Scribd
Upload
219 views14 pages

Mas Final Cpar May2017

pre board

Uploaded by

Neka Mariel Zarceno StaAna
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOC, PDF or read online on Scribd
219 views14 pages

Mas Final Cpar May2017

pre board

Uploaded by

Neka Mariel Zarceno StaAna
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOC, PDF or read online on Scribd
You are on page 1/ 14
Whe «des CPAR (CPA REVIEW SCHOOL OF THE PHILIPPINES: Manila MANAGEMENT ADVIBORY SERVICES APRIL 23,2017 Fai Pre-board Examination oni ‘Suny. 12:20 pm to 30 pen Instructions. Choose the BEST answer for each of the following items. Mark only one answer for ‘tthe Special Anawer Sheet provided. Strictly ro erasure slowed. Use Pencl Ne. 2 only. \ When a decision is made in an organization, it is selected from a group of alternative ‘courses of action. The lass associated with choosing the alternative that does hot maximize ‘he benefit is tie Cc 2. net realizable value € opportunity cost D. expected value 4. incremental cost a ICN company s preparing its cash budget for the coming month. All sales are made on account. Given the Begenig Suge \ Cash 50,000 ¥¥d| Accounts receivable 180,000 Sales +800,000 Ty Cash disbursements: 780,000 Depreciation 25,000 Ending accounts receivable balance 210,000 ‘What is the expected cash balance of the company at the end of the coming month? a. P15,000, . P45,000 b. 40,000, 6 77000000 2A company uses flexible budgeting for cust cnntrol. It produced 10,800 Lnits of product during March, incurring an indirect materials cost of P13,000. Its master btidget Tor the year reflected-an indirect materials cost of P180,000 at juction volume of 144,000 units. A 0 flexible budget for March production should refiect indirect materials cost of 6 “a, 13,975 © P13,000 _ Y b. P13,500_, ¢. P11,700 e953 4COne of the purposes of standard costs isto simplify costing procedures anid expedite cost reports, ). replace budgets and budgeting. serve as a basis for product costing for external reporting purposes. J. eliminate accounting for under of cverappied manufacuring overhead at the end of the period. - ay ree Ineremertatcostis hal code Fe wd ELS eh ng oe tt wo hy the profit foregone by selecting one choice instead of another. < anes $40,000, i tt Quality controt No, of batches ¢ Ha 4, Costs, cales, and praducton data far one ofthe organization's products forthe coming Year are as follows: Pres mtr cost pe unl rect matertal Pret fabor east per writ (0.50 OLM © PAS/DLM) Total Fea Preto Esarenanen Ar 23.2017 $1 AATOH NN Nea ae ‘Sales and production data: ‘Expected sales 20,000 units: Batch size 5,000 units Setup 2 per batch Total parts per finished unit 5 parts « 1 Machine hours required 80 MH per batch a Ch (Ci, te egaiation uses ne feat stom, te cost par Un fr ths oro for te ‘coming year wall be - a. 5.29 P6L b. P55 6 P6O5 (12. the organization empigys an activity-besed costing system, the cost per unit for the —/ product described for the coming year will be 7 a 76.00 ‘of Pozi d. P6.30 ‘pricing of products, marketing strategy, and use of productive facility. A calculation a CVP analysts |s the breakeven point. Once the breakeven point has been reached, operating income will increase by the by '@. gross margin per unit for each additional unit sold. b ° ean a analysis (5 key factor in’ many. decisions, including choice of product (used contribution margin per unit for each additional unit sold. variable costs per urit for each additional unit soi. Y sales price per unit for each additional unt sold. * (24 ie major abjecves of any budget syst ae 19 \ 8. define responsibilty centers, provide a framework for performance evaluation, and promote communication and coordination among organization segments. See ery ‘center, fectate Ui fing of Deme for mised budget . Dredictions, and ensure goal congruence between superiors and subordinates. ( foster the planning of operations, provide 