Question

1. A Company calculated residual income for 200X to be $22,000. The company’s target rate of return was 12%, the turnover was 2.0. If the operating assets invested was $400,000, what was the Company’s net operating income during 200X?

   		$ 70,000
   		$ 48,000
   		$ 26,000
   		$118,000 2. A retail firm has a sales price of $23 per unit and variable costs of $11.00 per unit. The firm’s margin of safety is 3,000 units (they are selling 3,000 units more than the break-even point in units). Operating income would be: $33,000 would need to know fixed costs to determine operating income at this level of sales $36,000 $69,000 3. The job cost record in a manufacturing company is used to record: only the costs that can be directly traced to the job all product costs for the job only the manufacturing overhead allocated to the job both product and period costs associated with the job 4. Quick Inc. has prepared a planning budget for a volume of 15,000 units. On the planning budget rent is budgeted to be $30,000. The flexible budget prepared for an actual activity level of 20,000 units would have a value for rent of: $30,000 $35,000 $40,000 $15,000 5. Dek Inc. is a manufacturing firm. When direct materials are issued to production, which of the following accounts should be debited? work-in-process inventory accounts payable finished goods inventory raw materials inventory 6. According to the Code of Conduct for management accountants (IMA’s Statement of Ethical Professional Practice), the resolution of an ethical conflict in a firm that has not developed its own processes: should immediately involve external stakeholders like customers and suppliers should never involve lower level or newly hired employees should begin with the employee’s immediate supervisor as long as he or she is not involved does not have to take place as long as your supervisor deems that the problem should be ignored.

Answer 1