Accounting Test Bank

7/23/2019 Accounting Test Bank

http://slidepdf.com/reader/full/accounting-test-bank 1/64

CHAPTER 11ABSORPTION/VARIABLE COSTING AND COST-VOLUME-PROFIT ANALYSIS

MULTIPLE CHOICE

1. Conside !"e #o$$o%in& !"ee 'od()! )os!in& *$!en*!i+es, 'o)ess )os!in& o ode)os!in& *nd s!*nd*d )os!in&. 0"i)" o# !"ese )*n e (sed in )on(n)!ion %i!" *so'!ion)os!in&

*. o ode )os!in& . s!*nd*d )os!in&). 'o)ess )os!in&d. *$$ o# !"e2

ANS0ER, d EASY

3. In * e)en! 'eiod M*+e$ Co. in)(ed 435555 o# #i6ed 2*n(#*)!(in& o+e"e*d *nd

ded()!ed 475555 o# #i6ed 2*n(#*)!(in& o+e"e*d. M*+e$ Co. 2(s! e (sin&

*. *so'!ion )os!in&. . +*i*$e )os!in&.). die)! )os!in&.d. s!*nd*d )os!in&.

ANS0ER, * EASY

7. Ano!"e n*2e #o *so'!ion )os!in& is

*. #($$ )os!in&. . die)! )os!in&.). o ode )os!in&.d. #i6ed )os!in&.

ANS0ER, * EASY

8. I# * #i2 'od()es 2oe (ni!s !"*n i! se$$s *so'!ion )os!in& e$*!i+e !o +*i*$e )os!in&%i$$ es($! in

*. "i&"e in)o2e *nd *sse!s. . "i&"e in)o2e (! $o%e *sse!s.). $o%e in)o2e (! "i&"e *sse!s.d. $o%e in)o2e *nd *sse!s.

ANS0ER, * MEDIUM

1191



1193 C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis

;. Unde *so'!ion )os!in& #i6ed 2*n(#*)!(in& o+e"e*d )o($d e #o(nd in *$$ o# !"e#o$$o%in& except !"e

*. %o<-in-'o)ess *))o(n!. . #inis"ed &oods in+en!o: *))o(n!.). Cos! o# Goods So$d.d. 'eiod )os!s.

ANS0ER, d EASY

=. I# * #i2 (ses *so'!ion )os!in& #i6ed 2*n(#*)!(in& o+e"e*d %i$$ e in)$(ded

*. on$: on !"e *$*n)e s"ee!. . on$: on !"e in)o2e s!*!e2en!.). on o!" !"e *$*n)e s"ee! *nd in)o2e s!*!e2en!.d. on nei!"e !"e *$*n)e s"ee! no in)o2e s!*!e2en!.

ANS0ER, ) EASY

>. Unde *so'!ion )os!in& i# s*$es e2*in )ons!*n! #o2 'eiod 1 !o 'eiod 3 !"e )o2'*n:%i$$ e'o! * $*&e in)o2e in 'eiod 3 %"en

*. 'eiod 3 'od()!ion e6)eeds 'eiod 1 'od()!ion. . 'eiod 1 'od()!ion e6)eeds 'eiod 3 'od()!ion.). +*i*$e 'od()!ion )os!s *e $*&e in 'eiod 3 !"*n 'eiod 1.d. #i6ed 'od()!ion )os!s *e $*&e in 'eiod 3 !"*n 'eiod 1.

ANS0ER, * MEDIUM

?. T"e FASB e@(ies %"i)" o# !"e #o$$o%in& !o e (sed in 'e'**!ion o# e6!en*$ #in*n)i*$s!*!e2en!s

*. +*i*$e )os!in& . s!*nd*d )os!in&). *)!i+i!:-*sed )os!in&d. *so'!ion )os!in&

ANS0ER, d EASY



C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis 1197

. An endin& in+en!o: +*$(*!ion on *n *so'!ion )os!in& *$*n)e s"ee! %o($d

*. so2e!i2es e $ess !"*n !"e endin& in+en!o: +*$(*!ion (nde +*i*$e )os!in&. . *$%*:s e $ess !"*n !"e endin& in+en!o: +*$(*!ion (nde +*i*$e )os!in&.). *$%*:s e !"e s*2e *s !"e endin& in+en!o: +*$(*!ion (nde +*i*$e )os!in&.d. *$%*:s e &e*!e !"*n o e@(*$ !o !"e endin& in+en!o: +*$(*!ion (nde +*i*$e

)os!in&.

ANS0ER, d EASY

15. Aso'!ion )os!in& di##es #o2 +*i*$e )os!in& in *$$ o# !"e #o$$o%in& except

*. !e*!2en! o# #i6ed 2*n(#*)!(in& o+e"e*d. . !e*!2en! o# +*i*$e 'od()!ion )os!s.). *))e'!*i$i!: #o e6!en*$ e'o!in&.d. **n&e2en! o# !"e in)o2e s!*!e2en!.

ANS0ER, EASY

11. 0"i)" o# !"e #o$$o%in& is not *sso)i*!ed %i!" *so'!ion )os!in&

*. #(n)!ion*$ #o2*! . &oss 2*&in). 'eiod )os!sd. )on!i(!ion 2*&in

ANS0ER, d EASY

13. Un*soed #i6ed o+e"e*d )os!s in *n *so'!ion )os!in& s:s!e2 *e

*. #i6ed 2*n(#*)!(in& )os!s no! *$$o)*!ed !o (ni!s 'od()ed. . +*i*$e o+e"e*d )os!s no! *$$o)*!ed !o (ni!s 'od()ed.). e6)ess +*i*$e o+e"e*d )os!s.d. )os!s !"*! )*nno! e )on!o$$ed.

ANS0ER, * EASY




17. Po#i! (nde *so'!ion )os!in& 2*: di##e #o2 'o#i! de!e2ined (nde +*i*$e )os!in&.Ho% is !"is di##een)e )*$)($*!ed

*. C"*n&e in !"e @(*n!i!: o# *$$ (ni!s in in+en!o: !i2es !"e e$e+*n! #i6ed )os!s 'e(ni!.

. C"*n&e in !"e @(*n!i!: o# *$$ (ni!s 'od()ed !i2es !"e e$e+*n! #i6ed )os!s 'e (ni!.). C"*n&e in !"e @(*n!i!: o# *$$ (ni!s in in+en!o: !i2es !"e e$e+*n! +*i*$e )os! 'e

(ni!.d. C"*n&e in !"e @(*n!i!: o# *$$ (ni!s 'od()ed !i2es !"e e$e+*n! +*i*$e )os! 'e

(ni!.

ANS0ER, * EASY

18. 0"*! #*)!o e$*!ed !o 2*n(#*)!(in& )os!s )*(ses !"e di##een)e in ne! e*nin&s)o2'(!ed (sin& *so'!ion )os!in& *nd ne! e*nin&s )o2'(!ed (sin& +*i*$e )os!in&

*. Aso'!ion )os!in& )onsides *$$ )os!s in !"e de!e2in*!ion o# ne! e*nin&s

%"ee*s +*i*$e )os!in& )onsides #i6ed )os!s !o e 'eiod )os!s. . Aso'!ion )os!in& *$$o)*!es #i6ed o+e"e*d )os!s e!%een )os! o# &oods so$d *nd

in+en!oies *nd +*i*$e )os!in& )onsides *$$ #i6ed )os!s !o e 'eiod )os!s.). Aso'!ion )os!in& in+en!oies *$$ die)! )os!s (! +*i*$e )os!in& )onsides

die)! )os!s !o e 'eiod )os!s.d. Aso'!ion )os!in& in+en!oies *$$ #i6ed )os!s #o !"e 'eiod in endin& #inis"ed

&oods in+en!o: (! +*i*$e )os!in& e6'enses *$$ #i6ed )os!s.

ANS0ER, EASY

1;. T"e )os!in& s:s!e2 !"*! )$*ssi#ies )os!s : #(n)!ion*$ &o(' on$: is

*. s!*nd*d )os!in&. . o ode )os!in&.). +*i*$e )os!in&.d. *so'!ion )os!in&.

ANS0ER, d EASY



C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis 119;

1=. A #(n)!ion*$ )$*ssi#i)*!ion o# )os!s %o($d )$*ssi#: de'e)i*!ion on o##i)e e@(i'2en!*s *

*. 'od()! )os!. . &ene*$ *nd *d2inis!*!i+e e6'ense.). se$$in& e6'ense.d. +*i*$e )os!.

ANS0ER, EASY

1>. T"e )os!in& s:s!e2 !"*! )$*ssi#ies )os!s : o!" #(n)!ion*$ &o(' *nd e"*+io is

*. 'o)ess )os!in&. . o ode )os!in&.). +*i*$e )os!in&.d. *so'!ion )os!in&.

ANS0ER, ) EASY

1?. Unde +*i*$e )os!in& %"i)" o# !"e #o$$o%in& *e )os!s !"*! )*n e in+en!oied

*. +*i*$e se$$in& *nd *d2inis!*!i+e e6'ense . +*i*$e 2*n(#*)!(in& o+e"e*d). #i6ed 2*n(#*)!(in& o+e"e*dd. #i6ed se$$in& *nd *d2inis!*!i+e e6'ense

ANS0ER, EASY

1. Conside !"e #o$$o%in& !"ee 'od()! )os!in& *$!en*!i+es, 'o)ess )os!in& o ode)os!in& *nd s!*nd*d )os!in&. 0"i)" o# !"ese )*n e (sed in )on(n)!ion %i!" +*i*$e)os!in&

*. o ode )os!in& . s!*nd*d )os!in&). 'o)ess )os!in&d. *$$ o# !"e2

ANS0ER, d EASY



119= C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis

35. Ano!"e n*2e #o +*i*$e )os!in& is

*. #($$ )os!in&. . die)! )os!in&.). s!*nd*d )os!in&.d. *d(s!*$e )os!in&.

ANS0ER, EASY

31. I# * #i2 (ses +*i*$e )os!in& #i6ed 2*n(#*)!(in& o+e"e*d %i$$ e in)$(ded

*. on$: on !"e *$*n)e s"ee!. . on$: on !"e in)o2e s!*!e2en!.). on o!" !"e *$*n)e s"ee! *nd in)o2e s!*!e2en!.d. on nei!"e !"e *$*n)e s"ee! no in)o2e s!*!e2en!.

ANS0ER, EASY

33. Unde +*i*$e )os!in&

*. *$$ 'od()! )os!s *e +*i*$e. . *$$ 'eiod )os!s *e +*i*$e.). *$$ 'od()! )os!s *e #i6ed.d. 'od()! )os!s *e o!" #i6ed *nd +*i*$e.

ANS0ER, * EASY

37. Ho% %i$$ * #*+o*$e +o$(2e +*i*n)e *##e)! ne! in)o2e (nde e*)" o# !"e #o$$o%in&

2e!"ods

Aso'!ion V*i*$e*. ed()e no e##e)! . ed()e in)e*se). in)e*se no e##e)!d. in)e*se ed()e

ANS0ER, ) EASY



C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis 119>

38. V*i*$e )os!in& )onsides %"i)" o# !"e #o$$o%in& !o e 'od()! )os!s

Fi6ed Fi6ed V*i*$e V*i*$eM#&. Cos!s Se$$in& Ad2. M#&. Cos!s Se$$in& Ad2.

*. :es no :es no . :es no :es :es). no no :es :esd. no no :es no

ANS0ER, d EASY

3;. T"e +*i*$e )os!in& #o2*! is o#!en 2oe (se#($ !o 2*n*&es !"*n !"e *so'!ion )os!in&#o2*! e)*(se

*. )os!s *e )$*ssi#ied : !"ei e"*+io. . )os!s *e *$%*:s $o%e.). i! is e@(ied #o e6!en*$ e'o!in&.

d. i! (s!i#ies "i&"e 'od()! 'i)es.

ANS0ER, * EASY

3=. T"e di##een)e e!%een !"e e'o!ed in)o2e (nde *so'!ion *nd +*i*$e )os!in& is*!!i(!*$e !o !"e di##een)e in !"e

*. in)o2e s!*!e2en! #o2*!s. . !e*!2en! o# #i6ed 2*n(#*)!(in& o+e"e*d.). !e*!2en! o# +*i*$e 2*n(#*)!(in& o+e"e*d.d. !e*!2en! o# +*i*$e se$$in& &ene*$ *nd *d2inis!*!i+e e6'enses.

ANS0ER, EASY

3>. 0"i)" o# !"e #o$$o%in& )os!s %i$$ +*: die)!$: %i!" !"e $e+e$ o# 'od()!ion

*. !o!*$ 2*n(#*)!(in& )os!s . !o!*$ 'eiod )os!s). +*i*$e 'eiod )os!sd. +*i*$e 'od()! )os!s

ANS0ER, d EASY



119? C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis

3?. On !"e +*i*$e )os!in& in)o2e s!*!e2en! !"e di##een)e e!%een !"e )on!i(!ion2*&in *nd in)o2e e#oe in)o2e !*6es is e@(*$ !o

*. !"e !o!*$ +*i*$e )os!s. . !"e Cos! o# Goods So$d.). !o!*$ #i6ed )os!s.d. !"e &oss 2*&in.

ANS0ER, ) EASY

3. Fo #in*n)i*$ e'o!in& !o !"e IRS *nd o!"e e6!en*$ (ses 2*n(#*)!(in& o+e"e*d )os!s*e

*. ded()!ed in !"e 'eiod !"*! !"e: *e in)(ed. . in+en!oied (n!i$ !"e e$*!ed 'od()!s *e so$d.). !e*!ed $i<e 'eiod )os!s.d. in+en!oied (n!i$ !"e e$*!ed 'od()!s "*+e een )o2'$e!ed.

ANS0ER, EASY

75. In !"e *''$i)*!ion o# +*i*$e )os!in& *s * )os!-*$$o)*!ion 'o)ess in 2*n(#*)!(in&

*. +*i*$e die)! )os!s *e !e*!ed *s 'eiod )os!s. . non+*i*$e indie)! 2*n(#*)!(in& )os!s *e !e*!ed *s 'od()! )os!s.). +*i*$e indie)! 2*n(#*)!(in& )os!s *e !e*!ed *s 'od()! )os!s.d. non+*i*$e die)! )os!s *e !e*!ed *s 'od()! )os!s.

