55. Altoona Corporation has two divisions, Hinges and Doors,
which are both organized as profit centers; the Hinge Division
produces and sells hinges to the Door Division and to outside
customers. The Hinge Division has total costs of $43, $26 of which
are variable. The Hinge Division is operating significantly below
capacity and sells the hinges for $58.
The Door Division has received an offer from an outsider vendor to
supply all the hinges it needs (32,000 hinges) at a cost of $53.
The manager of the Door Division is considering the offer but wants
to approach the Hinge Division first.
What is the minimum transfer price from the Hinge Division to the
Door Division?
$53.
$26.
$43.
$58.
56. Riff, Inc. is working on its cash budget for June. The budgeted beginning cash balance is $20,000. Budgeted cash receipts total $192,000 and budgeted cash disbursements total $191,000. The desired ending cash balance is $48,000. The excess (deficiency) of cash available over disbursements for June will be:
$19,000.
$212,000.
$21,000.
$1,000.
57. Data on Gantry Company's direct-labor costs are given below:
Standard direct-labor hours | 40,000 | ||
Actual direct-labor hours | 39,000 | ||
Direct-labor efficiency variance-favorable | $ | 3,400 | |
Direct-labor rate variance-favorable | $ | 7,800 | |
Total direct labor payroll | $ | 124,800 | |
What was Gantry's actual direct-labor rate?
$3.00.
$3.20.
$3.40.
$7.80.
55 | $53 | |
Maximum price would be the market price the buyer would pay: $53 | ||
Because the Hinge Division is operating significantly below capacity | ||
and their variable cost is recovered in this. | ||
56 | $21,000 | |
Cash balance, beginning | 20000 | |
Add cash receipts as all sales are for cash | 192000 | |
Total cash available | 212000 | |
Less cash disbursements | -191000 | |
Excess (deficiency) of cash available over disbursements | 21000 | |
Financing | 27000 | |
Cash balance, ending | 48000 | |
57 | $3.20 | |
Total direct labor payroll / Actual direct-labor hours | ||
$124,800 / 39,000 |
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