Reference no: EM133081458
Questions -
Q1. A company rents a building with a total of 50,000 square feet, which are evenly divided between two floors. The total monthly rent for the building is $30,000. The company allocates $20,000 of total rent expense to the first floor and $10,000 of total rent expense to the second floor. How much of the monthly rental expense should be allocated to a department that occupies 10,000 square feet on the first floor?
A) $3,000
B) $4,000
C) $8,000
D) $5,000
Q2. A retailer reports the following for its geographic divisions for the year. The profit margin for its Europe division is:
|
|
Americas
|
Europe
|
China
|
|
Income
|
$600,000
|
$160,000
|
$120,000
|
|
Sales
|
2,000,000
|
800,000
|
480,000
|
A) 20%
B) 15%
C) 30%
D) 25%
Q3. Ultimo Company operates three production departments as profit centers. The following information is available for its most recent year. Department 2's contribution to overhead in dollars is:
|
|
Department 1
|
Department 2
|
Department 3
|
|
Sales
|
$1,000,000
|
$400,000
|
$700,000
|
|
Cost of goods sold
|
700,000
|
150,000
|
300,000
|
|
Direct expenses
|
100,000
|
40,000
|
150,000
|
|
Indirect expenses
|
80,000
|
100,000
|
20,000
|
A) $350,000
B) $210,000
C) $150,000
D) $260,000
Q4. Carter Company reported the following financial numbers for one of its divisions for the year; average assets of $4,100,000; sales of $4,525,000; cost of goods sold of $2,550,000; and operating expenses of $1,372,300. Assume a target income of 10% of average assets. Compute residual income for the division:
A) $150,500
B) $197,500
C) $203,000
D) $192,700