ANS0ER, ) EASY

71. A *si) !ene! o# +*i*$e )os!in& is !"*! 'eiod )os!s s"o($d e )(en!$: e6'ensed. 0"*! is!"e *!ion*$e e"ind !"is 'o)ed(e

*. Peiod )os!s *e (n)on!o$$*$e *nd s"o($d no! e )"*&ed !o * s'e)i#i) 'od()!. . Peiod )os!s *e &ene*$$: i22*!ei*$ in *2o(n! *nd !"e )os! o# *ssi&nin& !"e

*2o(n!s !o s'e)i#i) 'od()!s %o($d o(!%ei&" !"e ene#i!s.). A$$o)*!ion o# 'eiod )os!s is *i!*: *! es! *nd )o($d $e*d !o eoneo(s de)ision

: 2*n*&e2en!.d. Be)*(se 'eiod )os!s %i$$ o))( %"e!"e 'od()!ion o))(s i! is i2'o'e !o

*$$o)*!e !"ese )os!s !o 'od()!ion *nd de#e * )(en! )os! o# doin& (siness.

ANS0ER, d MEDIUM




73. 0"i)" o# !"e #o$$o%in& is * !e2 2oe des)i'!i+e o# !"e !:'e o# )os! *))o(n!in& o#!en)*$$ed die)! )os!in&

*. o(!-o#-'o)<e! )os!in& . +*i*$e )os!in&). e$e+*n! )os!in&d. 'i2e )os!in&

ANS0ER, EASY

77. 0"*! )os!s *e !e*!ed *s 'od()! )os!s (nde +*i*$e die)! )os!in&

*. on$: die)! )os!s . on$: +*i*$e 'od()!ion )os!s). *$$ +*i*$e )os!sd. *$$ +*i*$e *nd #i6ed 2*n(#*)!(in& )os!s

ANS0ER, EASY

78. 0"i)" o# !"e #o$$o%in& 2(s! e <no%n *o(! * 'od()!ion 'o)ess in ode !o ins!i!(!e *+*i*$e )os!in& s:s!e2

*. !"e +*i*$e *nd #i6ed )o2'onen!s o# *$$ )os!s e$*!ed !o 'od()!ion . !"e )on!o$$*$e *nd non-)on!o$$*$e )o2'onen!s o# *$$ )os!s e$*!ed !o 'od()!ion). s!*nd*d 'od()!ion *!es *nd !i2es #o *$$ e$e2en!s o# 'od()!iond. )on!i(!ion 2*&in *nd e*<-e+en 'oin! #o *$$ &oods in 'od()!ion

ANS0ER, * EASY

7;. 0": is +*i*$e )os!in& not in *))od*n)e %i!" &ene*$$: *))e'!ed *))o(n!in& 'in)i'$es

*. Fi6ed 2*n(#*)!(in& )os!s *e !e*!ed *s 'eiod )os!s (nde +*i*$e )os!in&. . V*i*$e )os!in& 'o)ed(es *e no! %e$$ <no%n in ind(s!:.). Ne! e*nin&s *e *$%*:s o+es!*!ed %"en (sin& +*i*$e )os!in& 'o)ed(es.d. V*i*$e )os!in& i&noes !"e )on)e'! o# $o%e o# )os! o 2*<e! %"en +*$(in&

in+en!o:.

ANS0ER, * EASY




7=. 0"i)" o# !"e #o$$o%in& is *n *&(2en! *&*ins! !"e (se o# die)! +*i*$e )os!in&

*. Aso'!ion )os!in& o+es!*!es !"e *$*n)e s"ee! +*$(e o# in+en!oies. . V*i*$e #*)!o: o+e"e*d is * 'eiod )os!.). Fi6ed 2*n(#*)!(in& o+e"e*d is di##i)($! !o *$$o)*!e 'o'e$:.d. Fi6ed 2*n(#*)!(in& o+e"e*d is ne)ess*: #o !"e 'od()!ion o# * 'od()!.

ANS0ER, d EASY

7>. 0"i)" o# !"e #o$$o%in& s!*!e2en!s is true #o * #i2 !"*! (ses +*i*$e )os!in&

*. T"e )os! o# * (ni! o# 'od()! )"*n&es e)*(se o# )"*n&es in !"e n(2e o# (ni!s2*n(#*)!(ed.

. Po#i!s #$()!(*!e %i!" s*$es.). An id$e #*)i$i!: +*i*!ion is )*$)($*!ed.d. None o# !"e *o+e.

ANS0ER, EASY

7?. An in)o2e s!*!e2en! is 'e'*ed *s *n in!en*$ e'o!. Unde %"i)" o# !"e #o$$o%in&2e!"ods %o($d !"e !e2 )on!i(!ion 2*&in *''e*

Aso'!ion )os!in& V*i*$e )os!in&*. no no . no :es). :es nod. :es :es

ANS0ER, EASY

7. In *n in)o2e s!*!e2en! 'e'*ed *s *n in!en*$ e'o! (sin& !"e +*i*$e )os!in& 2e!"od#i6ed 2*n(#*)!(in& o+e"e*d %o($d

*. no! e (sed. . e (sed in !"e )o2'(!*!ion o# o'e*!in& in)o2e (! no! in !"e )o2'(!*!ion o# !"e

)on!i(!ion 2*&in.). e (sed in !"e )o2'(!*!ion o# !"e )on!i(!ion 2*&in.d. e !e*!ed !"e s*2e *s +*i*$e 2*n(#*)!(in& o+e"e*d.

ANS0ER, EASY




85. V*i*$e )os!in& "*s *n *d+*n!*&e o+e *so'!ion )os!in& #o %"i)" o# !"e #o$$o%in& '('oses

*. *n*$:sis o# 'o#i!*i$i!: o# 'od()!s !ei!oies *nd o!"e se&2en!s o# * (siness . de!e2inin& !"e CVP e$*!ions"i' *2on& !"e 2*o #*)!os o# se$$in& 'i)e s*$es

2i6 *nd s*$es +o$(2e). 2ini2iin& !"e e##e)!s o# in+en!o: )"*n&es on ne! in)o2ed. *$$ o# !"e *o+e

ANS0ER, d EASY

81. In !"e +*i*$e )os!in& in)o2e s!*!e2en! %"i)" $ine se'**!es !"e +*i*$e *nd #i6ed )os!s

*. se$$in& e6'enses . &ene*$ *nd *d2inis!*!i+e e6'ense). 'od()! )on!i(!ion 2*&ind. !o!*$ )on!i(!ion 2*&in

ANS0ER, d EASY

83. A #i2 'esen!$: "*s !o!*$ s*$es o# 4155555. I# i!s s*$es ise i!s

*. ne! in)o2e *sed on +*i*$e )os!in& %i$$ &o (' 2oe !"*n i!s ne! in)o2e *sed on*so'!ion )os!in&.

. ne! in)o2e *sed on *so'!ion )os!in& %i$$ &o (' 2oe !"*n i!s ne! in)o2e *sedon +*i*$e )os!in&.

). #i6ed )os!s %i$$ *$so ise.d. 'e (ni! +*i*$e )os!s %i$$ ise.

ANS0ER, * MEDIUM

87. CVP *n*$:sis e@(ies )os!s !o e )*!e&oied *s

*. ei!"e #i6ed o +*i*$e. . #i6ed 2i6ed o +*i*$e.). 'od()! o 'eiod.d. s!*nd*d o *)!(*$.

ANS0ER, * EASY




88. 0i!" es'e)! !o #i6ed )os!s CVP *n*$:sis *ss(2es !o!*$ #i6ed )os!s

*. 'e (ni! e2*in )ons!*n! *s +o$(2e )"*n&es. . e2*in )ons!*n! #o2 one 'eiod !o !"e ne6!.). +*: die)!$: %i!" +o$(2e.d. e2*in )ons!*n! *)oss )"*n&es in +o$(2e.

ANS0ER, d EASY

8;. CVP *n*$:sis e$ies on !"e *ss(2'!ions !"*! )os!s *e ei!"e s!i)!$: #i6ed o s!i)!$:+*i*$e. Consis!en! %i!" !"ese *ss(2'!ions *s +o$(2e de)e*ses !o!*$

*. #i6ed )os!s de)e*se. . +*i*$e )os!s e2*in )ons!*n!.). )os!s de)e*se.d. )os!s e2*in )ons!*n!.

ANS0ER, ) EASY

8=. A))odin& !o CVP *n*$:sis * )o2'*n: )o($d never in)( * $oss !"*! e6)eeded i!s !o!*$

*. +*i*$e )os!s. . #i6ed )os!s.). )os!s.d. )on!i(!ion 2*&in.

ANS0ER, ) EASY

8>. CVP *n*$:sis is *sed on )on)e'!s #o2

*. s!*nd*d )os!in&. . +*i*$e )os!in&.). o ode )os!in&.d. 'o)ess )os!in&.

ANS0ER, EASY




8?. Cos!-+o$(2e-'o#i! *n*$:sis is * !e)"ni@(e *+*i$*$e !o 2*n*&e2en! !o (ndes!*nd e!!e!"e in!ee$*!ions"i's o# se+e*$ #*)!os !"*! *##e)! * #i2s 'o#i!. As %i!" 2*n: s()"!e)"ni@(es !"e *))o(n!*n! o+esi2'$i#ies !"e e*$ %o$d : 2*<in& *ss(2'!ions. 0"i)" o#!"e #o$$o%in& is not * 2*o *ss(2'!ion (nde$:in& CVP *n*$:sis

*. A$$ )os!s in)(ed : * #i2 )*n e se'**!ed in!o !"ei #i6ed *nd +*i*$e)o2'onen!s.

. T"e 'od()! se$$in& 'i)e 'e (ni! is )ons!*n! *! *$$ +o$(2e $e+e$s.). O'e*!in& e##i)ien): *nd e2'$o:ee 'od()!i+i!: *e )ons!*n! *! *$$ +o$(2e $e+e$s.d. Fo 2($!i-'od()! si!(*!ions !"e s*$es 2i6 )*n +*: *! *$$ +o$(2e $e+e$s.

ANS0ER, d EASY

8. In CVP *n*$:sis $ine* #(n)!ions *e *ss(2ed #o

*. )on!i(!ion 2*&in 'e (ni!. . #i6ed )os! 'e (ni!.

). !o!*$ )os!s 'e (ni!.d. *$$ o# !"e *o+e.

ANS0ER, * EASY

;5. 0"i)" o# !"e #o$$o%in& #*)!os is in+o$+ed in s!(d:in& )os!-+o$(2e-'o#i! e$*!ions"i's

*. 'od()! 2i6 . +*i*$e )os!s). #i6ed )os!sd. *$$ o# !"e *o+e

ANS0ER, d EASY

;1. Cos!-+o$(2e-'o#i! e$*!ions"i's !"*! *e )(+i$ine* 2*: e *n*$:ed $ine*$: :)onsidein& on$:

*. #i6ed *nd 2i6ed )os!s. . e$e+*n! #i6ed )os!s.). e$e+*n! +*i*$e )os!s.d. * e$e+*n! *n&e o# +o$(2e.

ANS0ER, d EASY




;3. A#!e !"e $e+e$ o# +o$(2e e6)eeds !"e e*<-e+en 'oin!

*. !"e )on!i(!ion 2*&in *!io in)e*ses. . !"e !o!*$ )on!i(!ion 2*&in e6)eeds !"e !o!*$ #i6ed )os!s.). !o!*$ #i6ed )os!s 'e (ni! %i$$ e2*in )ons!*n!.d. !"e !o!*$ )on!i(!ion 2*&in %i$$ !(n #o2 ne&*!i+e !o 'osi!i+e.

ANS0ER, EASY

;7. 0"i)" o# !"e #o$$o%in& %i$$ decrease !"e e*<-e+en 'oin!

De)e*se in In)e*se in die)! In)e*se in#i6ed )os! $*o )os! se$$in& 'i)e

*. :es :es :es . :es no :es). :es no nod. no :es no

ANS0ER, EASY

;8. A! !"e e*<-e+en 'oin! #i6ed )os!s *e *$%*:s

*. $ess !"*n !"e )on!i(!ion 2*&in. . e@(*$ !o !"e )on!i(!ion 2*&in.). 2oe !"*n !"e )on!i(!ion 2*&in.d. 2oe !"*n !"e +*i*$e )os!.

ANS0ER, EASY

;;. T"e 2e!"od o# )os! *))o(n!in& !"*! $ends i!se$# !o e*<-e+en *n*$:sis is

*. +*i*$e. . s!*nd*d.). *so$(!e.d. *so'!ion.

ANS0ER, * EASY




;=. Gi+en !"e #o$$o%in& no!*!ion %"*! is !"e e*<-e+en s*$es $e+e$ in (ni!s

SP se$$in& 'i)e 'e (ni! FC !o!*$ #i6ed )os! VC +*i*$e )os! 'e (ni!

*. SP/FC/VC . FC/VC/SP). VC/SP 9 FCd. FC/SP 9 VC

ANS0ER, d EASY

;>. Conside !"e e@(*!ion J S*$es 9 KCM/S*$es S*$es. 0"*! is J

*. ne! in)o2e . #i6ed )os!s). )on!i(!ion 2*&ind. +*i*$e )os!s

ANS0ER, d MEDIUM

;?. I# * #i2s ne! in)o2e does not )"*n&e *s i!s +o$(2e )"*n&es !"e #i2s

*. 2(s! e in !"e se+i)e ind(s!:. . 2(s! "*+e no #i6ed )os!s.). s*$es 'i)e 2(s! e@(*$ 45.d. s*$es 'i)e 2(s! e@(*$ i!s +*i*$e )os!s.

ANS0ER, d MEDIUM

;. Be*<-e+en *n*$:sis *ss(2es o+e !"e e$e+*n! *n&e !"*!