2 framework for performance evaluation, ‘and promote communication and coordination among organization segments, ~ 4. foster the planning of operations, feciitate the fixing of blame for missed budaet predictions, and ensure caal congruence between superiors and subordinates. \ 15. Gorversion cost pricing 32. plsees minimal emphasis on the cost of materials used in manufacturing @ product. >= % b. could be used when the customer furishes the materials used in manufacturing & product. places heavy emphasis on indirect costs and disregards consideration of direct costs. d. places heavy emphasis on direct costs and disregard consideration of indirect costs, 16. The Jet Company manufactures components for use In producing one of its finished When 12,000 units are produced, the full cost per unit is P35, computed as. } \ fellows: 2 Direct materials PS” Direct lator ws ak Variable overhead 10 - . 2. i Fixed overhead Soe ee ‘: 4 s ‘The Bennyvic Company bas offered to sell 12,000 components to Jet Company for P37. ‘each. If Jet accepts the offer, some of the fades turrentiy being used to manufacture the components ca be rented as warehouse space fot\P40,000" However, F3 of the fixed overtead currently applied to each component would Rave to be covered by Jet's other What is the clfferential cost to the Jet Company of purchasing the com from the Bennivic Company? ak CPAR MANAGEMENT ADVISORY SERVICES: Fina Pre board Exmiation APPL 23.2017 81" BATCH Page 4of 18 pages - (8,000 . P24,000 7 b, P20,000/ 4. P44,000 17. WWhen applying the cost-benefit approach to a decision, the primary criterion is how well _/oacurprent goals ilo tevel n rdatonte Geet Gaeta duce ol epeced @ variable costs for the courses of action but not expected fixed costs because only the ‘expected variable costs are relevant. b. incremental out-of-pocket costs as well as all expected continuing costs that are ‘common to ail alternative courses of action. sis ol puaitatve / ¢. future costs that differ ar the alternative courses of action plys al ail factors that cannat be measures In numerical. Y[ Rekeuset C 4, historical and future costs relative to the courses of action induding all qualitative factors that cannot be measured in numerical terms. 80,000. What is the product's fixed cost? a P16,000 80,000 1 , 24,000 d. 96,000 38% business needs 2 computer application that can be either developed internally or Purchased. Sultabie softwere from a vendor costs P29,000. Minor modifications and testing ‘can be conducted by the systems staff as part of their regular workload. 18 Product X hs sales of P200,000, a contribution margin of: 209%, and a margn of safety of eon TF the software 's developed internally, a systems analyst would be assigned full time, and a contractor would assume the analyst's responsibiliies. The hourly rate for the regular analyst is P25. The hourly rate for the contractor is P22. The contractor would occupy an empty office. The offic» has 100 square feet, and occupsncy cost is PAS per square foot. V1 2su (Other related data arr as follows, Computer time 's charged using predetermined rates. The ‘organization has sut'icert excess computer capacity for either software development or modification/testing 0° the purchased softwere. Internal Puuchosed ) Develeoment Software Yu ‘Systems e atyst time In hours: eu Deveiopent 1000 v2 Uy ya “eo Madifce. 98 and testing NA 40 Computer barges sco «* P250 " Adcitional « siware purchases 3,200 a wa Inciderial suppties F500 p20 ue a aati Based solely on the cast igures presented, the cose devesncing the comouter application wall be Ax ‘a. P3,500 less tha. acnuiting the purchased sortware package, +!“ (UN) r .PSO0 less than acquiring the purchased software pashege Cc. P1,550 more tn acquiring the purchased sofware package. 4d. P3,550 more ther acquiring the purchased software package. 