IMANET IMANET Certifications IMANET-CMA Questions & Answers

• Question 371:

  Exhibit The variance of actual contribution margin from budgeted contribution attributable to unit variable cost changes is?

  

  A. $165,000 favorite

  B. $137,000 favorable

  C. $137,000 unfavorable

  D. Zero, because actual wit variable costs were the same as budgeted unit variable costs

  Correct Answer: D

  The proper procedure is to calculate variable costs by multiplying actual units sold by the budgeted costs per unit. The budgeted costs of Xenox and Xeon were $3 and $7 50, respectively the actual costs (130 x $3 = $390 and 130 x $750 = $975) were identical to budgeted variable costs at the actual volume. Thus, the variance was zero

• Question 372:

  Exhibit The variance of actual contribution margin from budgeted contribution margin attributable to sales price is?

  

  A. $115,000 unfaorable.

  B. $115,000 favorable

  C. S65.000 favorable.

  D. $65,000 uravorebIe.

  Correct Answer: D

  The budgeted prices of Xenox and Xeon were $6 and $10 per unit, respective. Actual sales in units multiplied by the budgeted prices equals total sales of $2,080,000, Because actual sales were on, p $2.0 15,000. the variance of $65,000 is unfavorable (lower sales than budgeted).

• Question 373:

  Exhibit The budgeted total volume of 250,000 units s based upon Xerbert's aching a market share of 10%. Actual industry volume was 2.580.000 units. Xerbert's increased volume owing to improved market share is

  

  A. 100%

  B. 80%

  C. 20%

  D. 4%

  Correct Answer: C

  Based on the revised industry volume. Herbert should have sold 258,000 units (2.580,000 x 10%). Because 260,000 were actually sold, the company increased its market share by 2,000, or 20% of the 10,000 (260,000 -- 250,000) increase.

• Question 374:

  Exhibit

  

  The percentage difference between the actual and the budgeted breakeven point in units was that actual was

  A. 500% above budget

  B. 6.67% below budget.

  C. 6.67% above budget

  D. 5.00% below budget.

  Correct Answer: A

• Question 375:

  Pontotoc industries manufactures a product that is used as a subcomponent by other manufacturers It has the following price and cost structure

  

  During the next year, sales are expected to be 10.000 units all costs will remain the same except for fixed manufacturing overhead, which will increase 20%. and direct materials. which will increase 10%. The selling price per unit for next year will be $320. Based on this information, Pontotoc's contribution margin for next year will be

  A. $1,240,000

  B. $1,360,000

  C. $2,160,000

  D. $2,200,000

  Correct Answer: C

  Contribution margin is the excess of sales over variable costs. Sales of 10,000 units at $320 each will produce total revenue of $3,200,000. Variable costs will be $104 per Unit, consisting of $44 for direct maternal, $30 for direct labor. $24 for variable overhead, and $6 for selling costs. At $104 per unit, the 10,000 units will have total variable costs of $1,040,000, resulting in a contribution margin of $2,160,000 ($3,200,000 -- $1,040,000).

• Question 376:

  Pontotoc Industries manufactures a product that is used as a subcomponent by other manufacturers. It has the following price and cost structure; What will the contribution margin per unit be if the company sells 10,000 units?

  

  A. $206

  B. $200

  C. $140

  D. $120

  Correct Answer: B

  Contribution margin is the excess of sales over variable costs Sales will be at $300 per unit. Variable costs

  are $100. consisting of $40 of direct materials, $30 of direct labor, $24 of variable overhead. and $6 of

  variable selling costs. Thus, the contribution .

  margin will be $200 per unit ($300 --$100)

• Question 377:

  Based on potential sales of 1.000 units per year, a new product has estimated mated costs of $600.000. Vat is the target price to obtain a 20% return on sales?

  A. $720

  B. $750

  C. $1080

  D. $3,000

  Correct Answer: B

  It the company wants a 20% return on sales, the $600,000 of costs represent 80% of the 1selling price. Dividing $600,000 by .8 results in a total selling price of $750,000, or $750 per un.

• Question 378:

  A company wants to open a new store in one of three nearby shopping malls. In Mall A. the rent will be $300,000 per year. In Mall B, the rent will be 4% of gross revenues In Man C, rent will be $150,000 per year plus 3% of gross revenues. Assume that revenues and all other elements under consideration are the same for all three malls. What is the maximum level of revenues at which Mall C will be the most desirable of the three options?

  A. $149,999

  B. $5,000,000

  C. $15,000,000

  D. Man C will never be the most desirable choice.

  Correct Answer: D

• Question 379:

  company wants to open a new store in one of three nearby shopping malls. In Mall A, the rent will be $300,000 per year. In 4alI B, the rent will be 4% of gross revenues. In Mall C, the rent will be $150,000 per year pIus 3% of gross revenues Assume hat revenues and all other elements under consideration are the same for all three malls. If the company expects revenues to be $ 10.000.000 per year. which mall should be chosen?

  A. Mall A,

  B. MaII B.

  C. Mall C.

  D. The company will be indifferent between two of the choices.

  Correct Answer: C

  It the company expects revenues to be $10,000,000 per year. the calculation is as follows. Mall A. $300.000 Mall B: $10,000,000 x 4% = $400,000 Mall C: $10,000.000 x 3% $300,000 + $150.000 $450,000 Thus, Mall A is preferable

• Question 380:

  A company wants to open a new store in one of three nearby shopping malls. In Mall A. the rent will be $300,000 per year. In Mall B. the rent will be 4% of gross revenues In Mall C. the rent will be $150,000 per year pius 3% of gross revenues. Assume that revenues and and other elements under consideration are the same for all three malls. Which mall should the company choose it revenues are expected to be $6,000,000 per year?

  A. MaII A.

  B. MaII B.

  C. Mall C.

  D. The company will be indifferent between two of the Choices.

  Correct Answer: C

  The answer depends on the expected level of revenues. If the company expects revenues to be $6,000,000 per year, the calculation is as follows: Mall A: $300.000 Mall B $6,000,000 x 4% = $240,000 1Mall C: $6,000,000 x 3% $180000 + $150,000 $330.000 Thus, Mall B is preferable