*. !o!*$ +*i*$e )os!s *e $ine*. . #i6ed )os!s 'e (ni! *e )ons!*n!.). !o!*$ +*i*$e )os!s *e non$ine*.d. !o!*$ e+en(e is non$ine*.

ANS0ER, * EASY




=5. To )o2'(!e !"e e*<-e+en 'oin! in (ni!s %"i)" o# !"e #o$$o%in& #o2($*s is (sed

*. FC/CM 'e (ni! . FC/CM *!io). CM/CM *!iod. FCVC/CM *!io

ANS0ER, * EASY

=1. A #i2s e*<-e+en 'oin! in do$$*s )*n e #o(nd in one )*$)($*!ion (sin& %"i)" o# !"e#o$$o%in& #o2($*s

*. FC/CM 'e (ni! . VC/CM). FC/CM *!iod. VC/CM *!io

ANS0ER, ) EASY

=3. T"e )on!i(!ion 2*&in *!io always in)e*ses %"en !"e

*. +*i*$e )os!s *s * 'e)en!*&e o# ne! s*$es in)e*se. . +*i*$e )os!s *s * 'e)en!*&e o# ne! s*$es de)e*se.). e*<-e+en 'oin! in)e*ses.d. e*<-e+en 'oin! de)e*ses.

ANS0ER, EASY

=7. In * 2($!i'$e-'od()! #i2 !"e 'od()! !"*! "*s !"e "i&"es! )on!i(!ion 2*&in 'e (ni!%i$$

*. &ene*!e 2oe 'o#i! #o e*)" 41 o# s*$es !"*n !"e o!"e 'od()!s. . "*+e !"e "i&"es! )on!i(!ion 2*&in *!io.). &ene*!e !"e 2os! 'o#i! #o e*)" (ni! so$d.d. "*+e !"e $o%es! +*i*$e )os!s 'e (ni!.

ANS0ER, ) EASY




=8. #o)(ses on$: on #*)!os !"*! )"*n&e #o2 one )o(se o# *)!ion !o *no!"e.

*. In)e2en!*$ *n*$:sis . M*&in o# s*#e!:). O'e*!in& $e+e*&ed. A e*<-e+en )"*!

ANS0ER, * EASY

=;. T"e 2*&in o# s*#e!: %o($d e ne&*!i+e i# * )o2'*n:s

*. %*s 'esen!$: o'e*!in& *! * +o$(2e !"*! is e$o% !"e e*<-e+en 'oin!. . 'esen! #i6ed )os!s %ee $ess !"*n i!s )on!i(!ion 2*&in.). +*i*$e )os!s e6)eeded i!s #i6ed )os!s.d. de&ee o# o'e*!in& $e+e*&e is &e*!e !"*n 155.

ANS0ER, * EASY

==. T"e 2*&in o# s*#e!: is * <e: )on)e'! o# CVP *n*$:sis. T"e 2*&in o# s*#e!: is !"e

*. )on!i(!ion 2*&in *!e. . di##een)e e!%een (d&e!ed )on!i(!ion 2*&in *nd *)!(*$ )on!i(!ion 2*&in.). di##een)e e!%een (d&e!ed )on!i(!ion 2*&in *nd e*<-e+en )on!i(!ion

2*&in.d. di##een)e e!%een (d&e!ed s*$es *nd e*<-e+en s*$es.

ANS0ER, d EASY

=>. M*n*&e2en! is )onsidein& e'$*)in& *n e6is!in& s*$es )o22ission )o2'ens*!ion '$*n %i!"* #i6ed s*$*: '$*n. I# !"e )"*n&e is *do'!ed !"e )o2'*n:s

*. e*<-e+en 'oin! 2(s! in)e*se. . 2*&in o# s*#e!: 2(s! de)e*se.). o'e*!in& $e+e*&e 2(s! in)e*se.d. 'o#i! 2(s! in)e*se.

ANS0ER, ) MEDIUM




=?. As 'oe)!ed ne! in)o2e in)e*ses !"e

*. de&ee o# o'e*!in& $e+e*&e de)$ines. . 2*&in o# s*#e!: s!*:s )ons!*n!.). e*<-e+en 'oin! &oes do%n.d. )on!i(!ion 2*&in *!io &oes ('.

ANS0ER, * MEDIUM

=. A 2*n*&ei*$ 'e#een)e #o * +e: $o% de&ee o# o'e*!in& $e+e*&e 2i&"! indi)*!e !"*!

*. *n in)e*se in s*$es +o$(2e is e6'e)!ed. . * de)e*se in s*$es +o$(2e is e6'e)!ed.). !"e #i2 is +e: (n'o#i!*$e.d. !"e #i2 "*s +e: "i&" #i6ed )os!s.

ANS0ER, MEDIUM

Use !"e #o$$o%in& in#o2*!ion #o @(es!ions >59>7.

Yo(n& Co'o*!ion "*s !"e #o$$o%in& s!*nd*d )os!s *sso)i*!ed %i!" !"e 2*n(#*)!(e *nd s*$e o#one o# i!s 'od()!s,

Die)! 2*!ei*$ 47.55 'e (ni!Die)! $*o 3.;5 'e (ni!V*i*$e 2*n(#*)!(in& o+e"e*d 1.?5 'e (ni!Fi6ed 2*n(#*)!(in& o+e"e*d 8.55 'e (ni! *sed on *n es!i2*!e

o# ;5555 (ni!s 'e :e*

V*i*$e se$$in& e6'enses .3; 'e (ni!Fi6ed SGA e6'ense 4>;555 'e :e*

D(in& 3551 i!s #is! :e* o# o'e*!ions Yo(n& 2*n(#*)!(ed ;1555 (ni!s *nd so$d 8?555. T"ese$$in& 'i)e 'e (ni! %*s 43;. A$$ )os!s %ee e@(*$ !o s!*nd*d.

>5. Unde *so'!ion )os!in& !"e s!*nd*d 'od()!ion )os! 'e (ni! #o 3551 %*s

*. 411.75. . 4>.75.). 411.;;.d. 417.5;.

ANS0ER, * EASY




>1. Unde +*i*$e )os!in& !"e s!*nd*d 'od()!ion )os! 'e (ni! #o 3551 %*s

*. 411.75. . 4>.75.). 4>.;;.d. 411.;;.

ANS0ER, EASY

>3. B*sed on +*i*$e )os!in& !"e in)o2e e#oe in)o2e !*6es #o !"e :e* %*s

*. 4;>5=55. . 4;=5555.). 4;=3=55.d. 4;8>;55.

ANS0ER, ) MEDIUM

>7. T"e +o$(2e +*i*n)e (nde *so'!ion )os!in& is

*. 4?555 F. . 48555 F.). 48555 U.d. 4?555 U.

ANS0ER, MEDIUM




Use !"e #o$$o%in& in#o2*!ion #o @(es!ions >89>=.

T"e #o$$o%in& in#o2*!ion is *+*i$*$e #o J Co. #o i!s #is! :e* o# o'e*!ions,

S*$es in (ni!s ;555Pod()!ion in (ni!s ?555M*n(#*)!(in& )os!s,

Die)! $*o 47 'e (ni!Die)! 2*!ei*$ ; 'e (ni!V*i*$e o+e"e*d 1 'e (ni!Fi6ed o+e"e*d 4155555

Ne! in)o2e *so'!ion 2e!"od 475555S*$es 'i)e 'e (ni! 485

>8. 0"*! %o($d J Co. "*+e e'o!ed *s i!s in)o2e e#oe in)o2e !*6es i# i! "*d (sed +*i*$e)os!in&

*. 475555 . 4>;55). 4=>;55d. )*n! e de!e2ined #o2 !"e in#o2*!ion &i+en

ANS0ER, MEDIUM

>;. 0"*! %*s !"e !o!*$ *2o(n! o# SGA e6'ense in)(ed : J Co.

*. 475555 . 4=3;55

). 4=555d. )*n! e de!e2ined #o2 !"e in#o2*!ion &i+en

ANS0ER, MEDIUM

>=. B*sed on +*i*$e )os!in& %"*! %o($d J Co. s"o% *s !"e +*$(e o# i!s endin& in+en!o:

*. 4135555 . 4=8;55). 43>555d. 438555

ANS0ER, ) EASY




Use !"e #o$$o%in& in#o2*!ion #o @(es!ions >>9>.

T"e #o$$o%in& in#o2*!ion "*s een e6!*)!ed #o2 P Co.s #in*n)i*$ e)ods #o i!s #is! :e* o#o'e*!ions,

Uni!s 'od()ed 15555Uni!s so$d >555V*i*$e )os!s 'e (ni!,

Die)! 2*!ei*$ 4?Die)! $*o M*n(#*)!(in& o+e"e*d 7SGA 8

Fi6ed )os!s,M*n(#*)!(in& o+e"e*d 4>5555SGA 75555

>>. B*sed on *so'!ion )os!in& P Co.s in)o2e in i!s #is! :e* o# o'e*!ions %i$$ e

*. 431555 "i&"e !"*n i! %o($d e (nde +*i*$e )os!in&. . 4>5555 "i&"e !"*n i! %o($d e (nde +*i*$e )os!in&.). 475555 "i&"e !"*n i! %o($d e (nde +*i*$e )os!in&.d. "i&"e !"*n i! %o($d e (nde +*i*$e )os!in& (! !"e e6*)! di##een)e )*nno! e

de!e2ined #o2 !"e in#o2*!ion &i+en.

ANS0ER, * MEDIUM

>?. B*sed on *so'!ion )os!in& !"e Cos! o# Goods M*n(#*)!(ed #o P Co.s #is! :e* %o($d e

*. 4355555. . 43>5555.). 4755555.d. 4315555.

ANS0ER, MEDIUM

>. B*sed on *so'!ion )os!in& %"*! *2o(n! o# 'eiod )os!s %i$$ P Co. ded()!

*. 4>5555 . 4>555). 475555d. 4;?555

ANS0ER, d MEDIUM




?5. Fo i!s 2os! e)en! #is)*$ :e* * #i2 e'o!ed !"*! i!s )on!i(!ion 2*&in %*s e@(*$ !o 85 'e)en! o# s*$es *nd !"*! i!s ne! in)o2e *2o(n!ed !o 15 'e)en! o# s*$es. I# i!s #i6ed )os!s#o !"e :e* %ee 4=5555 "o% 2()" %ee s*$es

*. 41;5555 . 4355555). 4=55555d. )*n! e de!e2ined #o2 !"e in#o2*!ion &i+en

ANS0ER, MEDIUM

?1. A! i!s 'esen! $e+e$ o# o'e*!ions * s2*$$ 2*n(#*)!(in& #i2 "*s !o!*$ +*i*$e )os!s e@(*$!o >; 'e)en! o# s*$es *nd !o!*$ #i6ed )os!s e@(*$ !o 1; 'e)en! o# s*$es. B*sed on +*i*$e)os!in& i# s*$es )"*n&e : 41.55 in)o2e %i$$ )"*n&e :

*. 45.3;. . 45.15.

). 45.>;.d. )*n! e de!e2ined #o2 !"e in#o2*!ion &i+en.

ANS0ER, * EASY

?3. Yo( o!*in !"e #o$$o%in& in#o2*!ion e&*din& #i6ed 'od()!ion )os!s #o2 *2*n(#*)!(in& #i2 #o #is)*$ :e* 3551,

Fi6ed )os!s in !"e e&innin& in+en!o: 4 1=555Fi6ed )os!s in)(ed !"is 'eiod 155555

0"i)" o# !"e #o$$o%in& s!*!e2en!s is not true,

*. T"e 2*6i2(2 *2o(n! o# #i6ed 'od()!ion )os!s !"*! !"is #i2 )o($d ded()! (sin&*so'!ion )os!s in 3551 is 411=555.

. T"e 2*6i2(2 di##een)e e!%een !"is #i2s 3551 in)o2e *sed on *so'!ion)os!in& *nd i!s in)o2e *sed on +*i*$e )os!in& is 41=555.

). Usin& +*i*$e )os!in& !"is #i2 %i$$ ded()! no 2oe !"*n 41=555 #o #i6ed 'od()!ion )os!s.

d. I# !"is #i2 'od()ed s(s!*n!i*$$: 2oe (ni!s !"*n i! so$d in 3551 +*i*$e )os!in&%i$$ 'o*$: :ie$d * $o%e in)o2e !"*n *so'!ion )os!in&.

ANS0ER, ) MEDIUM




Use !"e #o$$o%in& in#o2*!ion #o @(es!ions ?79?=.

Si2'$e Co'. 'od()es * sin&$e 'od()!. T"e #o$$o%in& )os! s!()!(e *''$ied !o i!s #is! :e* o#o'e*!ions 3551,

V*i*$e )os!s,SGA 43 'e (ni!Pod()!ion 48 'e (ni!

Fi6ed )os!s !o!*$ )os! in)(ed #o !"e :e*,SGA 418555Pod()!ion 435555

?7. Ass(2e #o !"is @(es!ion on$: !"*! d(in& 3551 Si2'$e Co'. 2*n(#*)!(ed ;555 (ni!s*nd so$d 7?55. T"ee %*s no e&innin& o endin& %o<-in-'o)ess in+en!o:. Ho% 2()"$*&e o s2*$$e %o($d Si2'$e Co'.s in)o2e e i# i! (ses *so'!ion *!"e !"*n +*i*$e)os!in&

*. T"e *so'!ion )os!in& in)o2e %o($d e 4=555 $*&e. . T"e *so'!ion )os!in& in)o2e %o($d e 4=555 s2*$$e.). T"e *so'!ion )os!in& in)o2e %o($d e 48?55 $*&e.d. T"e *so'!ion )os!in& in)o2e %o($d e 48555 s2*$$e.

ANS0ER, ) MEDIUM

?8. Ass(2e #o !"is @(es!ion on$: !"*! Si2'$e Co'. 2*n(#*)!(ed *nd so$d ;555 (ni!s in3551. A! !"is $e+e$ o# *)!i+i!: i! "*d *n in)o2e o# 475555 (sin& +*i*$e )os!in&. 0"*!%*s !"e s*$es 'i)e 'e (ni!