20. A dompany needs 3 Probab) iow and contributions margin may very, the conipany prepared the following Ba or Which of the following statements is true? a “The expected value of making ts 70,000. The expected value of buying is P125,000. C. Making the swteh s the best choice...» 1d. Buying the switch Is the best choice. s receipt of raw materals used In the manufacture of preducts and the shipping of ‘Goods to casters is under the como! ofthe warehouse supervisor, Whose Une toont appronmmatay 60% on recehng ard 40% on shipping activites. Separate safls Fs the operations are-empljed- The Tabor related cbst fer the warehousing function ave 2s fobows: 70 Warehouse supervisor's salary PF 40,000 © * Receiving derks' wages 75,00 x Y= Shipping clerks’ wages 55,000 24 Employee benefit costs (307% of - wage and salary costs) 1.000 . Pazi.000 AY. ‘The company employs 2 responsibilty accounting system for performance-reporing - Purposes Cons are rassiied 8s perod er product costs. What isthe teal of labor related costs reported 3s costs under the control of the warehouse | a. P97,500 c, P130,000 * fH ops P128,700 . P221,000 s 225A continuous (roling) budget (27 a. presents planned activites for a periad but does not present 2 frm commitment. the plan for only one level of activity, and does not adjust to changes in the of actwaty ‘the plan fer a range of activity so that the plan can be adjusted for changes ZT . Jaf 4. drops the current month or quarter and adds a future month or quarter as the current —imonith or quarter is completed. | 23, Mammimers Corporation is a highly automated manufacturing firm. The vice president Of \ finance has decided that traditional standerds are Inappropriate for performance measures: \/ in an automated environinent. Labor is insignificent in terms of the total cost of production ond tends to be fxed Material quality 's considered more important than minimizing material cost, and customer satifaction is tke nunber one priority. AS 2 result, delivery performance measures have been chosen to evaluate performance. “The following information Is considered typical of the time Involved to complete orders. 7 Waietime rom order being placed to start of production 100-days. ~~ Wait time fromm start of production to comptetion 5.0 days a & uu Inspection time 1.5 days Process time 3.0 days Move ume 15 days CPAR MANAGEMENT ADVISORY SERVICES SE net nnn soe a mt 8 TL an ie Is the delivery cycle time and manufacturing cycle efficiency for this order? a. 12 days and 25% Va) b. 22 days and 25% ~ d. 17 days and 17.6% 24, During Year 1, Brownout Corporation the i ee experienced folewing power outages: Outages per Month aj : ee 5 * 3 x 2 K 4 1 3 - a ¥ore Rm eft 1 Each power outage results in out-of-pocket costs of P400. For P500 per month, Brownout can lease an auxiliary generator to provide power during outages. Assume that the power ‘outages in Year 1 are repeated in Year 2. If Brownout leases an atollary generator In Year In order to increase production capacity, Macey Company is considering replacing an existing production machine with @ new technology improved machine effective January 1. ‘The following information is being considered by the company: ‘+The new machine would be purchased for P160,000 in cash. Shipping, Installation, and testing would cost an additional P30,000. «The new machine Is expected to increase annual sales by 20,000 units at a sales price of p40 per unit. Incremental operating costs include P30 per unit in variable costs and total fixed costs of PA0,000 per year. | 70) JD = Td * = The investment in the new machine will require an Immediate increase in working _ ‘capital of P35,000. This cash outflow will be recovered after five years. yal «Macey uses straightine depredation for financial repagea, and tax reporting purposes. The new machine hgs an estimated useful ie '5 years and zero salvage value. 