# FINANCE

Exercise 12-21 (Algorithmic)

Park Company provided the following income statement for last year:

 Sales \$70,000 Less: Variable expenses 56,000 Contribution margin \$14,000 Less: Fixed expenses 19,200 Operating income \$-5,200

At the beginning of last year, Park had \$38,650 in operating assets. At the end of the year, Park had \$41,350 in operating assets.

Compute ROI. Do not round interim calculations, but do round your final answer to two decimal places. If required, use a minus sign to indicate a negative ROI.

ROI =   _________________   %

5.
eBookeBookeBookeBookExercise 12-22
Return on Investment, Margin, Turnover

Links to learning objectives referenced by this question can be accessed in the “Additional Resources” drop-down menu above.

Data follow for the Construction Division of D. Jack Inc.:

Round all answers to two decimal places.

1.  Compute the margin (as a percent) and turnover ratios for each year.

 Year 1 Year 2 Margin: _________________   % _________________   % Turnover: _________________ _________________

2.  Compute the ROI as a percent for the Construction Division for each year.

 ROI year 1 _________________   % ROI year 2 _________________   %

The first budget to be prepared when making a master budget is the

a.
 sales budget.
b.
 production budget.
c.
 cash budget.
d.
 direct labor budget.

1 points

Question 2

1.

J.         J. Johnson has decided to supplement his income by selling beehives. He expects to sell 25,000 hives in 2010. He ended 2009 with 2,500 completed hives in inventory and would like to complete operations in 2010 with at least 2,800 completed hives in inventory. There is no ending work in process inventory. One beehive holds about 250 bees. The bees are purchased for \$4.00 per 1,000 bees. The hives sell for \$15.00 each.

How many beehives would the 2010 production budget identify as needing to be produced?

a.
 24,700
b.
 25,000
c.
 25,300
d.
 30,300

1 points

Question 3

1.

J.        J. Johnson has decided to supplement his income by selling beehives. He expects to sell 25,000 hives in 2010. He ended 2009 with 2,500 completed hives in inventory and would like to complete operations in 2010 with at least 2,800 completed hives in inventory. There is no ending work in process inventory. One beehive holds about 250 bees. The bees are purchased for \$4.00 per 1,000 bees. The hives sell for \$15.00 each.

What would be the total of the 2010 period sales budget?

a.
 \$375,000
b.
 \$376,500
c.
 \$378,000
d.
 \$379,500

1 points

Question 4

1.

Fantastic Futons goes through two departments in the production process. Each futon requires two direct labor hours in Department A and one hour in Department B. Labor cost is \$8 per hour in Department A and \$10 per hour in Department B.

Assuming the amount budgeted to be produced in January is 30,000 units, what is the budgeted direct labor cost for January?

a.
 \$540,000
b.
 \$780,000
c.
 \$810,000
d.
 \$840,000

1 points

Question 5

1.

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