*. 41=.55 . 41?.?5). 413.?5d. 418.?5

ANS0ER, MEDIUM

?;. Ass(2e #o !"is @(es!ion on$: !"*! Si2'$e Co'. 'od()ed ;555 (ni!s *nd so$d 8;55(ni!s in 3551. I# Si2'$e (ses *so'!ion )os!in& i! %o($d ded()! 'eiod )os!s o#

*. 438555. . 478555.). 43>555.d. 437555.

ANS0ER, d MEDIUM




?=. Ass(2e #o !"is @(es!ion on$: !"*! Si2'$e Co'. 2*n(#*)!(ed ;555 (ni!s *nd so$d 8555in 3551. I# Si2'$e e2'$o:s * )os!in& s:s!e2 *sed on +*i*$e )os!s !"e )o2'*n: %o($dend 3551 %i!" * #inis"ed &oods in+en!o: o#

*. 48555. . 4?555.). 4=555.d. 4;555.

ANS0ER, * MEDIUM

Use !"e #o$$o%in& in#o2*!ion #o @(es!ions ?>9?.

T"e #o$$o%in& in#o2*!ion %*s e6!*)!ed #o2 !"e #is! :e* *so'!ion-*sed *))o(n!in& e)odso# Con#(sed Co.

To!*$ #i6ed )os!s in)(ed 4155555

To!*$ +*i*$e )os!s in)(ed ;5555To!*$ 'eiod )os!s in)(ed >5555To!*$ +*i*$e 'eiod )os!s in)(ed 75555Uni!s 'od()ed 35555Uni!s so$d 13555Uni! s*$es 'i)e 413

?>. 0"*! is Cos! o# Goods So$d #o Con#(sed Co.s #is! :e*

*. 4?5555 . 45555

). 48?555d. )*n! e de!e2ined #o2 !"e in#o2*!ion &i+en

ANS0ER, ) DIFFICULT

??. I# Con#(sed Co. "*d (sed +*i*$e )os!in& in i!s #is! :e* o# o'e*!ions "o% 2()" in)o2e$oss e#oe in)o2e !*6es %o($d i! "*+e e'o!ed

*. 4=555 . 4;8555). 43=555d. 43555

ANS0ER, d DIFFICULT




?. B*sed on +*i*$e )os!in& i# Con#(sed "*d so$d 13551 (ni!s ins!e*d o# 13555 i!s in)o2e e#oe in)o2e !*6es %o($d "*+e een

*. 4.;5 "i&"e. . 411.55 "i&"e.). 4?.;5 "i&"e.d. 4?.77 "i&"e.

ANS0ER, ) MEDIUM

5. Q Co'. in)(ed !"e #o$$o%in& )os!s in 3551 i!s #is! :e* o# o'e*!ions *sed on 'od()!ion o# 15555 (ni!s,

Die)! 2*!ei*$ 4; 'e (ni!Die)! $*o 47 'e (ni!V*i*$e 'od()! )os!s 43 'e (ni!Fi6ed 'od()! )os!s in !o!*$ 4155555

0"en Q Co'. 'e'*ed i!s 3551 #in*n)i*$ s!*!e2en!s i!s Cos! o# Goods So$d %*s $is!ed *!4155555. B*sed on !"is in#o2*!ion %"i)" o# !"e #o$$o%in& s!*!e2en!s 2(s! e true,

*. Q Co'. so$d *$$ 15555 (ni!s !"*! i! 'od()ed. . Q Co'. so$d ;555 (ni!s.). Q Co'. "*d * +e: 'o#i!*$e :e*.d. Fo2 !"e in#o2*!ion &i+en one )*nno! !e$$ %"e!"e Q Co'.s #in*n)i*$ s!*!e2en!s

%ee 'e'*ed *sed on +*i*$e o *so'!ion )os!in&.

ANS0ER, MEDIUM




Use !"e #o$$o%in& in#o2*!ion #o @(es!ions 197.

T"ee ne% )o2'*nies J Y *nd Q e&*n o'e*!ions on *n(*: 1 3551. Conside !"e #o$$o%in&o'e*!in& )os!s !"*! %ee in)(ed : !"ese )o2'*nies d(in& !"e )o2'$e!e )*$end* :e* 3551,

Co2'*n: J Co2'*n: Y Co2'*n: QPod()!ion in (ni!s 15555 15555 15555S*$es 'i)e 'e (ni! 415 415 415Fi6ed 'od()!ion )os!s 415555 435555 475555V*i*$e 'od()!ion )os!s 475555 435555 415555V*i*$e SGA 415555 435555 475555Fi6ed SGA 475555 435555 415555

1. B*sed on s*$es o# >555 (ni!s %"i)" )o2'*n: %i$$ e'o! !"e &e*!e in)o2e e#oe

in)o2e !*6es #o 3551 (nde *so'!ion )os!in&

*. Co2'*n: J

. Co2'*n: Y). Co2'*n: Qd. A$$ o# !"e )o2'*nies %i$$ e'o! !"e s*2e in)o2e.

ANS0ER, d MEDIUM

3. B*sed on s*$es o# >555 (ni!s %"i)" )o2'*n: %i$$ e'o! !"e &e*!e in)o2e e#oein)o2e !*6es #o 3551 (nde +*i*$e )os!in&

*. Co2'*n: J . Co2'*n: Y

). Co2'*n: Qd. A$$ o# !"e )o2'*nies %i$$ e'o! !"e s*2e in)o2e.

ANS0ER, * MEDIUM

7. B*sed on s*$es o# 15555 (ni!s %"i)" )o2'*n: %i$$ e'o! !"e &e*!e in)o2e e#oein)o2e !*6es #o 3551 (nde +*i*$e )os!in&

*. Co2'*n: J . Co2'*n: Y). Co2'*n: Qd. A$$ o# !"e )o2'*nies %i$$ e'o! !"e s*2e in)o2e e#oe in)o2e !*6es.

ANS0ER, d MEDIUM




Use !"e #o$$o%in& in#o2*!ion #o @(es!ions 89=.

V Co. 'od()es * sin&$e 'od()! !"*! se$$s #o 4>.55 'e (ni!. S!*nd*d )*'*)i!: is 155555 (ni!s 'e :e* 155555 (ni!s %ee 'od()ed *nd ?5555 (ni!s %ee so$d d(in& !"e :e*. M*n(#*)!(in&)os!s *nd se$$in& *nd *d2inis!*!i+e e6'enses *e 'esen!ed e$o%.

T"ee %ee no +*i*n)es #o2 !"e s!*nd*d +*i*$e )os!s. An: (nde- o o+e*''$ied o+e"e*d is%i!!en o## die)!$: *! :e*-end *s *n *d(s!2en! !o )os! o# &oods so$d.

Fi6ed )os!s V*i*$e )os!sDie)! 2*!ei*$ 45 41.;5 'e (ni! 'od()edDie)! $*o 5 1.55 'e (ni! 'od()edM*n(#*)!(in& o+e"e*d 1;5555 5.;5 'e (ni! 'od()edSe$$in& Ad2in. ?5555 5.;5 'e (ni! so$d

V "*d no in+en!o: *! !"e e&innin& o# !"e :e*.

8. In 'esen!in& in+en!o: on !"e *$*n)e s"ee! *! De)e2e 71 !"e (ni! )os! (nde*so'!ion )os!in& is

*. 43.;5. . 47.55.). 47.;5.d. 48.;5.

ANS0ER, d MEDIUM

;. 0"*! is !"e ne! in)o2e (nde +*i*$e )os!in&

*. 4;5555 . 4?5555). 45555d. 4135555

ANS0ER, * MEDIUM

=. 0"*! is !"e ne! in)o2e (nde *so'!ion )os!in&

*. 4;5555 . 4?5555). 45555d. 4135555

ANS0ER, MEDIUM




>. A #i2 "*s #i6ed )os!s o# 4355555 *nd +*i*$e )os!s 'e (ni! o# 4=. I! '$*ns on se$$in&85555 (ni!s in !"e )o2in& :e*. To e*$ie * 'o#i! o# 435555 !"e #i2 2(s! "*+e * s*$es 'i)e 'e (ni! o# *! $e*s!

*. 411.55. . 411.;5.). 415.55.d. 415.;5.

ANS0ER, MEDIUM

?. A #i2 "*s #i6ed )os!s o# 4355555 *nd +*i*$e )os!s 'e (ni! o# 4=. I! '$*ns on se$$in&85555 (ni!s in !"e )o2in& :e*. I# !"e #i2 '*:s in)o2e !*6es on i!s in)o2e *! * *!e o# 85 'e)en! %"*! s*$es 'i)e 2(s! !"e #i2 (se !o o!*in *n *#!e-!*6 'o#i! o# 438555 on !"e85555 (ni!s

*. 411.=5

. 411.7=). 413.55d. 413.;5

ANS0ER, ) DIFFICULT


Be$o% is *n in)o2e s!*!e2en! #o Bende Co. #o 3551,

S*$es 4855555

V*i*$e )os!s 13;555 Con!i(!ion 2*&in 43>;555Fi6ed )os!s 355555Po#i! e#oe !*6es 4 >;555

. 0"*! is Bendes de&ee o# o'e*!in& $e+e*&e

*. 7.=> . ;.77). 1.8;d. 3.=>

ANS0ER, * MEDIUM




155. B*sed on !"e )os! *nd e+en(e s!()!(e on !"e in)o2e s!*!e2en! %"*! %*s Bendes e*<-e+en 'oin! #o 3551 in do$$*s

*. 4355555 . 473;555). 4755555d. 4355

ANS0ER, d MEDIUM

151. 0"*! %*s Bendes 2*&in o# s*#e!: #o 3551

*. 4355555 . 4>;555). 4155555d. 41551

ANS0ER, d EASY

153. Ass(2in& !"*! !"e #i6ed )os!s *e e6'e)!ed !o e2*in *! 4355555 #o 3553 *nd !"e s*$es 'i)e 'e (ni! *nd +*i*$e )os!s 'e (ni! *e *$so e6'e)!ed !o e2*in )ons!*n! "o% 2()" 'o#i! e#oe !*6es %i$$ e 'od()ed i# !"e )o2'*n: *n!i)i'*!es 3553 s*$es isin& !o 175 'e)en! o# !"e 3551 $e+e$

*. 4>;55 . 41;555). 41;>;55d. A 'edi)!ion )*nno! e 2*de #o2 !"e in#o2*!ion &i+en.

ANS0ER, ) MEDIUM




Use !"e #o$$o%in& in#o2*!ion #o @(es!ions 157 *nd 158.

Ti2e$ine 'od()es *nd se$$s * sin&$e 'od()!. In#o2*!ion on i!s )os!s #o 3551 #o$$o%,

V*i*$e )os!s,SGA 43 'e (ni!Pod()!ion 48 'e (ni!

Fi6ed )os!s,SGA 413555 'e :e* Pod()!ion 41;555 'e :e*

157. Ass(2e Ti2e$ine 'od()ed *nd so$d ;555 (ni!s in 3551. A! !"is $e+e$ o# *)!i+i!: i! 'od()ed * 'o#i! o# 41?555. 0"*! %*s Ti2e$ines s*$es 'i)e 'e (ni!

*. 41;.55 . 411.85). 4.=5

d. 415.55

ANS0ER, * MEDIUM

158. In 3553 Ti2e$ine es!i2*!es !"*! i! %i$$ 'od()e *nd se$$ 8555 (ni!s. T"e +*i*$e )os!s 'e (ni! *nd !"e !o!*$ #i6ed )os!s *e e6'e)!ed !o e !"e s*2e *s in 3551. Ho%e+e i!*n!i)i'*!es * s*$es 'i)e o# 41= 'e (ni!. 0"*! is Ti2e$ines 'oe)!ed 2*&in o# s*#e!: in3553

*. 4>555 . 435?55

). 41?855d. 417555

ANS0ER, MEDIUM

15;. S!o: M*n(#*)!(in& in)(s *nn(*$ #i6ed )os!s o# 43;5555 in 'od()in& *nd se$$in&T*$es. Es!i2*!ed (ni! s*$es #o 3551 *e 13;555. An *#!e-!*6 in)o2e o# 4>;555 isdesied : 2*n*&e2en!. T"e )o2'*n: 'oe)!s i!s in)o2e !*6 *!e *! 85 'e)en!. 0"*! is!"e 2*6i2(2 *2o(n! !"*! S!o: )*n e6'end #o +*i*$e )os!s 'e (ni! *nd s!i$$ 2ee! i!s 'o#i! oe)!i+e i# !"e s*$es 'i)e 'e (ni! is es!i2*!ed *! 4=

*. 47.7> . 47.;). 47.55d. 47.>5

ANS0ER, ) MEDIUM




Use !"e #o$$o%in& in#o2*!ion #o @(es!ions 15= *nd 15>.

T"e #o$$o%in& in#o2*!ion e$*!es !o #in*n)i*$ 'oe)!ions o# Bi& Co. #o 3551,

Poe)!ed s*$es =5555 (ni!sPoe)!ed +*i*$e )os!s 43.55 'e (ni!Poe)!ed #i6ed )os!s 4;5555 'e :e* Poe)!ed (ni! s*$es 'i)e 4>.55

15=. Ho% 2*n: (ni!s %o($d Bi& Co. need !o se$$ in 3551 !o e*n * 'o#i! e#oe !*6es o#415555

*. 3;>18 . 15555). ?;>1d. 13555

ANS0ER, d MEDIUM

15>. I# Bi& Co. *)"ie+es i!s 'oe)!ions in 3551 %"*! %i$$ e i!s de&ee o# o'e*!in& $e+e*&e

*. =.55 . 1.35). 1.=?d. 3.85

ANS0ER, MEDIUM

15?. Si&n*$ Co. 2*n(#*)!(es * sin&$e 'od()!. Fo 3551 !"e )o2'*n: "*d s*$es o# 45555+*i*$e )os!s o# 4;5555 *nd #i6ed )os!s o# 475555. Si&n*$ e6'e)!s i!s )os! s!()!(e *nds*$es 'i)e 'e (ni! !o e2*in !"e s*2e in 3553 "o%e+e !o!*$ s*$es *e e6'e)!ed !o (2' : 35 'e)en!. I# !"e 3553 'oe)!ions *e e*$ied ne! in)o2e in 3553 s"o($d e6)eed ne!in)o2e in 3551 :

*. 155 'e)en!. . ?5 'e)en!.). 35 'e)en!.d. ;5 'e)en!.

