6. A wealthy economy that has already reached its steady state might continue to enjoy sustained economic growth if a. It continues to increase its money supply b. There are continuing technological advances c. Its savings rate is high d. It utilizes protectionist trade policies

7. Which policy statement might a Keynesian economist make?

a. The government should stay out of the economy b. The government should focus on aggregate supply, not on aggregate demand c. The government should encourage savings, not spending d. The government should use spending to promote full employment

8. A country can achieve a more rapid rate of economic growth if its citizens are prepared to a. Pay more taxes b. Spend more on goods and services c. Sacrifice some present consumption d. Redistribute income to the poor

9. According to the basic Solow model, poorer developing countries

a. Will never be as wealthy as developed countries b. Will always grow more slowly than developed countries c. Will eventually be as wealthy as developed countries d. Will never converge to a steady state

10. If the Fed sets the interest rate higher than the market level, we would expect to see

a. An increase in the GDP b. An increase in the unemployment rate c. An increase in the rate of inflation d. An increase in the price level

The Bartlesville plant of Harmon Company produces an industrial chemical. At the beginning of the year, the Bartlesville plant had the following standard cost sheet:
Direct materials
(10 kg @ R1.60 per kg)
R16.00

Direct labour
(0.75 hour @ R18 per hour)
R13.50

Variable overhead
(0.75 hour @ R3 per hour)
R2.25

Fixed overhead
(0.75 hour @ R4 per hour)
R3.00

Standard cost per unit

R34.75

The Bartlesville plant calculates its overhead rates using practical volume, which is 72 000 units. The actual results for the year are as follows:
Units produced
70 000

Direct materials purchased
744 000 kg @ R1.50 per kg

Direct materials used
736 000 kg

Direct labour
56 000 hours @ R17.90 per hour

Variable overhead
R175 400

Fixed overhead
R214 000

Required:

a. Calculate the following:
i. Direct materials price and usage variances
ii. Direct labour rate and efficiency variances
iii. Variable overhead spending and efficiency variances
iv. Fixed overhead spending and volume variances

b. Prepare journal entries for the following:
i. The purchase of direct materials
ii. The issuance of direct materials to production
iii. The addition of direct labour to production
iv. The addition of overheads to production
v. The incurrence of actual overhead costs
vi. Closing off of variances to Cost of Goods Sold

• If a developing country wanted to increase its level of investment, which of these actions would directly lead to this goal?

A) Strengthen and enforce private property laws.

B) Provide a minimum level of food to all people in the country.

C) Increase taxes to prevent corporations from keeping excess profits.

D) Nationalize all foreign manufacturing facilities in the country.

• In class, we wrote the production function as Y = AF(K,H). This production

function tells us that

A) output depends on institutions A, K, and H and these vary by country

B) output is a function of the technology (A), physical capital stock (K), and local

government (H).

C) output is a function of the technology (A), physical capital stock (K), and human

Capital/Labor (H).

D) None of the answers are correct.

• Why might economist consider banks efficient?

A) Banks profit by paying interest to savers and lending the money out at a higher interest rate

B) Banks coordinate lenders and borrowers in a way that would be wasteful if they did not exist.

C) Banks generally do not undertake in risky transactions unless they have full information.

D) Banks cannot fail

E) A&B

• Private spending on tools, plant, and equipment (ie. capital goods) that are used to produce future output is called

A) consumption.

B) investment.

C) government spending.

D) net exports.

Question 1:-Superior Company provided the following data for the year ended December 31 (all raw materials are used in production as direct materials):

   Selling expenses$214,000Purchases of raw materials$269,000Direct labor ?Administrative expenses$152,000Manufacturing overhead applied to work in process$368,000Actual manufacturing overhead cost$351,000

Inventory balances at the beginning and end of the year were as follows:

Beginning of YearEnd of YearRaw materials$55,000 $31,000 Work in process ? $25,000 Finished goods$30,000  ?

The total manufacturing costs for the year were $675,000; the cost of goods available for sale totaled $720,000; the unadjusted cost of goods sold totaled $669,000; and the net operating income was $38,000. The company's underapplied or overapplied overhead is closed to Cost of Goods Sold.

