PAR oF umuurroes: CPA MEVINW ne MANAGEMENT AOWIBORY BERVICES ‘eet 13.2010 Pia Preorder ‘ertay 130 pmo 430 sot Imstrictioms, Cheers the WEST answer fr each ct the folonng Reems. Mark only one answer for each hha cn the Specs! Ataner Sheet provided, Sky no erasne plowed, Use Pend No only 1, Which one of the follovang categories of costs Is moat Hkely not considered @ component ‘of fixed manutackwing overhead? a, Rent 6 Supenvvory salaries 1. Property taxes 6. Power 2. Ail costs related to the manufacturing funtion in a company are 9. Prime costs Product costs be Direct cont 4d, Conversion costs 3, The IMA Statement of Ethical Professional Practice includes a competence standard, which requires an IMA member to {2 tepat Information, whether favorable or unfavorable. '. Develop his or her professional profcency on a continual basis. © Discuss ethical conics and possible courges of action with an unbiased counselor. 4, Discuss with subordinates thelr resporsiblites regarding the disclosure of Information abot the fim, LITIMS 4 AND 5 ARE DASED ON THE FOLLOWING: Jrycee Company is preparing Its annual prof plan. AS part of its analysis of the proftabity of individual products the controller estimates the amount of overhead that shouldbe allocated tothe Individual product lines from the information given below: Wall Specialty Mirors Windows Units produced 5 3 Materlal moves per produc line 5 5 Direct labor hours per unit 200 200 Budgeted materials handing costs 0,000 4. Under 3 costing system that assigns overhead on the basis of direct labor hours, the ‘materia handing costs allocated to one urit of wall mirrors would be a. P1000 1 P2,000 b. 500, «4. P5,000 5, Under actsity-based costing, the materials handling costs assigned to one unit of wal mirrors would be ‘a. P00 © P1,500 b, 500 4. P2;500 6. In an activity bosed costing system, what should be used to assign a department's ‘manufacturing overhead costs to products produced in varying tt sizes? 4. A single cause-and-effect relationship >. Multiple cause-and-effect relationships Relative net sales values ofthe products 4. -Aproduct’s abilty to bear cost allocations, 7. nmacroeconomic tems, aggregate demand is the 44, demand for money by the community ina period of full employment.can unccenenr aomsonr semvces ‘Feat Pr teat Caaton APRA '3 2079 eSBaTCH _ at page , total expenditure on capital goods by entrepreneurs during a period of full employment: ‘c. demand that is needed ifthe country’s economy isto operate at optimum level and the level ofiwestment is to be raise. 4. total expenditures on consumer goods and investment, inducing government and foreign expenditures, during a given period 8, Exchange rates are determined by ’, each industial country’s government. . the International Monetary Fund. supply and demand inthe foreign curency market. exporters and importers of manufactured goods. 9. Shorter interest rates are 2, usualy lower than fong-term rates, i. usually higher than long-term rates. lower than long-term rates during pertods of high inflation Only. not signfcanty related to long-term rates, 10, Which ofthe folowing techniques is used to value stock options? a. Black-Scholes method c Weighted average method '. Zero-coupon method Expected earings method 1. The receipt of raw materials used in the manufacture of products and the shipping of finishes goods to customer is under the control of the warehouse suparvisor, whose time 's spert approximately 60% on receiving and 40% on shipping activites. Senarate stafts fer these operations are employed. The ‘abor-rlated costs for the warehousing function are as follows: Warehouse supervisors salary » 49,000 Receiving cleric wages 75,000 Shipping certs! wages 5,000 Employee venesit costs (30% of wage ‘and sassy costs) ;.008 Poe ‘The company employs 2 resyorsbity aceurting sjsteri far performance reporting Purposes. Costs are ciastied as pend tr produ coz. What isthe toa of labor related (costs reporter as proauct costs under the Contval of tho v.aehouse Supervisor? a. P97, 516 P3000 b. 128,700 ©. P2210 12. A management decision may be beneficial for a var: prof center but not forthe entre company. From te overall company vewaint, this cesison seats to ‘a. Sub-iptimizaton © Goal congruence . Centraizaton d. Maxiization LTTEMS 13 AND 14 ARE BASED OW THE FOLLOWING: Jessie Corporation is @ highly automated manufacturing firm. The vien president of finance ihas cecidea that ‘radtiona’ standards sre inappropeiae for periormance measures In an automated e,vironment. Labor is Insignificant in terms of the total cost of production and tends to be Ped, materal quality consered more imporant than minitizing material cost, and customer satisfaction is tie number one pronty. AS & result, delivery performance ‘measures have been chosen to evaluate performance. “The following information is considered typical ott time involved to complete orders,ows Fated an Am 200 oT NCEE ces ame Wait time from order being placed to start of procuction 10.0 éays Wit time from start of production to competion S0aays Inspection time 15 days Process time 30.