1490 /e #7 L = Macey is subject to 240% income tax rate. present value methxi to analyze Investments and will employ the eee ee nen co Macey uses the net following factors and rates: Present Value Present Value of an Ordinary. oa Period of Pl at 10% ‘Annulty of PL at < 1 0.909 Yes 9.909 (are mm 2 0.826 Lae | (Ot Se 3 0.751 2.487 +4 4 0.683 3.170 5 0.621 3791 25. Macey's net cash outflow in a capital budgeting decision is Yo a. P-90,000 c. 204,525 \ ) b, P195,000 d. P225,000 > sg dgcount ex al deprecation tax srs faves 3s K (d . a. P13,817 c a 75> st Woy 94 > b. P16,762 4. P22,800 kc 2 ~ we can Fleer Ears AP 28.217 4 WATE seven iorermeese (27. The overall discount ted cash flow I of | v me Impact. ce cass) cc P(13,26 yas. ¢ mpaer? Calas) 38C-The acquisition ofthe new production machine by Macey will contribute a lscounted net of tax contribution margin of 2 a, P242,624 c. P363,936 QoX 4X 7A b, P303,200 4. PA54,920, 2 _/ — 29¢% segment of an organization is referred to as 2 secice center if It has ‘a. responsibility for developing markets and selling the output of the organization. . responsibility for combining (tee mau, ect bor, ad other factors of production into a final output. | “Pra clo Ching Cater VD ‘¢ authority to make decisions. affecting the major determinagAs of profit including the / Dower to chooses market and sources of supply.“ ey 4. authority to provide specialized support to other units within the organization. x: [3 sconce with te cen gro med the es eleven eins era cost of equity capital for use in determining a firm's weighted average cost of capital are: ’a._ current diicends per share, expected growth rate in dividends per share, and current book value per share of common stock. b. current earings per share, expected growth rate In dividends per share, and current market price per share of commen stock. ‘c current eamings per share, expected growth rate in earnings per share, and current e 3 3 book valve per share of common stock. ‘current dividends per share, expected growth rate ln cvidends per share, and curent market price per share of common stack, 3 itenrycar Corporation, whicn has na current debt, has a beta of 0.95 far fs current stock. qi ‘Management Is considering a change in the capital structure to 30% debt and 70% equity. wie, QO: sot) This change would increase the beta an the snc 1.05 and the afte tx cost Of 6% Wi gan MS be 755. The expected tum on equty Is 26%, end he risk Fee mts 8 RE a ate Be Urns tar rode = ae - “as ‘Should Henrycar’s management proceed with the capital structure change?” wr fF Bz a. No, because the cost of equity capital will increas2. . ov nS 4-09) bl Yes because the cas of equity capta il icrease 107Au ‘e Yes, because the weighted average cost of capital will decrease. ® a No, because the weighted average cost of capital wl increase. ¢h 432. Abrigose, Inc. Is planning ta Invest P20,000 in a 10-year project. Abrigose estimates that ‘the annual Inflon, net of income taxes, from this project will be P20,000. The. comy rate of return on investments of this type is 1096. Information on ; factors is as follows: Phy At 10% At 12% Present value of Pl for 10 periods 0.386 on «6G 4 Present value of an annuity of Pt for 10 periods 6.145 ie 5650, ( ‘Abrigase' intemal rate of return on this Investment is ‘ ess than 10% but more then O84, —c. ‘less than 12% than 1096 YO b. 10% dg. 12% = (43 bymanufacuring company is planning to implement @ just-in-time (IIT) purchase poley \ ‘with its primary suppliers to accept long-term purchase orders which et in ore frequent deliveries of smaller quantities of raw materials! ifthe JIT purchase policy | successful in reducing the total Inventory coats of the manufacturing compam, ft witch ofthe folowing combinatons of cost changes would be ost tkaly to occu? eo \ A t oy s , 4 PAR MANAGEMENT ADVISORY SERVICES nal Pr-board Examination — APRIL 23, 2017 8)" BATCH acts) ‘@. Purchasing costs will increase and stockout costs will decrease. 