ST.

VINCENT COLLEGE
 Leganes  Pototan  Ivisan

MS REVIEW FINALS QUIZ#2

GENERAL INSTRUCTION: Write only the letter of your choice on the answer sheet provided below. Answers should be in CAPITAL
LETTERS. Erasures are not allowed.

TEST I. Choose the letter of your best answer. Round off only on 5. Find the maximum lead time in working days.
the final answer. (Those not following instructions, your answer
will not be considered) a 52.50 c. 45.50
.
ITEMS 1 – 4 ARE BASED ON THE FOLLOWING PROBLEM b 50 d. None of the choices
.
Basilio Corporation has the following data:
6. Compute for the re-order point for Material X.
Selling price ₱50
Variable cost per unit ₱30 a 3,500 c. 4,100
Annual unit credit sales 15,000 .
Collection period 20 days b 3,600 d. None of the choices
Rate of return 25% .

Basilio Corporation is considering easing its credit standards. If it

does, sales will increase by 15%; collection period will increase to ITEMS 7 – 10 ARE BASED ON THE FOLLOWING PROBLEM
30 days; bad debts losses are anticipated to be 5% of the
incremental sales; and collection costs will increase by ₱25,250. Rye Traders, Inc. needs ₱140,000 to pay a supplier's invoice for
(use 360 days working days) merchandise purchased with terms of 4/10, net 40. Rye Traders
wants to pay on the 10th day of the credit term so it can avail of
Based on the given data, answer the questions that follow. the 4% discount. The funds needed can be raised by obtaining a
short-term loan from a bank which agrees to grant a 3-month loan
1. How much is the increase in the contribution margin? at 10% discounted interest per annum. The bank requires that a
compensating balance of 10% be maintained in the borrower's
a P50,000 c. P30,000 non-interest earning deposit account.
.
b P45,000 d. None of the choices Based on the given data, answer the questions that follow.
.
7. The amount needed by Rye Traders to pay the invoice
2. How much is the increase in bad debts expense because within the discount period is
of the increase in sales?
a P134,400 c. P140,000
a P2,250 c. P5,625 .
. b P144,000 d. None of the choices
b P3,750 d. None of the choices .
.
8. The principal amount of the loan that must be obtained
3. How much is the increase in financing cost for the from the bank to raise the needed fund is
additional variable cost?
a P150,000 c. P153,600
a P4,531.25 c. P4,350.75 .
. b P166,956 d. None of the choices
b P3,020.83 d. None of the choices .
.
9. What is the effective interest rate of the loan?
4. If the opposed relaxation in credit standards is
implemented, how much would be the net benefit (loss) a 10% c. 15%
for Basilio Corporation? .
b 11% d None of the choices
a P9,590 c. (P9,649.25) . .
.
b (P9,593.75) d. None of the choices 10. If Rye Traders fails to pay the discount and pays the
. account on the 40th day of the term, what is the annual
cost of this non-free trade credit?
ITEMS 5 – 6 ARE BASED ON THE FOLLOWING PROBLEM
a 30% c. 20%
The following information pertains to Edgar Corporation’s Material .
X. b 40% d None of the choices
. .
Annual usage 20,000 units
Working days per year 300 days
Normal lead time in working days 30 days
Safety stock 1,500 units

Based on the given data, answer the questions that follow.

- - - END OF FINALS QUIZ NO.2 - - -

ANSWER SHEET
NAME: _________________________________________________ DATE.: _____________________
COURSE/ YEAR/ SECTION: _______________________________ FINALS QUIZ NO. 2
SUBJECT CODE: ________________________________________
1. 6. 11.
2. 7. 12.
3. 8. 13.
4. 9. 14.
5. 10. 15.