ANS0ER, MEDIUM





Di+esi#ied Co'. 2*n(#*)!(es *nd se$$s !%o 'od()!s, J *nd Y. T"e o'e*!in& es($!s o# !"e)o2'*n: #o 3551 #o$$o%,

Pod()! J Pod()! YS*$es in (ni!s 3555 7555S*$es 'i)e 'e (ni! 415 4;V*i*$e )os!s 'e (ni! > 7

In *ddi!ion !"e )o2'*n: in)(ed !o!*$ #i6ed )os!s in !"e *2o(n! o# 4555.

15. Ho% 2*n: !o!*$ (ni!s %o($d !"e )o2'*n: "*+e needed !o se$$ !o e*<e+en in 3551

*. 7>;5 . >;5). 7=55

d. 1?55

ANS0ER, * MEDIUM

115. I# !"e )o2'*n: %o($d "*+e so$d * !o!*$ o# =555 (ni!s in 3551 )onsis!en! %i!" CVP*ss(2'!ions "o% 2*n: o# !"ose (ni!s %o($d :o( e6'e)! !o e Pod()! Y

*. 7555 . 8555). 7=55d. 7;55

ANS0ER, ) MEDIUM

111. Ho% 2*n: (ni!s %o($d !"e )o2'*n: "*+e needed !o se$$ in 3551 !o 'od()e * 'o#i! o#413555

*. ?>;5 . 35555). 15555d. ?855

ANS0ER, * MEDIUM




113. Be$o% is *n in)o2e s!*!e2en! #o e%e$$ Co. #o 3553,

S*$es 4 755555V*i*$e )os!s 1;5555 Con!i(!ion 2*&in 4 1;5555Fi6ed )os!s 155555 Po#i! e#oe !*6es 4 ;5555

0"*! %*s !"e )o2'*n:s 2*&in o# s*#e!: in 3553

*. 4;5555 . 4155555). 41;5555d. 43;555

ANS0ER, MEDIUM

117. Be$o% is *n in)o2e s!*!e2en! #o e%e$$ Co. #o 3553,

S*$es 4755555V*i*$e )os!s 1;5555Con!i(!ion 2*&in 41;5555Fi6ed )os!s 155555Po#i! e#oe !*6es 4 ;5555

I# !"e (ni! s*$es 'i)e #o e%e$$s so$e 'od()! %*s 415 "o% 2*n: (ni!s %o($d i! "*+eneeded !o se$$ in 3553 !o 'od()e * 'o#i! o# 485555

*. 3>;55 . 3555). 3?555d. )*n! e de!e2ined #o2 !"e in#o2*!ion &i+en

ANS0ER, ) MEDIUM

118. A #i2 es!i2*!es !"*! i! %i$$ se$$ 155555 (ni!s o# i!s so$e 'od()! in !"e )o2in& 'eiod. I! 'oe)!s !"e s*$es 'i)e *! 485 'e (ni! !"e CM *!io *! =5 'e)en! *nd 'o#i! *! 4;55555.0"*! is !"e #i2 (d&e!in& #o #i6ed )os!s in !"e )o2in& 'eiod

*. 41=55555 . 43855555). 41155555d. 4155555

ANS0ER, d MEDIUM




11;. H*! Co. 2*n(#*)!(es * %es!en-s!:$e "*! !"*! se$$s #o 415 'e (ni!. T"is is i!s so$e 'od()! *nd i! "*s 'oe)!ed !"e e*<-e+en 'oin! *! ;5555 (ni!s in !"e )o2in& 'eiod. I##i6ed )os!s *e 'oe)!ed *! 4155555 %"*! is !"e 'oe)!ed )on!i(!ion 2*&in *!io

*. ?5 'e)en! . 35 'e)en!). 85 'e)en!d. =5 'e)en!

ANS0ER, MEDIUM

11=. B*ndo Co. 2*n(#*)!(es $i!!$e o6es o# *d *!!i!(des. E*)" o6 se$$s #o 41;. T"e #i2s 'oe)!ed )os!s #o 3553 *e $is!ed e$o%,

V*i*$e )os!s 'e (ni!,Pod()!ion 4;SGA 1

Fi6ed )os!s,Pod()!ion 485555SGA =5555Es!i2*!ed +o$(2e 35555 (ni!s

0"*! is B*ndos 'oe)!ed 2*&in o# s*#e!: #o 3553

*. 4177777 . 41;5555). 4?5555d. 4155555

ANS0ER, * MEDIUM




11>. B*ndo Co. 2*n(#*)!(es $i!!$e o6es o# *d *!!i!(des. E*)" o6 se$$s #o 41;. T"e #i2s 'oe)!ed )os!s #o 3553 *e $is!ed e$o%,

V*i*$e )os!s 'e (ni!,Pod()!ion 4;SGA 1

Fi6ed )os!s,Pod()!ion 485555SGA =5555Es!i2*!ed +o$(2e 35555 (ni!s

0"*! is B*ndos 'oe)!ed de&ee o# o'e*!in& $e+e*&e #o 3553

*. 3.3; . 1.?5). 7.>;d. 1.=>

ANS0ER, * MEDIUM

Use !"e #o$$o%in& in#o2*!ion #o @(es!ions 11?9135.

Be$o% *e in)o2e s!*!e2en!s !"*! *''$: !o !"ee )o2'*nies, A B *nd C,

Co2'*n: A Co2'*n: B Co2'*n: CS*$es 4155 4155 4155V*i*$e )os!s 15 35 75Con!i(!ion 2*&in 45 4?5 4>5

Fi6ed )os!s 75 35 15 Po#i! e#oe !*6es 4 =5 4 =5 4 =5

11?. 0i!"in !"e e$e+*n! *n&e i# s*$es &o (' : 41 #o e*)" #i2 %"i)" #i2 %i$$ e6'eien)e !"e&e*!es! in)e*se in 'o#i!

*. Co2'*n: A . Co2'*n: B). Co2'*n: Cd. )*n! e de!e2ined #o2 !"e in#o2*!ion &i+en

ANS0ER, * EASY




11. 0i!"in !"e e$e+*n! *n&e i# s*$es &o (' : one (ni! #o e*)" #i2 %"i)" #i2 %i$$e6'eien)e !"e &e*!es! in)e*se in ne! in)o2e

*. Co2'*n: A . Co2'*n: B). Co2'*n: Cd. )*n! e de!e2ined #o2 !"e in#o2*!ion &i+en

ANS0ER, d EASY

135. A! s*$es o# 4155 %"i)" #i2 "*s !"e "i&"es! 2*&in o# s*#e!:

*. Co2'*n: A . Co2'*n: B). Co2'*n: Cd. T"e: *$$ "*+e !"e s*2e 2*&in o# s*#e!:.

ANS0ER, ) MEDIUM

131. A$*n is in!ees!ed in en!ein& !"e )*!#is" #*2in& (siness. He es!i2*!es i# "e en!es !"is (siness "is #i6ed )os!s %o($d e 4;5555 'e :e* *nd "is +*i*$e )os!s %o($d e@(*$ 75 'e)en! o# s*$es. I# e*)" )*!#is" se$$s #o 43 "o% 2*n: )*!#is" %o($d A$*n need !o se$$ !o&ene*!e * 'o#i! !"*! is e@(*$ !o 15 'e)en! o# s*$es

*. 85555 . 81==>). 7;555d. No $e+e$ o# s*$es )*n &ene*!e * 15 'e)en! ne! e!(n on s*$es.

ANS0ER, DIFFICULT

133. T"e #o$$o%in& in#o2*!ion 'e!*ins !o No+* Co.s )os!-+o$(2e-'o#i! e$*!ions"i's,

Be*<-e+en 'oin! in (ni!s so$d 1555V*i*$e )os!s 'e (ni! 4;55To!*$ #i6ed )os!s 41;5555

Ho% 2()" %i$$ e )on!i(!ed !o 'o#i! e#oe !*6es : !"e 1551s! (ni! so$d

*. 4=;5 . 4;55). 41;5d. 45

ANS0ER, ) MEDIUM




137. In#o2*!ion )on)enin& L*e$ Co'o*!ions Pod()! A #o$$o%s,

S*$es 4755555V*i*$e )os!s 385555Fi6ed )os!s 85555

Ass(2in& !"*! L*e$ in)e*sed s*$es o# Pod()! A : 35 'e)en! %"*! s"o($d !"e 'o#i!#o2 Pod()! A e

*. 435555 . 438555). 473555d. 4?5555

ANS0ER, ) MEDIUM

138. Linds*: Co2'*n: e'o!ed !"e #o$$o%in& es($!s #o2 s*$es o# ;555 (ni!s o# Pod()! A #o

(ne,

S*$es 4355555V*i*$e )os!s 135555Fi6ed )os!s =5555 O'e*!in& in)o2e 4 35555

Ass(2e !"*! Linds*: in)e*ses !"e se$$in& 'i)e o# Pod()! A : 15 'e)en! in ($:. Ho%2*n: (ni!s o# Pod()! A %o($d "*+e !o e so$d in ($: !o &ene*!e *n o'e*!in& in)o2e o#435555

*. 8555 . 8755). 8;55d. ;555

ANS0ER, * MEDIUM




THE FOLLOWING MULTIPLE CHOICE EL!TE TO M!TEI!L CO"EE# IN THE!PPEN#I$ OF THE CH!PTE%

13;. On * e*<-e+en )"*! !"e e*<-e+en 'oin! is $o)*!ed *! !"e 'oin! %"ee !"e !o!*$

*. e+en(e $ine )osses !"e !o!*$ #i6ed )os! $ine. . e+en(e $ine )osses !"e !o!*$ )on!i(!ion 2*&in $ine.). #i6ed )os! $ine in!ese)!s !"e !o!*$ +*i*$e )os! $ine.d. e+en(e $ine )osses !"e !o!*$ )os! $ine.

ANS0ER, d EASY

13=. In * CVP &*'" !"e s$o'e o# !"e !o!*$ e+en(e $ine indi)*!es !"e

*. *!e *! %"i)" 'o#i! )"*n&es *s +o$(2e )"*n&es. . *!e *! %"i)" !"e )on!i(!ion 2*&in )"*n&es *s +o$(2e )"*n&es.). *!io o# in)e*se o# !o!*$ #i6ed )os!s.

d. !o!*$ )os!s 'e (ni!.

ANS0ER, MEDIUM

13>. In * CVP &*'" !"e *e* e!%een !"e !o!*$ )os! $ine *nd !"e !o!*$ e+en(e $ine e'esen!s!o!*$

*. )on!i(!ion 2*&in. . +*i*$e )os!s.). #i6ed )os!s.d. 'o#i!.

ANS0ER, d EASY

13?. In * CVP &*'" !"e *e* e!%een !"e !o!*$ )os! $ine *nd !"e !o!*$ #i6ed )os! $ine :ie$ds !"e

*. #i6ed )os!s 'e (ni!. . !o!*$ +*i*$e )os!s.). 'o#i!.d. )on!i(!ion 2*&in.

ANS0ER, EASY




13. I# SAB Co2'*n:s #i6ed )os!s %ee !o in)e*se !"e e##e)! on * 'o#i!-+o$(2e &*'" %o($d e !"*! !"e

*. )on!i(!ion 2*&in $ine %o($d s"i#! ('%*d '**$$e$ !o !"e 'esen! $ine. . )on!i(!ion 2*&in $ine %o($d s"i#! do%n%*d '**$$e$ !o !"e 'esen! $ine.). s$o'e o# !"e )on!i(!ion 2*&in $ine %o($d e 2oe 'ono(n)ed s!ee'e.d. s$o'e o# !"e )on!i(!ion 2*&in $ine %o($d e $ess 'ono(n)ed #$*!!e.

ANS0ER, MEDIUM

175. I# SAB Co2'*n:s +*i*$e )os!s 'e (ni! %ee !o in)e*se (! i!s (ni! se$$in& 'i)e s!*:s)ons!*n! !"e e##e)! on * 'o#i!-+o$(2e &*'" %o($d e !"*! !"e

*. )on!i(!ion 2*&in $ine %o($d s"i#! ('%*d '**$$e$ !o !"e 'esen! $ine. . )on!i(!ion 2*&in $ine %o($d s"i#! do%n%*d '**$$e$ !o !"e 'esen! $ine.). s$o'e o# !"e )on!i(!ion 2*&in $ine %o($d e 'ono(n)ed s!ee'e.d. s$o'e o# !"e )on!i(!ion 2*&in $ine %o($d e $ess 'ono(n)ed #$*!!e.

ANS0ER, d EASY

171. T"e 2os! (se#($ in#o2*!ion dei+ed #o2 * )os!-+o$(2e-'o#i! )"*! is !"e

*. *2o(n! o# s*$es e+en(e needed !o )o+e en!e'ise +*i*$e )os!s. . *2o(n! o# s*$es e+en(e needed !o )o+e en!e'ise #i6ed )os!s.). e$*!ions"i' *2on& e+en(es +*i*$e )os!s *nd #i6ed )os!s *! +*io(s $e+e$s o#

*)!i+i!:.d. +o$(2e o o(!'(! $e+e$ *! %"i)" !"e en!e'ise e*<s e+en.

ANS0ER, ) EASY

&HOT !N&WE'PO(LEM&

1. 0": do 2*n*&es #e@(en!$: 'e#e +*i*$e )os!in& !o *so'!ion )os!in& #o in!en*$ (se

ANS0ER, M*n*&es 2*: 'e#e +*i*$e )os!in& e)*(se i! )$*ssi#ies )os!s o!" :!"ei #(n)!ion *nd !"ei e"*+io. 0"en )os!s *e )$*ssi#ied : e"*+io 2*n*&es )*n2oe *))(*!e$: 'edi)! "o% !o!*$ )os!s %i$$ )"*n&e %"en +o$(2e )"*n&es. 0i!" 2oe*))(*!e in#o2*!ion 2*n*&es )*n 2*<e e!!e 'od()!ion *nd 'i)in& de)isions.