éays Move time 25 cays 13, What's the manufacturing cyl efitency fortis order? 2. 250% © 37.5% b. 136% 6. 33.3% 14, What isthe delivery cycle time for this order? a 7 days 15 days ' b. 12 days a. 22 days i 1s. 16. 7. 13. Division A of @ company is currently operating at 50% of capacity. It produces a single product and sells all its production to outside customers for P13 per unit. Variable costs bre P? per unit, and fixed costs are PG per unit at the current production level. Division 8 which curreny purchases this product from an outside supplier for P22 per unit, would Tike to purchase the product from Division A. Division A will operate at 80% to meet ‘outside customer’ and Division B's demand. What is the minimum price that Division A ‘should charge Division B for this product? ‘a. P7.00 per unit, & P12.00 per unit i P9.60 per unit . P13.00 per unit “Total quality management (TQM) in a manufacturing environment is best exemplified by: '2. identifying and reworking production defects before sale. b.. designing the products to minimize defects. performing inspections to Isolate defects as early as possible. i. making machine adjustments periodically to reduce defects. ‘A company produced and sold 100,000 units of a component with a variable cost of P20 per unit. Fist-quality components have a selling price of P50. The components Specifications requires Its weight to be 20kgs. with a tolerance of #1 kg. Unfortunately, 1/200 units were reworked at a cost of P12 per unit and sold as factory seconds for PAS: each, Had the company had a quality assurance program in place such that all units produced conformed to specifications, the increase in the company's contribution margin from this component would have been a. P4400 & P21,600 b. P20,400 dd. P39,600 ‘An investment project is expected to yleld P10,000 in annual revenues; wil Incur F2,000 in {ined costs per year, and requires an intial Inventory of p5,000.Given 2 cost of goods Sold ‘of 60% of sales and ignoring taxes, what is the payback period in years? a. 250 5:00 b. 200 4. 1.25 “The following data relate to two capital budgeting projects of equal isks: Fi Period — Project A Project B 0 (10,000) (30,000) 1 4,550 13,650 2 4,150 12,450 3 3,750 11,250‘cPAR AGEMENT ADMORY SERMCES FalPr toa xamnaten APRA 19,2019 SS BATCH rags 42 oe Which of the projects wil be selected using the proftabilty index (PI) approach and the inet present value (NPV) approach? a a 8 b. Bither ‘ onark a 8 Which ofthe folloing is strictly not a use of working capita? ‘Repurchase of common stack Purchase of equipment on account . Purchase of inventory on account 4. Repayment of ong term debt ITEMS 21 TO 28 ARE BASED ON THE FOLLOWING: ‘The Blackpink, Inc. has four product-lines namely ~ La-Lisa, Jenne, Jisoo and Rese. Data ‘on sales and expenses for the immediately preceding year are as follows: (in thousands) Tout__Latia Jeane Se sae FD woo Pa Vesta cos ratoon Comeon aga aio Feds Aerie ae eo Depress sta Sse of oie sea 12000 Mie cam sowoaatoo Toral fined cost 200.000 46000 66.000 Netcpinginene to) _ pong PO PRIGD_ Th. 9m Unt 15039 20m an ‘Atocte 2884 0s pss Managerr ent is concermed about the continued lasses shawn ty soo and Rose and ask You for a recommendation, Zalaies of product ne managers eculé be eliminated I the respective unoroftable preduct line is iscontinued, The equipment used to produce each Product can stl pe use for ether purposes, ‘After careful evaluation, you provided the folowing options for the management to decide: * To viscontinue the unproftable product ne and use its cuirent equipment to produce La-Lsa whch wil result to an increase ints sees by 2016, ‘+ To invest in improving equipment used! in the preduction of the unprofitable product- line to reduce its verabie cost by 50%. The cost of mroverentis P10,000, which will be depreciated on a straight-ne bass for 5 years, The cust of capital fs 896 + To cease the production of the unprofitable product tine out instead purchase its fendre product requirement trom Jennie, which 's currerty operating at excess capacity. Jenm, nowever, wil need to incur ational P5,00 per unit to adjust Its products to the design set by the unprofitable product-nc, The managers agreed at 2 price equal 10 249% of the total relevant costs incured by Jennie. The unused ‘equipment wl tnen be used to praduce 309, which wil result to an increase in Is