400% - (Dividend yield x PE ratio) Payout Ratio Combined Ratio Operating Ratio Retention Ratio pom> DIFFICULT 10 - MAS. Time: 10 Seconds in the cost of quality, which of the following is/are not example/s of internal failure? |. Cost of inspecting products on the production line by quality inspectors Il, Labor cost of product designers whose task is to design components that will not break under extreme temperature conditions Ill. Cost of reworking defective parts detected by the quality assurance group IV, Cost of parts retumed by customers eee tea LE [DIFFICULT 8— MAS ‘Time: 60 Seconds ‘The Pilinut Company is a wholesaler distributor of candy. The company serves grocery, convenience and drug stores in a large metropolitan area. Small but steady growth in sales has been achieved by the company over the past few years, while caridy prices have been increasing. The company is formulating its plans for the coming fiscal year. Presented below are the data used to project the current | year’s after-tax net income of P 110,400. | Average sales price per box P 4.00 Average variable costs per box: Cost of candy P 2.00 Selling P 0.40 Total P2490 Annual fixed costs: Selling P 160,000 Administrative 280,000 | Total £440,000 Expected annual sales volume (390,000 boxes) P 1,560,000 Tax rate 40% Pilinut manufacturers have announced that they will increase prices of their products by 15% in the ‘coming year due to increases in materials and labor costs. The Pilinut Company expects that all other costs will remain at the same rates or levels as the current year. What should be the sales price per box that the company must charge to cover the 15% increase in the cost of candy and stil maintain the same contribution margin ratio? | EASY 6 — Management Advisory Services (MAS)_ Ti Sec design and development, is P900,000. The desired return on investment (RO!) is 22.22222%. What targy per unit must the company achieve to ensure it attains its desired ROI? A. P55 Cc. P60 | B. P36.8 D. P50 ‘A.company plans to sell 20,000 units at a price of P60 per unit. The cost to bring the product to market, ae Cost’‘astern Company manufactures special electrical equipment and par Eastern uses standard costs, with | | Separate standards established for each product. A special transformer is manufactured in the Transformer | | Department, Production volume is measured by direct labor hours in this department and a flexible budget | system is used to plan and control department overhead. Standard costs for the special transformer are | | determined annually in September forthe coming year. The standard cost of a transformer for 2013 was P | | 67.00. Direct materials: iron 5 sheets @ P 2.00 Copper 3 spools @ P 3.00 Direct labor 4 hours @ P 7.00 Variable overhead hours @ P 3.00 Fixed overhead 4 hours @ P 2.00 Total Overhead rates were based on normal and expected monthly labor hours for 2013, both of which were 4,000 P 10.00 P.9.00 P 28.00 P 12.00 P.8.00 | P 67.00 direct labor hours. Practical capacity for this department is 5,000 direct labor hours per month. Variable | overhead costs are expected to vary with the number of direct labor hours actually used. | During October 2013, 800 transformers were produced. This was below expectations because a work stoppage | occurred during contract negotiations with the labor force. Once the contract was settled, the department | | scheduled overtime in an attempt to catch up to expected production levels. | Actual costs incurred in October 2013 were as follows: Direct materials: Purchased Iron 5,000 sheets @ P 2 per sheet i Copper 2,200 spools @ P 3.10 Direct labor: Regular time 2,000 hours @ P 7.00 | 1,400 hours @ P 7.20 Overtime 600 of the 1,400 hours were subject to overtime premium. The total overtime premium of P 2,160 | is included in variable overhead in | accordance with corporate accounting practices Variable overhead P 40,000 | Fixed overhead P 8,800 Determine the following: | 1. The material spending variance for Copper je ll. The variable overhead efficiency variance, ‘A. PGOOUF; P2000UF B. P220UF; P600UF C. P220UF; P2000UF D. P6OOUF; P2000F 1. Both are mandatory. \ Il, Both rely on the same underlying financial data. | Ii, Both emphasize the segments of an organization, rather | organization as a whole. IV. Both are geared to the future, rather than to the past. financial and managerial accounting? than just looking at the Used 3,900 sheets 2,600 spools (eV|The following events took piace when Manager and G were preparing budges for the upcoming peri |. Manager A increased property tax expenditures by 2% when she was inforned of a recent rate hike by local authorities, ll, Manager B reduced sales revenues by 4% when informed of recent aggresive actions by anew | competitor. Ill Manager C, who supervises employees with widely varying skill levels, usedthe highest wage rate in ' the department when preparing the labor budget. | Assuming that the percentage amounts given are reasonable, which of the preceding cases is (are) example/s | of building slack in budgets? PoAd © i Bt 'D. None of the Above times, cost of equity of 10% and WACC of 10%. | Assuming a tax rate of 20%, what is the effective interest rate of the debt financing? | | | i | | | | j | the Assembly Division. The Sole Division manufactures soles and then ‘sells" them to the Assembly ich completes the shoes and sells them to 8. The market price for the Assembly | | | Division to purchase a pair of soles is ®20. Fixed cosfs pair at 100,000 units. | Pere | Sole’s costs per pair of soles are: Tle 199, 999 | | Direct materials 4 | Direct labor 3 Ute ET | | Variable overhead 2 | Division fixed costs 1 | | Assembly's costs per completed pair of shoes are: ox | Direct materials PS De | | Direct labor 1 | | Variable overhead 1 | Division fixed costs 9 | Assume the transfer price for a pair of soles is 180% of full costs of the Sole Division and 125,000 of | Soles are produced and transferred to the Assembly Division. The Sole Division's operating income is: