Acco 420

First Question:
A- The following information concerns operations for each quarter in year 2020:
1st quarter sales are 6000 units, 2nd quarter sales are 7000 units, 3rd quarter sales are 8000
units and 4th quarter sales are 9000 unit, The company desires an ending finished goods
inventory at the end of each quarter equal to 30% of the budgeted unit sales for the next
quarter. Assume that the desired ending inventory for quarter four is 2500 unit. Prepare the
production budget for the four quarters and choose the best answer of the following:
1. Production in units for the 1st quarter:
(a) 7700 units (b) 6300 units (c) 9700 units (d) None of the above
2. Production in units for the 2nd quarter:
(a) 8900 units (b) 8300 units (c) 7300 units (d) None of the above
3. Production in units for the 3rd quarter:
(a) 8300 units (b) 11700 units (c) 8800 units (d) None of the above

B- XYZ Corporation manufactures and sells a seasonal product that has peak sales in the
third quarter. The following information concerns operations for the year 2019:
• The company’s single product sells for $30 per unit. Budgeted sales in units for the year
four quarters are as follows (all sales are on credit): 1st quarter sales are 5000 units, 2nd
quarter sales are 15000 units, 3rd quarter sales are 20000 units and 4th quarter sales are
10000 unit.
• Sales are collected in the following pattern: 60% in the quarter the sales are made, and
the remaining 40% in the following quarter (noting that on January 1, 2019, the
company’s balance sheet showed $45,000 in accounts receivable, all of which will be
collected on the first quarter of the year. Prepare Sales budget and expected cash
collections budget and choose the best answer of the following:
4- Total cash collection for the 1st quarter:
(a) L.E 150000 (b) L.E 45000 (c) L.E 135000 (d) None of the above
5- Total cash collection for the 2nd quarter:

Page 1 of 3
 (a) L.E 330000 (b) L.E 270000 (c) L.E 135000 (d) None of the above
6- Total cash collection for the 4th quarter:
(a) L.E 300000 (b) L.E 420000 (c) L.E 540000 (d) None of the above
Second Question:
A- A company has $100,000 in fixed costs per month, and their product has an average
selling price of $100, and the variable cost is $20 per produced unit.
7. Break-even point in units equal:
(a) 1000 unit (b) 1250 unit (c) 5000 unit (d) None of the above
8. contribution margin ratio % equal:
(a) 20% (b) 80% (c) 60 % (d) None of the above
9. units must be sold to achieve target profit of 60000 L.E. per month equal:
(a) 2000 unit (b) 8000 unit (c) 1600 unit (d) None of the above
10. if you learn that the budgeted sales were 3000 unit, margin of safety in units equal:
(a) 2000 unit (b) 1750 unit (c) 2000 unit (d) None of the above

B-Answer the questions from 11 to 20 using this information:

The Egyptian Co. produces and sells product (X). in December 2020 it manufactured 2000
units but sold 1600 units, data for Dec. were:
- Direct material cost per unit 20$
- Direct labor cost per unit 5$
- Factory power per unit 2$
- Factory maintenance costs for the month (the cost function is y =3000 +2X) where x =units
produced 7000$
- Other fixed factory overhead costs for the month 25000$
- Marketing & administrative costs for the month (the cost function is y=15000 +5%X) where x=sales
revenues 24600$
- Selling price per unit 120 $
- No beginning inventory on December 1

11- using absorption costing, what is the product cost per unit?
A- 45 b- 43 c- 47 d- 50
12- using absorption costing, what is the cost of goods manufactured ?
A- 86000 b- 68800 c- 98600 d- 100000
13- using absorption costing, what is the product cost per unit?
A- 86000 b- 68800 c- 98600 d- 90000
Page 2 of 3
14- using absorption costing, what is the Gross margin ?
A- 192000 b- 68600 c- 98600 d- 123200
15- using absorption costing, what is the operating income ?
A- 198600 b- 123200 c- 90000 d- 98600
16- using absorption costing, what is the cost of ending finished goods inventory?
A- 17200 b- 24600 c- 11600 d- 20000
17- using variable costing, what is the product cost per unit?
A- 29 b- 43 c- 31 d- 45
18- using variable costing, what is the cost of goods manufactured ?
A- 46400 b- 58000 c- 56000 d- 43000
19- using variable costing, what is the contribution margin ?
A- 158400 b- 156000 c- 136000 d- 192000
20- using variable costing, how much the operating income?
A- 100000 b- 970000 c- 93000 d- 102000

(Good luck)

Page 3 of 3