Accounting II - Unit 6 Practice Test

Fresh Food Market had an increase in net sales of 18.9%. Advertising expense increased by 9.3%. Which of the following is correct about the change in advertising expense?

John wants to prepare reports that show estimates of income and expenses for the upcoming year. Which report would reflect estimates for rent expense?

Slugger Apparel had an increase in net sales of 7.9%. Cost of merchandise sold increased by 13.4%. Which of the following is correct about the change in cost of merchandise sold?

Mary wants to prepare reports that show estimates of income and expenses for the upcoming year. Which report would Mary need to complete FIRST?

Bill's Beverage has an increase in net sales of 9.3%. Rent expense increased by 7.5%. Which of the following is correct about the change in rent expense?

Friendly Shoe Store projected cash of $5,000 for the period. Actual cash was $4,000. Which of the following could be the cause of the decrease in cash?

Michelle wants to know her company's anticipated cash outflows for the upcoming year. Which schedule would give Michelle this information?

Jane wants to compare actual income and expenses to budgeted income and expenses. Which of the following would provide the information Jane needs?

Tennis Town had an increase in net sales of 8.2%. Cost of merchandise sold increased by 13.4%. Which of the following is correct about the change in cost of merchandise sold?

Tucker Manufacturing has total fixed costs of $125,000.00 and a contribution margin rate of 40%. The unit sale price is $125.00. How many units must be sold to break-even?

Wild Bill's Theme Park has total fixed costs $150,000.00 and a contribution margin rate of 25%. The unit sale price is $75.00. How many units must be sold to break-even?

Linda's Cosmetics has total fixed costs of $10,000.00. Units sell for $20.00 and have a variable cost of $15.00. To earn a planned net income of $8,000.00, how many units must be sold?

Carson Ski Shoppe is considering expanding its product line to include snowboards. Management projects that the snowboards would sell for $500.00 each. Variable costs are projected to be $100.00 per unit, with total fixed costs of $50,000.00 per month. How many units need to be sold each month to break-even?

Off Shore Boats sells water skis and jet skis. Their net sales are $400,000.00 (water skis= $320,000.00; jet skis= $80,000.00). Their contribution margin is $100,000.00 and total fixed costs are $50,000.00. Off Shore would like to improve its net income to $75,000.00. If the water skis sell for $1,000 each and the jet skis sell for $2,500 each, how many water skis and jet skis should they plan to purchase and sell?

Cooper's Gym has total fixed costs of $15,000.00. The unit sales at break-even point are 3,000. The unit sales price is $15.00. What is the contribution margin per unit?

Garrett's Gourmet Ice Creams ells ice cream and milkshakes. Garrett's net sales are $5,000.00 (Ice Cream=$3,000.00; Milkshakes=$2,000.00). Its contribution margin is $2,000.00, and total fixed costs are $2,500.00. Garrett would like to improve its net income to $700.00. If the ice cream sells for $6 each and the milkshakes sell for $4 each, how many ice creams and milkshakes should Garrett plan to purchase and sell?

David's Hair Products is considering expanding its product line to include hair dryers. Management projects that the hair dryers would sell for $30.00 each. Variable costs are projected to be $18.00 per unit, with total fixed costs $3,600.00 per month. If potential sales for the hair dryers are projected to be 150 units per month, should they expand its production line?

Green Fees Golf Store has total fixed costs of $12,000.00 and planned net income of $15,000.00. How many sales dollars are required to achieve a 20% contribution margin rate?

Michel's Craft Store has total fixed costs of $12,000.00 and planned net income of $8,000.00. How many sales dollars are required to achieve a 25% contribution margin rate?

Water Fun Park had total fixed costs of $75,000.00 and a contribution margin rate of 20%. The unit sale price is $75.00. How many units must be sold to break-even?

Russell Tie Shop has total fixed costs of $8,000.00. Units sell for $30.00 and have a variable cost of $10.00. To earn a planned net income of $10,000.00, how many units must be sold?

Carson Ski Shopped is considering expanding its product line to include snowboards. Management projects that the snowboards would sell for $500.00 each. Variable costs are projected to be $100.00 per unit, with total fixed costs of $50,000.00 per month. If potential sales for the snowboards are projected to be 100 units per month, should they expand its production line?

Garrett's Gourmet Ice Cream has total fixed costs of $9,000.00 and planned net income of $6,000.00. How many sales dollars are required to achieve a 15% contribution margin rate?

David's Hair Products is considering expanding its product line to include hair dryers. Management projects that the hair dryers would sell for $30.00 each. Variable costs are projected to be $18.00 per unit, with total fixed costs of $3,600.00 per month. How many units need to be sold each month to break-even?

Ryan Sporting Goods has total fixed costs of $36,000.00 and a contribution margin rate of 20%. The unit sale price is $9.00. How many units must be sold to break-even?

Cooper Electronics sells televisions and DVD players. Cooper's net sales are $75,000.00 (TVs=$52,500.00; DVD players=$22,500.00). Its contribution margin is $30,000.00, and total fixed costs are $24,000.00. Cooper would like to improve its net income to $10,000.00. If the televisions sell for $350 each and the DVD players sell for $250 each, how many televisions and DVD player should Cooper plan to purchase and sell?

Budget Motorsports is considering expanding its product line to include motorcycles. Management projects that the motorcycles would sell for $10,000.00 each. Variable costs are projected to be $6,000.00 per unit, with total fixed costs of $200,000 per month. How many units need to be sold each month to break-even?

Budget Motorsports is considering expanding its product line to include motorcycles. Management projects that the motorcycles would sell for $10,000.00 each. Variable costs are projected to be $6,000.00 per unit, with total fixed costs of $200,000.00 per month. If potential sales for the motorcycles are projected to be 80 units per month, should they expand its production line?