MEDIUM




3. 0": is +*i*$e )os!in& no! (sed e6!ensi+e$: in e6!en*$ e'o!in&

ANS0ER, V*i*$e )os!in& is no! (sed e6!ensi+e$: o(!side o# !"e #i2 e)*(se*so'!ion )os!in& is e@(ied : GAAP *nd !"e IRS.

MEDIUM

7. Ho% )*n * )o2'*n: 'od()e o!" +*i*$e *nd *so'!ion )os!in& in#o2*!ion #o2 *sin&$e *))o(n!in& s:s!e2

ANS0ER, Fi2s on$: "*+e one *))o(n!in& in#o2*!ion s:s!e2. T"is s:s!e2 %i$$ e *sed on ei!"e +*i*$e o *so'!ion )os!in&. I# !"e s:s!e2 needs !o 'o+ide in#o2*!ionin o!" !"e +*i*$e *nd *so'!ion #o2*!s !"e s:s!e2s *))o(n!in& in#o2*!ion )*n e)on+e!ed #o2 one #o2*! !o !"e o!"e. T"e )on+esion e@(ies *n *d(s!2en! !o !"e 'od()! in+en!o: *))o(n!s *nd !"e *2o(n! o# 'od()! )os!s )"*&ed *&*ins! !"e 'eiodsin)o2e. T"e )on+esion is !:'i)*$$: e*sie i# s!*nd*d )os!in& is e2'$o:ed.

MEDIUM

8. 0"*! *e !"e 2*o di##een)es e!%een +*i*$e *nd *so'!ion )os!in&

ANS0ER, T"e 2*o di##een)e e!%een +*i*$e )os!in& *nd *so'!ion )os!in& is in!"e %*: e*)" de#ines 'od()! )os!. 0"i$e *so'!ion )os!in& in)$(des #i6ed 2*n(#*)!(in&o+e"e*d *s * 'od()! )os! +*i*$e )os!in& !e*!s i! *s * )os! o# !"e 'eiod. A se)ond*:di##een)e e!%een !"e !%o 2e!"ods is !"e #o2*! o# !"e in)o2e s!*!e2en!. Aso'!ion)os!in& (!i$ies !"e !*di!ion*$ in)o2e s!*!e2en! #o2*! !"*! )*!e&oies )os!s : !"ei#(n)!ion on$:. V*i*$e )os!in& (ses *n in)o2e s!*!e2en! #o2*! !"*! )*!e&oies )os!s : o!" !"ei #(n)!ion *nd e"*+io.

MEDIUM

;. 0": is *so'!ion )os!in& no! (sed #o CVP *n*$:sis

ANS0ER, Aso'!ion )os!in& is no! (sed in e*<-e+en *n*$:sis e)*(se i! 'esen!s *)$*ssi#i)*!ion o# )os!s : #(n)!ion *!"e !"*n : e"*+io. 0i!"o(! * e"*+io*$)$*ssi#i)*!ion o# )os!s i! is i2'ossi$e !o 'edi)! "o% !o!*$ )os!s )"*n&e *s +o$(2e)"*n&es.

MEDIUM




=. Ho% do )"*n&es in +o$(2e *##e)! !"e e*<-e+en 'oin!

ANS0ER, 0i!"in !"e e$e+*n! *n&e !"e e*<-e+en 'oin! does no! )"*n&e. T"is isd(e !o !"e $ine*i!: *ss(2'!ions !"*! *''$: !o !o!*$ e+en(es #i6ed )os!s *nd +*i*$e)os!s.

MEDIUM

>. 0"*! 2*o *ss(2'!ion do 2($!i'od()! #i2s need !o 2*<e in (sin& CVP *n*$:sis !"*!sin&$e-'od()! #i2s need no! 2*<e

ANS0ER, T"e *ss(2'!ion !"*! 2(s! e i2'osed is * )ons!*n! s*$es 2i6. A2($!i'od()! #i2 *ss(2es !"*! %i!"in !"e e$e+*n! *n&e !"e s*$es 2i6 is )ons!*n!. T"is 'e2i!s CVP *n*$:sis !o e 'e#o2ed (sin& * (ni! o# !"e )ons!*n! s*$es 2i6.

MEDIUM

?. 0"*! i2'o!*n! in#o2*!ion is )on+e:ed : !"e 2*&in o# s*#e!: )*$)($*!ion in CVP*n*$:sis

ANS0ER, T"e e*<-e+en 'oin! in CVP *n*$:sis is )i!i)*$ e)*(se i! di+ides 'o#i!*$e $e+e$s o# o'e*!ion #o2 (n'o#i!*$e $e+e$s o# o'e*!ion. T"e 2*&in o# s*#e!:&i+es 2*n*&es *n ide* o# !"e e6!en! !o %"i)" s*$es )*n #*$$ e#oe o'e*!ions %i$$ e)o2e(n'o#i!*$e.

MEDIUM





Li2'in Co. 2*n(#*)!(es *nd se$$s %*$<in& )*nes. T"e #o$$o%in& in)o2e s!*!e2en! *''$ies !o3551 i!s #is! :e* o# o'e*!ions,

S*$es ?55 (ni!s 41; 413555Cos! o# Goods So$d ?555Goss M*&in 4 8555Se$$in& &ene*$ *nd *d2inis!*!i+e e6'enses 7555 O'e*!in& in)o2e 4 1555

O!"e in#o2*!ion,1. T"e )o2'*n: 'od()ed 1555 (ni!s d(in& !"e :e*.3. V*i*$e SGA e6'enses *e 41 'e )*ne.7. V*i*$e 'od()!ion )os!s *e 4> 'e )*ne.8. T"ee %*s no endin& %o<-in-'o)ess in+en!o:.

. Ho% 2()" #i6ed 2*n(#*)!(in& o+e"e*d did !"e Li2'in Co. in)( in 3551

ANS0ER, T"e Cos! o# Goods So$d is *sed on s*$es o# ?55 (ni!s *nd is e)oded *!4?555. T"is 4?555 is )o2'ised o# 4;=55 o# +*i*$e 'od()! )os!s 4> ?55.T"ee#oe 43855 o# !"e Cos! o# Goods So$d is #i6ed. Gi+en !"*! !"e #i2 so$d ?5 'e)en!o# i!s o(!'(! ?55/1555 43855 2(s! e ?5 'e)en! o# !"e !o!*$ #i6ed 2*n(#*)!(in&o+e"e*d in)(ed. T"is se!s !"e !o!*$ #i6ed 2*n(#*)!(in& o+e"e*d )os!s in)(ed *!47555.

MEDIUM

15. 0"*! %ee !"e !o!*$ +*i*$e )os!s in)(ed in 3551

ANS0ER, T"e !o!*$ +*i*$e 'od()! )os!s %o($d e 4;=55/.?5 4>555. T"e !o!*$+*i*$e SGA %o($d e 41 ?55 4?55. To!*$ +*i*$e )os!s in)(ed *e 4>555 4?55 4>?55.

MEDIUM

11. I# !"e Li2'in Co. *do'!ed +*i*$e )os!in& !"e endin& #inis"ed &oods in+en!o: #o 3551%o($d e )*ied *! %"*! +*$(e

ANS0ER, T"e *ns%e is 355 (ni!s 4> 41855.

EASY





T"e Co%n Co. 2*n(#*)!(es !o*s!es. T"e )o2'*n: "ied * )os! *))o(n!*n! in i!s #is! :e* o#o'e*!ions 3551 !o e6'$*in !o 2*n*&e2en! "o% i!s )os!s e"*+ed. A#!e s!(d:in& +*io(sdo)(2en!s *nd ind(s!: d*!* !"e )os! *))o(n!*n! *nno(n)ed !"*! !"e !o!*$ SGA e6'enses !"*!!"e #i2 )*n e6'e)! !o in)( in *n: 'eiod is )*'!(ed : !"e e@(*!ion, Y 4;5555 415J%"ee Y is !"e !o!*$ SGA e6'ense in)(ed *nd J is !"e n(2e o# (ni!s so$d. A$so !"e*))o(n!*n! *nno(n)ed !"*! !"e !o!*$ 'od()! )os!s in)(ed in *n: 'eiod )o($d e )*'!(ed : !"e#o2($* Y 4155555 4=J %"ee Y is !"e !o!*$ 2*n(#*)!(in& )os! in)(ed *nd J is !"en(2e o# (ni!s 'od()ed. In 3551 !"e #i2 'od()ed 15555 (ni!s *nd so$d 555 o# !"e2 *! 47;e*)".

13. A))odin& !o !"e *))o(n!*n!s e@(*!ions %"*! %o($d e !"e !o!*$ o# *$$ )os!s in)(ed :!"e #i2 in 3551

ANS0ER, To!*$ 'od()!ion )os!s *e *sed on !"e n(2e o# (ni!s 'od()ed *nd%o($d e, 15555 4= 4155555 41=5555. To!*$ 'eiod )os!s %o($d e *sed on

!"e n(2e o# (ni!s so$d *nd %o($d e, 555 415 4;5555 4185555. T"e !o!*$ o#*$$ )os!s %o($d e 41=5555 4185555 4755555.

MEDIUM

17. I# !"e #i2s )os!s )on#o2ed e6*)!$: !o !"e *))o(n!*n!s e@(*!ions "o% 2()" in)o2e e#oe in)o2e !*6es %o($d e e'o!ed #o 3551 i# !"e #i2 (ses *so'!ion )os!in&

ANS0ER,S*$es 47; 555 471;555Cos! o# Goods So$d,

Be&. #in. &oods in+en!o: 4 5Cos! o# Goods M*n(#*)!(ed 1=5555Goods *+*i$*$e 41=5555Endin& in+en!o: 1=555Cos! o# Goods So$d 188555 Goss 2*&in 41>1555Less 'eiod )os!s 185555 In)o2e e#oe in)o2e !*6es 4 71555

MEDIUM




18. I# !"e #i2s )os!s )on#o2ed e6*)!$: !o !"e *))o(n!*n!s e@(*!ions "o% 2()" in)o2e e#oe in)o2e !*6es %o($d e e'o!ed #o 3551 i# !"e #i2 (ses +*i*$e )os!in&

ANS0ER,S*$es 471;555Less +*i*$e )os!s,

Pod()! )os!s 4= 555 4;8555Peiod )os!s 415 555 5555 188555 Con!i(!ion 2*&in 41>1555

Less #i6ed )os!s,Pod()! )os!s 4155555Peiod )os!s ;5555 1;5555In)o2e e#oe in)o2e !*6es 4 31555

MEDIUM

1;. S!*n$e: Co'. 'od()es * sin&$e 'od()!. T"e #o$$o%in& is * )os! s!()!(e *''$ied !o i!s

#is! :e* o# o'e*!ions 3551,

S*$es 'i)e 41; 'e (ni!V*i*$e )os!s,

SGA 43 'e (ni!Pod()!ion 48 'e (ni!

Fi6ed )os!s !o!*$ )os! in)(ed #o !"e :e*,SGA 418555Pod()!ion 435555

D(in& 3551 S!*n$e: Co'. 2*n(#*)!(ed ;555 (ni!s *nd so$d 7?55. T"ee %*s no

e&innin& o endin& %o<-in-'o)ess in+en!o:.

*. Ho% 2()" in)o2e e#oe in)o2e !*6es %o($d e e'o!ed i# S!*n$e: (ses*so'!ion )os!in&

. Ho% 2()" in)o2e e#oe in)o2e !*6es %o($d e e'o!ed i# +*i*$e )os!in& %*s(sed

). S"o% %": !"e !%o )os!in& 2e!"ods &i+e di##een! in)o2e *2o(n!s.




ANS0ER,*. In)o2e (nde *so'!ion )os!in& is,

S*$es 41; 7?55 4;>555COGS 7?55 48 435555/;555 75855GM 43==55

O'e. E6'.VSE 43 7?55 4 >=55FSE 18555 31=55Aso'!ion in)o2e e#oe in)o2e !*6es 4 ;555

. In)o2e (nde +*i*$e )os!in&,CMU SP 9 VPod.Cos! 9 VSGA 41; 9 48 9 43 4Vo$. so$d 7?55CM 478355Less, FC 9 Pod()!ion 35555SGA 18555 V*i*$e )os!in& in)o2e e#oe in)o2e !*6es 4 355

). Re*son #o di##een)e in in)o2e,Fi6ed )os!s e6'ensed (nde *so'. )os!in&COGS 7?55 435555/;555 (ni!s 41;355Fi6ed SGA 18555To!*$ 43355

Fi6ed )os!s e6'ensed (nde +*i*$e )os!in&Fi6ed SGA 418555Fi6ed Pod()!ion 35555To!*$ FC 478555

Di##een)e in FC e6'ensed (nde !%o 2e!"ods 4 8?55

T"is is *$so !"e di##een)e in in)o2e *2o(n!s.

MEDIUM




Use !"e #o$$o%in& in#o2*!ion #o @(es!ions 1= *nd 1>.

In#o2*!ion e$*!in& !o !"e 3551 o'e*!ions o# M)Ni)<$e Co'. #o$$o%s,

S*$es 4135555V*i*$e )os!s 7=555 Con!i(!ion 2*&in 4 ?8555Fi6ed )os!s >5555 Po#i! e#oe !*6es 4 18555

1=. M)Ni)<$es e*<-e+en 'oin! #o 3551 %*s 1555 (ni!s. Co2'(!e M)Ni)<$es s*$es 'i)e 'e (ni!.

ANS0ER, T"e e*<-e+en 'oin! is #o(nd : di+idin& !"e #i6ed )os!s : !"e CM *!io.

T"e CM *!io is,

4?8555/4135555 >5. Be*<e+en %o($d !"en e,

4>5555/.>5 4155555. Sin)e %e *$so <no% !"*! !"e e*<-e+en 'oin! is de#ined*s 1555 (ni!s i! 2(s! #o$$o% !"*! !"e (ni! s*$es 'i)e is 4155555/1555 4155.