'b, Purchasing costs will Increase and quality costs will decrease. © Quality costs wil increase and ordering costs will decrease," d, Stockout costs will Increase and camying costs will decrease, 34(An Investment project 's expected to yield P10,000 In annual revenues, will incur P2,000 in ffxed costs per year, and required an inal Investment of P5,000: Given a cost af goods of 60% of sales and Ignoring taxes, what Is the payback period nears? is] | a, P2.50 2.00, ” - “be 5.00 d. 2.50 1 es a tem cet 2 year. The usual lead time for the part Is sx days; occaslonally, however, the lead time has gone as high as 8 days. The company now desires to adjust its safety stock policy. The Increase In safety stock size and the key eect on stochput, costs and carvings p WOU BE aan ‘a, 560 units, decrease, increase. 1,680 units, decrease, Increase, | —————— . 560 uns, decrease, decrease, 4, 2,240 units, Increase, decrease. _36-K company ts evaluating the following information in an effort to determine which of two —-™~ products, A or B, it should manufacture during the coming year. Disregard income tax PRODUCT PRODUCT Expected pected Sates ‘Propaoiity Sates Probably (FS L 7,000 0.60 “ye 9,000 0.75 f 8,000 040 41 10000 025 ae ad ~~ eprr( | . 1) peat Selling price P20 _ PIS Variable cast per unit Be Bee ‘Annual fixed manufacturing costs (ail cash)! * 50,000 40;000 ‘Annual company non-manufacturing expenses (all cash) 20,000 20,000 4 > Ifthe company uses the expected value approzch, which product should It manufacture? ‘a. Product B because its total profit wil be P3,000 higher than that of Produet A. Product B because the expected valve of is sales in unlts's 1,850 higher than that of Product A. ca Product A because the expected value of Its contribution margin is higher than that of Product A. d. Product B because Its expected value is higher than that of Product A. - | a7.phet, Inc. manufactures two products, X and Y. Each product must be processed in each of { Tuments: machining, assembling, and finishing. the hours needed to produce one three depmmduct per department and the maximum possible hours per department are Provided below. Procucon Hous (Maximum Capacty au ata $f ay Machining 3 ‘i Assembling 2 3 bet Finishing a ee ore Other restrictions follow: x2 50 ee a Ror “ft } ‘ wt Kncle gee, oer & dot \ ve Sb ine a i Pal Pre-boars Examination — APRIL 23.2017 8{* BATCH ee eet atatee The objective function Is to maximize profts if val ee in vs profit equals 4X + 2Y. Given the objective "Son Se oman a the most profitable wee k y and 100- Qi ~ ¥ } 170and80 b. 165and90 ~ Hh Ava na'o 6 au XB The folowing infomation apples to projet ze) ate ‘Time ters) tema Predecessor =p uy? ‘ ey Mv SEs! ‘The earliest completion time for the project is: a. days © 15 days t } b. 14 days 4, 20 days > aad Phos | Company recently completed and sold an order of 50 units that had the foll ‘Direct materials 7 > 1,500 fvo7as™ Ie Direct labor (1,000 hours @ P8.50) 8500 - © Variable overhead (1,000 hours @ P4.00)* 4,000 Ww Fixed overhead"* 1.490 ‘Teka bis.490 hy ™ Applied on the basis of direct labor hours mone> onawa fem = “Applied atthe rate of 10 percent of variable cost ‘The company has now been requested to prepare a bid far 150 units of the same product. If A 80 percent learning curve is applicable, Moss Company's total cost on this order would «1 \) as <. P37,950 Wun y ys < (7,240 31,790 6. P37,500 24d ‘company has budgeted unit sales for the ling quarter, Lm, (ey. January i.at0 7 x wr eve" ter ae a tL Febr Af v March 16,500 Wve wes ‘The ending finished goods Inventory for each month equals 50% of the next_month's.. ” budgeted sales. Additionally, 3 kilos of raw materials are required for each finished unit produced. The ending raw materials inventory for each month equals (00% of the next ‘month's production regulrements. —~ W tha cow vara colt 74 per kilo and must be paid for in the month purchased, the materials purchases (In peso) for January ave ars