题目

The following question is taken from the June 2013 exam paper.A project has an initial outflow of $12,000 followed by six equal annual cash inflows, commencing in oneyear’s time. The payback period is exactly four years. Thec ost of capital is 12% per year.What is the project’s net present value (to the nearest $)?

A

$333

B

-$2,899

C

-$3,778

D

-$5,926

Chapter19Methodsofprojectappraisal

The correct answer is A.A four year payback period implies an (equal) annual cash flow of $12,000 + 4 years = $3,000 per year. As these cash flows run for 6 years the NPV is equal to $333 ( -$12,000 + annuity factor for 6 years @ 12% x $3,000 = -$12,000 + 4.111 x $3,000 = $333). Alternative C is based upon an incorrect calculation of annual cash flow ($12,000 + 6 years = $2,000 per year), suggesting a misunderstanding of the payback method.In alternative B the NPV was based on a project life of 4 years rather than 6 suggesting a failure to read the question carefully.Finally alternative D's NPV was based upon a combination of the other two distracters, that is, an annual cash flow of $2,000 for 4 years.

多做几道

A company uses a standard absorption costing system. Last month budgeted production was 8,000 units and the standard fixed production overhead cost was $15 per unit. Actual production last month was 8,500 units and the actual fixed production overhead cost was $17 per unit.What was the total adverse fixed production overhead variance for last month?

A

$7,500

B

$16,000

C

$17,000

D

$24.500

A cost centre had an overhead absorption rate of $4.25 per machine hour, based on a budgeted activity level of 12,400 machine hours.In the period covered by the budget, actual machine hours worked were 2% more than the budgeted hours and the actual overhead expenditure incurred in the cost centre was $56,389.What was the total over or under absorption of overheads in the cost centre for the period?

A

$1,054 over absorbed

B

$2,635 under absorbed

C

$3,689 over absorbed

D

$3,689 under absorbed

Which of the following would help to explain a favourable direct labour efficiency variance?

(i) Employees were of a lower skill level than specified in the standard

(ii) Better quality material was easier to process

(iii) Suggestions for improved working methods were implemented during the period

A

(i), (ii) and (iii)

B

(i) and (ii) only

C

(ii) and (iii) only

D

(i) and(II) only

Which of the following statements is correct?

A

An adverse direct material cost variance will always be a combination of an adverse material price variance and an adverse material usage variance

B

An adverse direct material cost variance will always be a combination of an adverse material price variance and a favourable material usage variance

C

An adverse direct material cost variance can be a combination of a favourable material price variance and a favourable material usage variance

D

An adverse direct material cost variance can be a combination of a favourable material price variance and an adverse material usage variance

The following information relates to labour costs for the past month:

Budget                 Labour rate                      $10 per hour

                            Production time                15,000 hours

                           Time per unit                     3 hours

                           Production units                5,000 units 

Actual                Wages paid                       $176,000

                          Production                         5,500 units 

                        Total hours worked             14,000 hours

There was no idle time.

What were the labour rate and efficiency variances? 

A

Rate variance                 Efficiency variance

$26,000 Adverse           $25,000 Favourable

B

Rate variance                 Efficiency variance

 $26,000 Adverse           $10,000 Favourable

C

Rate variance                 Efficiency variance

 $36,000 Adverse           $2,500 Favourable

D

Rate variance                 Efficiency variance

 $36,000 Adverse           $25,000 Favourable

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