complex that the company should consider selling is (are) a. Four and Five b.13 70. Ortigas and Greenhills area.
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