oe} c. P198,0007 PF) b. 207,000 4. P180,000 41, The economic order quantity is the size of the order that minimizes total Inventory Costs, ( * Pag raring and carrying costs. If the aval demand decreases by 26%, th optimal = ‘order size will yt 2 ‘ . decrease : neroase by 6%. ; /) ; Sore cima LY j Se Sah Mam am mrs cee? c. P7750 | 4. P8,000 43. te PSSore ust alain iver of wide variety of pars to stays dverea ‘absolescence. Which ae 98, Oma eer Syege base. As a result, the store's Inventary has a high risk of the flere feotures would be most daurabia bo bee stews coedtons aut a mana review ofthe au par sors)” @. A high quick retio” b. AIS ott rao. © Ahigh number of oS sles cutesy in enang we rebabatle dA low Inventory turnover ro a firm Is offered credit terms of 2/10, net 30 on its purchases, sound cash management tices Would mean that the firm would pay the account on which of the Following days? a. Day 2and 30 Day 10 b. Day 2 and 10 Day 305, strategy objective in the balanced scorecard framework Is a salient of wi Ue racy ma ahem what a Sa 1h hay action programe required to achieve raters objectees. tla le €. lagrams of the cause snd effect relationships between strategic a Salen ptacence te peace RS eee et Ae eee a Decrease ‘ b. Increase ¥ nome + bee Decrease Increase’ ty cat é. Decrease Decrease Put ‘Aviation recently reported the following information: x - ’ non eu : Interest expense: ramen wi "Th companys arrose tnx as $0 Pre mae bh ee er OOF og c UBF Ew, & pe ag “a 144: wr~ @ 2067% «Gm b. 16.67% se function expression that mathematically Inks costs, thir Behn, and their aoa: To at Kincton fr a relevant ange of 100,00 rts to 200,000. uns “etal costs = P500,000-+ Fx wheres he number of uns PAR MANAGEMENT ADVISORY SERVICES ‘Pina Pre-boars Cxaination APRIL 23,2017 01% BATCH. Page 11 f 18 908 \Aiihich of the following statements Is incorrect? a, 500,000 Is Uhe total fixed cost b. PBs the varlable cost per unit c. Total cost is P2, 100,000 If production Is 200,000 units | Vie Total cost Is P500,000 If production fs zero (0). é> | the following to answer questions 49 to 53: Financlal statements of Belleool Corporation are reproduced below, The market price of Bellepol's common stock was P20 per share on November 30, 2017. Bellepol Corporation Statement of Financial Position ‘As of Novernber 30 (in thousands) 2uz. Cash P 3,000 ’ Short-term niarketable securities 1,000 ne | Accounts recelvable (net) 14,000 1 Merchandise inventory 24,000. ‘Total current assets 42,000 i / Property, plant, and equipment (net) 68,000. | | Long-term investments 10,000 | Total assets 120.000 Accounts payable P 5,000 | ‘Wages payable 1.900 Total current liabilities 6,000 | Bonds payable, 10% 20,000. ' Total labilties 226.000 i Common stock, no par, 10,000,000 shares P. 25,000 ° Retained earnings 69,000 | ‘Total stockholders’ equity 94,000 | Total liabilities and stockholders’ equity ‘B4.20.000 } Bellepol Corporation ‘Statement of Income For the Year Ended November 30, 2017 i {in thousands) f cms | Sales (all on credit) ‘p200,000 » \ Cost of goods sola zoom “2 | i \ Gross margin P 80,000 | ” Operating expenses 38,000 pe ce a Operating income P 42,000 H i Interest expense 2.000 & Income before income taxes P 40,000 | w | Income tax 415.000 - Net income 25.000 | 49, Bellepo! Conran St, (Quick) ratio as of November 30, 2017, Is clasest to: CPAR Fal Precoaed Ewarsinatee = APL 23,2017 aY* MATCH a 28 a? hay ¢ a4 Is closest tor a a 18.2 ~ c 96 . b 1429 8. 