Reference no: EM132791953

Questions -

Q1. Bert Company has a sales budget for next month of Php150,000. Cost of goods sold is expected to be 40 percent of sales. All goods are purchased in the month used and paid for in the month following purchase. The beginning inventory of merchandise is Php5,000, and an ending inventory of Php6,000 is desired. Beginning accounts payable is Php38,000.

The cost of goods sold for next month is expected to be

Php 90,000

Php 60,000

Php 89,000

Php 40,000

Q2. Hualien Company manufactures plugs used in its manufacturing cycle at a cost of Php45 per unit that includes Php10 of fixed overhead. Hualien needs 37,500 of these plugs annually, and Ochado Company has offered to sell these units to Hualien at Php42 per unit. If Hualien decided to purchase the plugs, Php75,000 of the annual fixed overhead applied will be eliminated, and the company may be able to rent the facility previously used for manufacturing the plugs.

If Hualien Company purchases the plugs but does not rent the unused facility, the company would

Lose Php 5.00 per unit

Save Php 3.00 per unit

Save Php 5.00 per unit

Lose Php 3.00 per unit

Q3. Compasibo Company's product has a labor standard of 2 hours per unit. For 2020, it estimates its production will be 200,000 units. It budgets total overhead at Php900,000, which results in a fixed overhead rate of Php1.50 per hour. Actual data for the year includes: Actual production, 198,000 units (440,000 direct labor hours), Actual variable overhead, Php352,000, Actual fixed overhead. The variable overhead efficiency variance for 2020 is

Php 35,520 F

Php 33,000 F

Php 33,000 UF

Php 66,000 UF

Q4. Chatime produces sugar cane in batches. The Company purchases a batch of sugar cane for Php80 from farmers and then crushes the cane in the company's plant at the cost of Php15. Two intermediate products, cane fiber, and cane juice emerge from the crushing process. The cane fiber can be sold for Php45 or processed further for Php25 to make the end product industrial fiber that is sold for Php90. The cane juice can be sold as is for Pho60 or processed further for Php35 to make the end product molasses that is sold for Php80.

What would you recommend?

Cane fiber should be processed further into industrial fiber; cane juice should not be processed further into molasses

Cane fiber should not be processed further into industrial fiber; cane juice should not be processed further into molasses

Cane fiber should not be processed further into industrial fiber; cane juice should be processed further into molasses

Cane fiber should be processed further into industrial fiber; cane juice should be processed further into molasses