Make schedules of cost of goods manufactured and cost of goods sold and an income statement. (Hint: Prepare the income statement and schedule of cost of goods sold first followed by the schedule of cost of goods manufactured.)

So need to solve and put entries in these schedules:-

Income Statement

• COGS Schedule
• COGM Schedule

81. A memorandum on the sale of goods that does not indicate the _____ of goods to be sold will not satisfy the UCC's writing requirement.
A. quality
B. quantity
C. delivery
D. cost

82. In determining whether an offeree accepted an offer, the court is looking for the same _____ on the part of the offeree that it found on the part of the offeror.
A. present intent to contract
B. inquiry regarding terms
C. subjective standard
D. silent acceptance

83. Helen worked for ABC Motors for 25 years. The president of ABC said to her: "In consideration of your past service for 25 years, I promise to give you a new car next week." However, he did not give the car. Is this promise legally enforceable?
A. Yes, a contract was formed.
B. Yes, promissory estoppel requires enforcement of the promise.
C. No, legal consideration is absent.
D. No, legal capacity is absent.

84. April and Brian entered into a completely integrated written contract. Before the written contract was completed, April made an oral statement to Brian regarding the terms of the contract. This statement was not contained in the written contract. Under the parol evidence rule, evidence of April's oral statement would be admissible if it were used to:
A. create a completely new agreement.
B. introduce an ambiguous term in the written contract.
C. prove an additional term consistent with the written agreement.
D. change the terms of the written contract.

85. A written agreement was signed by two parties and it was intended to be their entire agreement. The parol evidence rule will prevent the admission of evidence that is offered to:
A. prove the existence of a contemporaneous oral agreement that modifies the contract.
B. prove the existence of a subsequent oral agreement that modifies the contract.
C. explain the meaning of an ambiguity in the written contract.
D. establish that fraud had been committed in the formation of the contract.

86. Which of the following is most true regarding noncompetition clauses in contracts?
A. Such clauses are not used during employment contracts.
B. If they have a legitimate business purpose, such clauses will be enforced.
C. Such clauses are enforced only for protecting the environment and conserving resources.
D. Such clauses help in promoting free trade.

87. What effect does the rule of res ipsa loquitur have in a negligence case?
A. It creates a rebuttable presumption of breach of duty.
B. It creates a non-rebuttable presumption of causation.
C. It results in strict liability of the defendant.
D. It results in strict liability of the plaintiff.

88. Which of the following meets the requirements of consideration?
A. A promise not to engage in a crime or tort
B. A promise without a binding obligation
C. A promise that involves the exchange of a legal value
D. A promise to do a preexisting duty

89. Ward is attempting to introduce oral evidence in an action relating to a written contract between Ward and Weaver. Weaver has pleaded the parol evidence rule. Ward will be prohibited from introducing parol evidence if it relates to:
A. a modification made several days after the contract was executed.
B. a change in the meaning of an unambiguous provision in the contract.
C. fraud in the inducement.
D. an obvious error in drafting.

90. _____ is generally taken to mean the absence of meaningful choice together with terms unreasonably advantageous to one of the parties.
A. Unconscionability
B. Illegality
C. Adhesion
D. Rescission

Forecasting

Illustrate your work to show how the answers were obtained. Round to two decimal places. Feel free to illustrate your answers in tables if this helps you to visualize the mathematical functions taking place.

Based on the following data, develop a forecast for the expected demand for Year 2. Assume the demand for year two will be 130,000 units. This is a seasonal demand forecast. You may illustrate this in tables if you wish, but show your calculation within the table. Round to two decimal places in your calculations

Year 1 --- Past Sales (Units)

Quarter 1 --- 28,000
Quarter 2 --- 36,400
Quarter 3 --- 28,600
Quarter 4 --- 27,850

Given the following data, use a three-quarter moving average to forecast the demand for the third quarter of this year.

------------ Jan --- Feb --- Mar --- Apr --- May --- Jun --- Jul --- Aug --- Sep --- Oct --- Nov --- Dec
Last Year 260 --- 280 --- 275 --- 320 --- 315 --- 345 --- 275 --- 290 --- 280 --- 345 --- 368 --- 388
This year 270 --- 275 --- 265 --- 370 --- 325 --- 345