MEDIUM

1>. Co2'(!e M)Ni)<$es de&ee o# o'e*!in& $e+e*&e #o 3551.

ANS0ER, T"e de&ee o# o'e*!in& $e+e*&e is )o2'(!ed *s !"e )on!i(!ion 2*&indi+ided : 'o#i! e#oe !*6es, 4?8555/418555 =.

MEDIUM




Use !"e #o$$o%in& in#o2*!ion #o @(es!ions 1? *nd 1.

Dos Co. 2*n(#*)!(es *nd se$$s 3 'od()!s, A *nd B. T"e 'oe)!ed in#o2*!ion on !"ese !%o 'od()!s #o 3553 is,

Pod()! A Pod()! BS*$es in (ni!s 8555 1555S*$es 'i)e 'e (ni! 413 4?V*i*$e )os!s 'e (ni! ? 8

To!*$ #i6ed )os!s #o !"e )o2'*n: *e 'oe)!ed *! 415555.

1?. Co2'(!e Dos Co.s 'oe)!ed e*<-e+en 'oin! #o 3553 in !o!*$ (ni!s.

ANS0ER, T"e )o2'*n: *n!i)i'*!es * s*$es 2i6 )onsis!in& o# 8 (ni!s o# Pod()! A *nd1 (ni! o# Pod()! B. T"e !o!*$ )on!i(!ion 2*&in #o one (ni! o# s*$es 2i6 %o($d e 435.T"is )onsis!s o# 41= o# )on!i(!ion 2*&in #o2 !"e 8 (ni!s o# Pod()! A *nd 48 o#

)on!i(!ion 2*&in #o2 1 (ni! o# Pod()! B.

T"e o+e*$$ )o2'*n: e*<e+en is #o(nd : di+idin& !o!*$ #i6ed )os!s : !"e )on!i(!ion2*&in on one (ni! o# s*$es 2i6, 415555/435 ;55 (ni!s. T"e ;55 (ni!s o# s*$es 2i6)on!*in ;55 ; (ni!s o# 'od()! #o * !o!*$ o# 3;55. O# !"e 3;55 !o!*$ (ni!s 3555 *e(ni!s o# Pod()! A *nd ;55 *e (ni!s o# Pod()! B.

MEDIUM

1. Ho% 2*n: (ni!s %o($d !"e )o2'*n: need !o se$$ !o 'od()e *n in)o2e e#oe in)o2e!*6es e@(*$ !o 1; 'e)en! o# s*$es

ANS0ER, A&*in (sin& * (ni! o# s*$es 2i6 *s !"e (ni! o# *n*$:sis one (ni! o# s*$es 2i6se$$s #o 4;=. Sin)e !"e )on!i(!ion 2*&in is 435 on one (ni! o# s*$es 2i6 !"e CM *!ioon one (ni! o# s*$es 2i6 is 435/4;= .7;>1. T"is i2'$ies !"*! +*i*$e )os!s *s * 'e)en!*&e o# s*$es *e e@(*$ !o 1 9 .7;>1 .=83. In)o2e e#oe in)o2e !*6es e@(*$ !o1; 'e)en! o# s*$es )*n e #o(nd : so$+in& * #o2($* o# !"e #o$$o%in& !:'e,

S*$es 9 VC 9 FC In)o2e e#oe in)o2e !*6es

In !"is '*!i)($* )*se %e so$+e !"e #o$$o%in& #o2($*,S*$es 9 .=83 S*$es 9 415555 .1; S*$es

So$+in& #o S*$es %e &e! 48?3?=. 0e )*n #ind o(! "o% 2*n: (ni!s o# s*$es 2i6 *ee@(ied !o &ene*!e s*$es o# 48?3?= : di+idin& 48?3?= : 4;= ?=7. T"ese ?=7 (ni!so# s*$es 2i6 e*)" )on!*in ; (ni!s o# 'od()! so !"e )oe)! *ns%e %o($d e ?=7 ; 871; (ni!s o# 'od()! 78;3 o# Pod()! A *nd ?=7 o# Pod()! B.

MEDIUM




Use !"e #o$$o%in& in#o2*!ion #o @(es!ions 35 *nd 31.

P Co'. 'edi)!s i! %i$$ 'od()e *nd se$$ 85555 (ni!s o# i!s so$e 'od()! in 3551. A! !"*! $e+e$ o#+o$(2e i! 'oe)!s * s*$es 'i)e o# 475 'e (ni! * )on!i(!ion 2*&in *!io o# 85 'e)en! *nd#i6ed )os!s o# 4; 'e (ni!.

35. 0"*! is !"e )o2'*n:s 'oe)!ed e*<e+en #o 3551 in do$$*s *nd (ni!s

ANS0ER, Gi+en !"e CM *!io o# 85 'e)en! *nd !"e S*$es 'i)e 'e (ni! o# 475 !"eCM 'e (ni! 2(s! e 475 .85 413. T"e !o!*$ #i6ed )os!s %o($d e 'oe)!ed *! 4; 85555 4355555. Be*<e+en %o($d e, 4355555/413 1===> (ni!s. T"is %o($d *$soe@(*!e !o 4;55555 o# s*$es.

MEDIUM

31. 0"*! %o($d !"e )o2'*n:s 'oe)!ed 'o#i! e i# i! 'od()ed *nd so$d 75555 (ni!s

ANS0ER,Poe)!ed 'o#i! %o($d e,

S*$es 75555 475 455555V*i*$e )os!s 75555 41? ;85555 Con!i(!ion 2*&in 47=5555Fi6ed )os!s 355555 Po#i! 41=5555

MEDIUM




(es!ions 33 *nd 37 *e *sed on !"e #o$$o%in& d*!* 'e!*inin& !o !%o !:'es o# 'od()!s2*n(#*)!(ed : Won Co'.,

Pe (ni!S*$es 'i)e V*i*$e )os!s

Pod()! Y 4135 4 >5Pod()! Q 4;55 4355

Fi6ed )os!s !o!*$ 4755555 *nn(*$$:. T"e e6'e)!ed 2i6 in (ni!s is =5 'e)en! #o Pod()! Y *nd 85 'e)en! #o Pod()! Q.

33. Ho% 2()" is Wons e*<-e+en 'oin! s*$es in (ni!s

ANS0ER,BEP (ni!s FC/(ni! SP 9 (ni! VC o (ni! CMUMCFo 2($!i'$e 'od()!s (se !"e %ei&"!ed CM %i!" %ei&"!s *sed on (ni!s o# s*$es %ei&"!s.

BEP FC / K=5 4135 9 4>5 85 4;55 9 4355 4755555/ 475/( 4135/( 3555 (ni!s

MEDIUM

37. 0"*! *e Wons e*<-e+en 'oin! s*$es in do$$*s

ANS0ER,BEP do$$*s FC/CMR Fo 2($!i'$e 'od()!s (se %ei&"!ed CMR %i!" %ei&"!s *sed on s*$es do$$*s *s %ei&"!s

o s*$es 2i6.

S*$es 2i6 is =5 'e)en! *nd 85 'e)en! in (ni!s o in do$$*s.0ei&"!ed *+e*&e CMR 0ACM/0AS*$e0ACMR K=5 4135 9 4>5 85 4;55 9 4355 X =5 4135 85 4;550ACMR K475 4135 X K4>3 4355 .;;1BEP s*$es 3555 43>3 4;88555

MEDIUM



119;5 C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis

38. T"is 2*<es no sense *! *$$ s*id Bi$$ S"*' 'esiden! o# Esse6 Co2'*n:. 0e so$d !"es*2e n(2e o# (ni!s !"is :e* *s %e did $*s! :e* :e! o( 'o#i!s "*+e 2oe !"*n do($ed.0"o 2*de !"e &oo#!"e )o2'(!e o !"e 'eo'$e %"o o'e*!e i! T"e s!*!e2en!s !o%"i)" M. S"*' %*s e#ein& *e s"o%n "ee *so'!ion )os!in& *sis,

3551 3553S*$es 35555 (ni!s e*)" :e* 4>55555 4>55555Less )os! o# &ood so$d 8=5555 855555Goss 2*&in 4385555 4755555Less se$$in& *nd *d2inis!*!i+e e6'enses 355555 355555In)o2e e#oe in)o2e !*6es 4 85555 4155555

T"e )o2'*n: %*s o&*nied on *n(*: 1 3551 so !"e 'e+io(s s!*!e2en!s s"o% !"ees($!s o# i!s #is! !%o :e*s o# o'e*!ion. In !"e #is! :e* !"e )o2'*n: 'od()ed *nd so$d35555 (ni!s in !"e se)ond :e* !"e )o2'*n: *&*in so$d 35555 (ni!s (! i! in)e*sed 'od()!ion in ode !o "*+e * s!o)< o# (ni!s on "*nd *s s"o%n "ee,

3551 3553Pod()!ion in (ni!s 35555 3;555S*$es in (ni!s 35555 35555V*i*$e 'od()!ion )os! 'e (ni! 4? 4?Fi6ed o+e"e*d )os!s !o!*$ 4755555 4755555

Fi6ed o+e"e*d )os!s *e *''$ied !o (ni!s o# 'od()! on * *sis o# e*)" :e*s 'od()!ion.T"e )o2'*n: 'od()es *nd se$$s * sin&$e 'od()!. V*i*$e se$$in& *nd *d2inis!*!i+ee6'enses *e 41 'e (ni! so$d.

e)u*red+

1. Co2'(!e !"e )os! o# sin&$e (ni! o# 'od()! #o e*)" :e* (nde,*. *so'!ion )os!in&. . +*i*$e )os!in&.

3. 0"*! is !"e +*$(e o# endin& in+en!o: in 3553 (nde,*. #($$ )os! . +*i*$e )os!



C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis 119;1

ANS0ER,3551 3553

1. * V*i*$e 2*n. 4 ? 4 ? Fi6ed 2*n. 1; 13 3551 4755555 41;

437 435 35555

3553 4755555 4133;555

. V*i*$e 2*n. 3551 35534? 4?

3. *. ;555 437 411;555

. ;555 35 155555

MEDIUM




3;. T"e #o$$o%in& d*!* "*+e een !*<en #o2 !"e e)ods o# * )o2'*n:,

Pod()!ion in (ni!s d(in& 3551 355555Uni!s so$d d(in& 3551 15555Se$$in& 'i)e 'e (ni! 41;.55S!*nd*d +*i*$e )os!s 'e (ni!,

M*!ei*$ *nd $*o 4?.55 Indie)! 2*n(#*)!(in& )os!s 3.55

Se$$in& *d2inis!*!i+e e6'enses 1.55 411.55Fi6ed )os!s (d&e!ed #o :e*,

Indie)! 2*n(#*)!(in& )os!s 4855555Se$$in& *d2inis!*!i+e e6'enses 755555 4>55555

e)u*red+1. De!e2ine !"e in)o2e $oss e#oe in)o2e !*6es #o !"e :e* 3551 (nde

* *so'!ion )os!in& *nd +*i*$e )os!in&.

3. 0"*! is !"e +*$(e o# endin& in+en!o: (nde * *so'!ion )os!in& *nd +*i*$e )os!in&

7. Re)on)i$e !"e di##een)e in !"e !%o in)o2es.



C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis 119;7

ANS0ER,1. *. .

S*$es 43?;5555 S*$es 43?;5555 9 COG S 15555 13 33?5555 9 VC 15555 11 355555

4 ;>5555 CM 4 >=5555 9 SLA 85555 9 FC >55555In)o2e e#oe in)o2e !*6es 4 ?5555 In)o2e e#oe in)o2e !*6es 4 =5555

3. PRODUCT COST*. 413 15555 4135555 ABSORPTION VARIABLE

. 415 15555 4155555VAR 415 415

855555FIJ 3 355555

413 415

7. ∆ NI 355555 9 15555 43 435555

MEDIUM




3=. A)!(*$ )os!s #o Soni) In). #o !"e '*s! :e* %ee *s #o$$o%s,

Die)! 2*!ei*$ 3 'o(nds 4; 415 'e (ni!Die)! $*o 7 "o(s 415 475 'e (ni!V*i*$e se$$in& *nd *d2inis!*!i+e 43 'e (ni!Fi6ed se$$in& *nd *d2inis!*!i+e 4?5555

D(in& !"e :e* 15555 (ni!s %ee 'od()ed *nd 555 (ni!s %ee so$d. T"ee %ee no e&innin& in+en!oies. T"i!: !"o(s*nd die)! $*o "o(s %ee %o<ed d(in& !"e :e*.A)!(*$ o+e"e*d #o !"e :e* !o!*$ed 43;3555 o# %"i)" 4185555 %*s #i6ed. Se$$in& 'i)e 4155/(ni!.

B(d&e!ed #i6ed o+e"e*d %*s 41;5555 *nd !"e e6'e)!ed *)!i+i!: $e+e$ %*s 75555 die)!$*o "o(s. V*i*$e o+e"e*d %*s (d&e!ed *! 7 die)! $*o "o(s 'e (ni! *nd 48 'edie)! $*o "o(.

T"e )o2'*n: (ses * no2*$ )os!in& s:s!e2 *nd o+e"e*d +*i*n)es *e )$osed !o )os! o#

&oods so$d.

e)u*red+*. De!e2ine !"e (ni! )os! (sin& +*i*$e )os!in&.

. De!e2ine !"e (ni! )os! (sin& *so'!ion )os!in&.

). Usin& +*i*$e )os!in& de!e2ine !"e )on!i(!ion 2*&in *nd +*i*$e )os!in&in)o2e.

d. Usin& *so'!ion )os!in& de!e2ine !"e &oss 2*&in *nd *so'!ion )os!in&

in)o2e.



