Act 5060 Midterm Q&a

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ACT 5060 Midterm Exam Name:_____________________________________________________________ 1. Which of the following is not an example of a product cost at a gym? A. Salary paid to instructors. B. Corporate office rent. C. Supplies D. Utility cost in the gymnasium. 2. Gross margin equals: A. Revenues less product costs. B. Revenues less period costs. C. Revenues less selling and administrative expenses. D. Revenues less depreciation expense. 3. Metal used to make components is an example of: A. Direct Labor B. Variable Manufacturing Overhead C. Direct Materials D. Fixed Manufacturing Overhead 4. Which of the following is not an example of a direct material? A. Steel. B. Packaging Materials. C. Leather. D. Canvas. 5. Which account would not be shown under inventory in a manufacturing firm's balance sheet? A. Work-in-Process. B. Merchandising Inventory. C. Finished Goods. D. Held on Consignment. 6. Aspen Company has sales of $2,000,000, cost of goods sold of $200,000, and selling and administrative costs of $500,000. Aspen Company's gross margin is: A. $1,800,000. B. $1,500,000. C. $1,300,000. D. $1,700,000. 7. Suppose Max's Shuttle Service wants to earn a profit before taxes of $375,000 in the coming year. Max's selling price is $40, its variable cost per unit is $20, and its fixed costs are $150,000. How many tickets must the company sell? a. 26,520 b. 26,250 c. 18,750 d. 11,250 8 A firm performs CVP analysis for three primary purposes: a. calculating measures that help assess operating risk b. evaluating the profit impact of short-term decision alternatives c. profit planning d. All of the Above 9. Which of the following is most likely a primary user of managerial accounting? a. Tax Authorities. b. Employees. c. Creditors.

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