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A company’s cash budgetary plans show that there will be surplus cash for three months of
the forthcoming year.
Which THREE of the following would be appropriate management actions in this situation?
A. Offer a longer credit period to new customers to boost sales
B. Purchase new non-current assets to increase efficiency
C. Reduce the finished goods inventory to save storage costs
D. Pay suppliers early to obtain prompt payment discounts
E. Repay a long-term loan to reduce interest costs
F. Invest in a short-term deposit account
ANSWER : A,D,F
In an integrated cost and financial accounting system, the accounting entries for the
payment of net wages to indirect production workers would be:
A. Debit: Bank accountCredit: Wages control account
B. Debit: Work in progress control accountCredit: Bank account
C. Debit: Wages control accountCredit: Bank account
D. Debit: Production overhead control accountCredit: Bank account
ANSWER : C
A company uses an integrated accounting system. The accounting entries for the sale of goods on credit would bE.
A. Debit: Receivables control accountCredit: Sales account
B. Debit: Sales accountCredit: Finished Goods Control account
C. Debit: Receivables control accountCredit: Cost of sales account
D. Debit: Sales accountCredit: Receivables control account
ANSWER : A
The materials price variance will be adverse when:
A. The actual cost of the materials is more than the standard material cost for the output produced
B. The actual cost of the materials purchased is more than the standard cost of the materials purchased
C. The materials usage variance is favourable
D. The price of materials has fallen
ANSWER : B
CVP Limited manufactures a single product with a selling price of $25.60. Fixed costs are $122,880 per month and the product has a profit/volume ratio of 40%. In a month when actual sales were $358,400, CVP's margin of safety in units was
ANSWER : .