C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis 119;;

ANS0ER,

*. DM 415DL 75V-FOH 7 48 13

4;3

. DM 415DL 75V-FOH 13F-FOH 7 4; 1; 41;5555 4;

4=> 75555

). Se$$ Pi)e 4155 9 VAR Cos! ;8 4;3 43

CM 4 8= 555 (ni!s 4818555 9 FC 375555

In)o2e e#oe in)o2e !*6es STD 41?8555 #*+o*$e VAR-FOH SPD VAR ?555In)o2e e#oe in)o2e !*6es *)!(*$ 413555

V*i*$e FOH s'endin& +*i*n)e 4113555 9 75555 48 4?555 F

d. SP 4155 9 COGS =>GM 4 77 555 (ni!s 43>555 9 SA EJP 555 43 4?5555 ?555In)o2e e#oe in)o2e !*6es STD 41555

F*+o*$e +*i*n)e ?555In)o2e e#oe in)o2e !*6es *)!(*$ 435>555

MEDIUM



119;= C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis

3>. S'o!s Inno+*!os "*s de+e$o'ed * ne% desi&n !o 'od()e "(d$es !"*! *e (sed in !*)<*nd #ie$d )o2'e!i!ion. T"e )o2'*n:s "(d$e desi&n is inno+*!i+e in !"*! !"e "(d$e :ie$ds%"en "i! : * (nne *nd i!s "ei&"! is e6!*odin*i$: e*s: !o *d(s!. M*n*&e2en!es!i2*!es e6'e)!ed *nn(*$ )*'*)i!: !o e 5555 (ni!s o+e"e*d is *''$ied (sin& e6'e)!ed*nn(*$ )*'*)i!:. T"e )o2'*n:s )os! *))o(n!*n! 'edi)!s !"e #o$$o%in& 3551 *)!i+i!ies *nde$*!ed )os!s,

S!*nd*d (ni! +*i*$e 2*n(#*)!(in& )os!s 413V*i*$e (ni! se$$in& e6'ense 4;Fi6ed 2*n(#*)!(in& o+e"e*d 48?5555Fi6ed se$$in& *nd *d2inis!*!i+e e6'enses 417=555Se$$in& 'i)e 'e (ni! 47;Uni!s o# s*$es ?5555Uni!s o# 'od()!ion ?;555Uni!s in e&innin& in+en!o: 15555

O!"e !"*n *n: 'ossi$e (nde- o o+e*''$ied #i6ed o+e"e*d 2*n*&e2en! e6'e)!s no

+*i*n)es #o2 !"e 'e+io(s 2*n(#*)!(in& )os!s. Unde- o o+e*''$ied #i6ed o+e"e*d is!o e %i!!en o## !o Cos! o# Goods So$d.

e)u*red+1. De!e2ine !"e *2o(n! o# (nde- o o+e*''$ied #i6ed o+e"e*d (sin& * +*i*$e

)os!in& *nd *so'!ion )os!in&.

3. Pe'*e 'oe)!ed in)o2e s!*!e2en!s (sin& * +*i*$e )os!in& *nd *so'!ion)os!in&.

7. Re)on)i$e !"e in)o2es dei+ed in '*! 3.



C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis 119;>

ANS0ER,

1. *. 45

. 5555 9 ?;555 4;.77 43==;5 U

3. *. S*$es ?5555 47; 43?55555 9 VC ?5555 41> 17=5555 CM 41885555 9 FC =1=555In)o2e e#oe in)o2e !*6es 4 ?38555

. S*$es ?5555 47; 43?55555 9 COGS 41>.77 ?5555 17?=855

GM 41817=55 9 SA ;7=555

In)o2e e#oe in)o2e STD 4 ?>>=55

9 VOL VAR 3==;5 In)o2e e#oe in)o2e !*6es 4 ?;5;5

7. ;555 4;.77 43==;5.

MEDIUM



119;? C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis

3?. On De)e2e 75 3551 * o2 $*s! des!o:ed !"e ($< o# !"e *))o(n!in& e)ods o# !"eHone Di+ision * s2*$$ one-'od()! 2*n(#*)!(in& di+ision !"*! (ses s!*nd*d )os!s *nd#$e6i$e (d&e!s. A$$ +*i*n)es *e %i!!en o## *s *ddi!ions !o o ded()!ions #o2 in)o2enone *e 'o-*!ed !o in+en!oies. In *ddi!ion !"e )"ie# *))o(n!*n! 2:s!eio(s$:dis*''e*ed. Yo( "*+e !"e !*s< o# e)ons!()!in& !"e e)ods #o !"e :e* 3551. T"e&ene*$ 2*n*&e "*s s*id !"*! !"e *))o(n!*n! "*s een e6'ei2en!in& %i!" o!" *so'!ion)os!in& *nd +*i*$e )os!in&.

T"e e)ods *e * 2ess (! :o( "*+e &*!"eed !"e #o$$o%in& d*!* #o 3551,

*. C*s" on "*nd De)e2e 71 3551 415 . S*$es 413?555). A)!(*$ #i6ed indie)! 2*n(#*)!(in& )os!s 31555d. A))o(n!s e)ei+*$e De)e2e 71 3551 35555e. S!*nd*d +*i*$e 2*n(#*)!(in& )os!s 'e (ni! 1#. V*i*n)es #o2 s!*nd*d o# *$$ +*i*$e 2*n(#*)!(in& )os!s 4;555 U&. O'e*!in& in)o2e *so'!ion-)os!in& *sis 418855

". A))o(n!s '*:*$e De)e2e 71 3551 1?555i. Goss 'o#i! *so'!ion )os!in& *! s!*nd*d

e#oe ded()!in& +*i*n)es 33855 . To!*$ $i*i$i!ies 155555<. Un#*+o*$e (d&e! +*i*n)e #i6ed 2*n(#*)!(in& )os!s 1555 U$. No!es e)ei+*$e #o2 )"ie# *))o(n!*n! 85552. Con!i(!ion 2*&in *! s!*nd*d e#oe ded()!in& +*i*n)es 8?555n. Die)!-2*!ei*$ '()"*ses *! s!*nd*d 'i)es ;5555o. A)!(*$ se$$in& *nd *d2inis!*!i+e )os!s *$$ #i6ed =555

T"ese do no! ne)ess*i$: "*+e !o e so$+ed in *n: '*!i)($* ode. I&noe in)o2e !*6es.

e)u*red+1. O'e*!in& in)o2e on * +*i*$e-)os!in& *sis.3. N(2e o# (ni!s so$d.7. N(2e o# (ni!s 'od()ed.8. N(2e o# (ni!s (sed *s !"e deno2in*!o !o o!*in #i6ed indie)! )os! *''$i)*!ion

*!e 'e (ni! on *so'!ion-)os!in& *sis.;. Did in+en!o: in (ni!s in)e*se o de)e*se E6'$*in.=. B: no% 2()" in do$$*s did !"e in+en!o: $e+e$ )"*n&e * (nde *so'!ion

)os!in& (nde +*i*$e )os!in&>. V*i*$e 2*n(#*)!(in& )os! o# &oods so$d *! s!*nd*d 'i)es.?. M*n(#*)!(in& )os! o# &oods so$d *! s!*nd*d 'i)es *so'!ion )os!in&.




ANS0ER,

1. CM 48?555 A)!(*$ #i6 2#& 431555 9 FC 3=555 9 (n#*+o*$e VAR 1555 O'e*!in& In)o2e STD 433555 #i6 )os! STD 435555 9 (n#*+o*$e +*i*n)es =555O'e*!in& In)o2e *)!(*$ 41=555

3. S*$es 413?555 9 CM 8?555 VC 4 ?5555/41 UNIT ?5555 (ni!s so$d

7. S*$es 413?555 9 GM 33855COGS 415;=55/?5555 41.73

Di##een)e in OI P 9 S #i6 2#&/(ni!

41=55 P 9 ?5555 4.73 P >;555

8. OI 9 *so'!ion )os! 433855 9 4=555 41=855 OI STD 18855 OI ACT

+*i*n)es 4 3555 UNF 9 o!"e VAR =555 UNFVOL VAR 4 8555 FAV

48555 F >;555 9 J 4.73J =3;55 (ni!s 'od()ed

;. In+en!o: de)e*sed. OI *so'!ion is $ess !"*n OI +*i*$e.

=. Aso'!ion )os! ;555 (ni!s 41.73 4==55V*i*$e )os! ;555 (ni!s 41 4;555

>. ?5555 (ni!s 41 4?5555

?. ?5555 41.73 415;=55

DIFFICULT



119=5 C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis

3. S2i!" Co2'*n: 'od()es *nd se$$s !%o 'od()!s, A *nd B in !"e *!io o# 7A !o ;B.Se$$in& 'i)es #o A *nd B *e es'e)!i+e$: 41355 *nd 4385 es'e)!i+e +*i*$e )os!s *e48?5 *nd 41=5. T"e )o2'*n:s #i6ed )os!s *e 41?55555 'e :e*.

Co2'(!e !"e +o$(2e o# s*$es in (ni!s o# e*)" 'od()! needed !o,

e)u*red+*. e*<e+en.

. e*n 4?55555 o# in)o2e e#oe in)o2e !*6es.

). e*n 4?55555 o# in)o2e *#!e in)o2e !*6es *ss(2in& * 75 'e)en! !*6 *!e.

d. e*n 13 'e)en! on s*$es e+en(e in e#oe-!*6 in)o2e.

e. e*n 13 'e)en! on s*$es e+en(e in *#!e-!*6 in)o2e *ss(2in& * 75 'e)en! !*6*!e.



C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis 119=1

ANS0ER,

A SP 41355 B SP 4385 9 VC 8?5 9 VC 1=5 CM 4 >35 CM 4 ?5

0ei&"!ed CM 7 4>35 ; 4?5 43;=5

*. 41?55555 >57.13; A >58 7 3113 (ni!s43;=5 B >58 ; 7;35

. 41?55555 4?55555 151;.=3; A 151= 7 758? (ni!s43;=5 B 151= ; ;5?5

). 4?55555/1 9 .7 41183?;>

41?55555 41183?;> 118.;; A 11;5 7 78;5 (ni!s43;=5 B 11;5 ; ;>;5

d. SP 7 41355 ; 4385 48?55

J 41?55555 4.13J 487;8?743;=5/48?55

A 487;8?7 .>;/41355 3>33 (ni!sB 487;8?7 .3;/4385 8;7>

e. J 41?55555 4.13J 1 9 .7 48>7=?8

43;=5/48?55

A 48>7=?8 .>;/41355 715 (ni!sB 48>7=?8 .3;/4385 ;1?1

MEDIUM




75. T"e ones Co2'*n: 2*<es !"ee 'od()!s. D*!* #o$$o%,

Pod()! A Pod()! B Pod()! CSe$$in& 'i)e 415 435 485V*i*$e )os!s > 13 1=

To!*$ *nn(*$ #i6ed )os!s *e 4?85555. T"e #i2s e6'eien)e "*s een !"*! *o(! 35 'e)en! o# do$$* s*$es )o2e #o2 'od()! A =5 'e)en! #o2 B *nd 35 'e)en! #o2 C.

e)u*red+*. Co2'(!e e*<-e+en in s*$es do$$*s.

. De!e2ine !"e n(2e o# (ni!s !o e so$d *! !"e e*<-e+en 'oin!.



C"*'!e 11 Aso'!ion/V*i*$e Cos!in& *nd Cos!-Vo$(2e-Po#i! An*$:sis 119=7

ANS0ER,A B C

*. SP 415 435 485 9 VC > 13 1= CM 4 7 4 ? 438CMR 75 85 =5

CMR .3 75 .= 85 .3 =5 83

BE 4?85555/.83 43555555

. A 43555555 .35/415 85555 (ni!s

B 43555555 .=5/435 =5555 (ni!s

C 43555555 .35/485 15555 (ni!s

MEDIUM




71. T"e Fed Co2'*n: se$$s !%o 'od()!s A *nd B %i!" )on!i(!ion 2*&in *!ios o# 85 *nd75 'e)en! *nd se$$in& 'i)es o# 4; *nd 43.;5 * (ni!. Fi6ed )os!s *2o(n! !o 4>3555 *2on!". Mon!"$: s*$es *+e*&e 75555 (ni!s o# 'od()! A *nd 85555 (ni!s o# 'od()! B.

e)u*red+*. Ass(2in& !"*! !"ee (ni!s o# 'od()! A *e so$d #o e+e: #o( (ni!s o# 'od()! B

)*$)($*!e !"e do$$* s*$es +o$(2e ne)ess*: !o e*<e+en. . As '*! o# i!s )os! *))o(n!in& o(!ine Fed Co2'*n: *ssi&ns 47=555 in #i6ed )os!s !o

e*)" 'od()! e*)" 2on!". C*$)($*!e !"e e*<-e+en do$$* s*$es +o$(2e #o e*)" 'od()!.). Fed Co2'*n: is )onsidein& s'endin& *n *ddi!ion*$ 4>55 * 2on!" on *d+e!isin&

&i+in& 2oe e2'"*sis !o 'od()! A *nd $ess e2'"*sis !o 'od()! B. I# i!s *n*$:sis is)oe)! s*$es o# 'od()! A %i$$ in)e*se !o 85555 (ni!s * 2on!" (! s*$es o# 'od()! B%i$$ #*$$ !o 73555 (ni!s * 2on!". Re)*$)($*!e !"e e*<-e+en s*$es +o$(2e in do$$*s *!!"is ne% 'od()! 2i6. S"o($d !"e 'o'os*$ !o s'end !"e *ddi!ion*$ 4>55 * 2on!" e*))e'!ed

ANS0ER,

*. CM 7 43 8 4.>; 4SP 7 4; 8 43.;5 43;

BE 4>3555 48555554/43;

. A 47=555 45555 B 47=555 4135555 .8 .7

). CM ; 43 8 4.>; 417

SP ; 4; 8 43.;5 47;

BE 4>3555 4>55 431=3417/7;

OLD NE0CM A 75555 43 4=5555 CM A 85555 43 4 ?5555

B 85555 4.>; 75555 B 73555 4.>; 3855545555 4158555

9 FC >3555 9 FC ?1>55 OI 41?555 OI 4 33755

A! )(en! s*$es $e+e$s in)e*se *d+e!isin&.

Date post:	19-Feb-2018
Category:	Documents
Upload:	maria
View:	261 times
Download:	10 times

Accounting Test Bank

Documents