16.0 y¥ SL--teepol Corporation’ merchandise Inveftory turnover for the ended November 30, 2017, 8 doses. } e a 10 mene eg 5 a4 \ s2-alaa! ¢ Corporation's times interest eamed for the year ended November 30, 2017, is KO TE ele ee Fe see b 125. a5 eh ad make) (§3.)Bellepol Corporation's retun on stockholders’ equity for the year ended November 30, 2017, is dosest tos ‘> @, 12.50% e. 24.00% a b, 22.73% ~ dg. 29.59% Sa. When the it rate Isextremely high a. the supi ney will be relatively small. b. there is na cost tp holding money because Its purchasing power remains constant. the opportunity cost of holding maney is high. 7 d._ the oppoctunity cost of holding money Is low. 5; Whi of the flowin sateen comet? accountants have a responsiilty to maintain an appropriate level of corrpetence by engaing develonment of thei knowledge nd skis. b. Management accountants have a responsibility to disclose confidential information ‘acquired In the course of their wark. “ ¢. Management accountants may engage in any activity that would prejudice thelr ability to carry out their duties ethically, 4 Management accountants have responsi to refrain from sisctasing ail relevant Information that could reasonably be expected to influence an intended user's understanding of the reports, comments, and recommendations presented, 56. A.mahufacturing firm wants to cbtain a chart term loan and has approached several lending tamuore. [All of the potential lenders ae offering the same nominal interest rate, but the ‘terms of the loans vary. Which of the following combinations of loan terms will be most m attractive for the borenwring firm? YY a, Simple interest, 0° compeneating dwarice. YO b. Discount Interes!, no compensating hatarice. c. Simple interest. 20% ccmpensating belence required, id. Discount Interest, 20% compensating aalance required. 57. For the month of Ant Nast Cmpary’s ree coisosen the fotowing data relating tw direct labor 4 Ach al direct labor cost PL0,000 | Rat varence 1,000 favorable Eficency vertance < 4:50 unfavorable S* ‘Standare direct laoor cost oPAR (emt Dornee Germans Armin Bh 2017 wrt mA Page 13 of 18 omen £ For the month ot aed a i i eae 2am res ne fers De emma goer . 4.50 s Pars @. ps0 \ aon a. & 58. Tom and Jerry each operate waterrefiling stations, Tom's station Is called Auto Fil and bs He has an expensive machine that sucks water from the se, purifies the and bottied purified water comes out, His costs are P5,000 per mont” plus P2 per Atha rer of boils proud the cot per Date be th are for bu? *y _ -& mo00 “00 (_ $9'The canter of ray! Company prepared the Fotowang Income suteriett Le January February Cok 4 oe les 420,000 (450,000 a 2 bw é ‘\ Gross 194,000 215,000 . \ ‘Selling and adininiswrative expenses 105,000 © 408.000 a Income before taxes Es.000 puoz.009 k-even? ot — a, P271,667 «, Pa07,500 a. f ™ b, P228,260 4. cannot be detecrrined tram given Information . De tg teres 60, The ballovt payback method be Sra ', Incorporates the rime valve of money. . eb as TE > equals the recovery period from normal operations. — i eliminates the «posal value from the payback caicdlation. di. menaures the ‘isk If a project ts terminated. 64 tion Aa cg. caret pei a Nn cae Fat ‘and sails a! ins prod.» thy. to outside customers 4dr #13 per unit. Variable costs are F7 per Unit, and fixed costs #6 PS par uni a the current proguchon level. “ Divison 8, which curvantly purchases this produc: from an outside supplier Yor P12 Ber unit would like tn purchuon the product ‘Tom Division &. Division A wll operane at 80% cape — to meet outside cuseomwes and Division B's demand, What Is the natural targarnng transfer price range for the twee diiions? a, Between Piz and Pi) t. Betwaen P? and P12 b. Any amount mov than P7 vas fore, eo 2 Lacie is P2 FARE! eperter a7 Its boo’ Tre x SN RA i ctl EDR. unit rie rea ae Rag “nk. aue B60 S EE acer noma = &, fora Special order, their this al reporting to managers, for asepie gfanning ane: carta icy couse 9) Thtemal reporting to managers, for «= ef9MEther numbers decsions ad s._rmsng re: las and policies oR Snayan stocinaice) es, gon faslemest= pA men. vo iin dO iaroe ators is tal: 3. Both internal aro car * pars fey Interest fi. Si ET me GaeTTRO E PLATBMBE, ia. Fimandal accounts9 1 mainly concimed with THE “Hea BSE OF rie-onee! ‘Castodial and stwarcship esprtces of ReseuThte:

You might also like