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COMPILED BY: PATRICK

WITH THE SUPPORT OF BELOVED FRIENDS FROM WORLD WAR ACCOUNTANT’S
AUTHOR OF LAZY NOTE
MAKER OF CENTURY EGG
THIS CENTURY EGG IS DEDICATED TO MY BESTFRIEND TO CARL VINCENT N. TALAROK
WHO FOUGHT FOR THIS BATTLE FOR THE 8TH TIME BUT NEVER GIVEN THE CHANCE TO
PROVED HIS WORTH. REST IN PEACE YAWA!

ACTUAL MAS QUESTIONNAIRES OCTOBER 2021 TO DECEMBER 2021:

1. Starbucks Corporation experiments with adding ice cream sundaes to its

menu at several stores. One of its stores is in Bonifacio Global.
Financial reports are prepared showing revenues and costs for in each new
menu item. Based on in which reports, management at in which corporate
office will decide which to permanently add or remove in the new menu
item. Financial report is an example of information.
a) scorekeeping c) problem-solving
b) attention directing d) management auditing
2. Which of the following statements about step costs is FALSE?
A) If the individual chunks of cost are relatively large and apply to a specific,
broad range of activity, the step cost is considered to be a fixed cost over that
range of activity.
B) When individual chunks of cost are relatively small and apply to a narrow
range of activity, step costs are considered to be variable costs.
C) Some step costs can be assumed to be variable costs for planning purposes with
little loss of accuracy.
D) Step costs are the same as mixed costs.
3.Mcgrady Company prepared the following absorption-costing income
statement for the year ended May 31, 2024.
Sales (16,000 units) P320,000
Cost of goodssold 216,000
Gross margin P104,000
Selling and administrative exp 46,000
Operating income P58,000

Additional information follows:

Selling and administrative expenses include P1.50 of variable cost per

unit sold. There was no beginning inventory, and 17,500 units were
produced. Variable manufacturing costs were $11 per unit. Actual fixed
costs were equal to budgeted fixed costs.

How much is the operating income using variable costing?

A) P54,520 C) P54,250
B) P45,250 D) P45,520

SITUATION 1

Following a strategy of product differentiation, Mourinho Corporation makes a

high-end smart phone, CR7, that is superior and unique from competition. Mourinho
Corporation believes that putting additional resources into R&D and staying ahead
of the competition with technological innovations are critical to implementing
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its strategy. Mourinho Corporation presents the following data for the years
2020 and 2021:

2020 2021
Units of CR7 produced and sold 5,000 5,500
Selling price P400 P440
Direct materials (pounds) 15,000 15,375
Direct materials costs per pound P40 P44
Manufacturing capacity for CR7 (units) 10,000 10,000
Conversion costs P1,000,000 P1,100,000
Conversion costs per unit of capacity P100 P110
Selling and customer-service capacity (customers) 60 58
Total selling and customer-service costs P360,000 P362,500
Selling and customer-service capacity cost per customer P6,000 P6,250

4. What is the cost effect of the price-recovery component?

A)140,000F C) 140,000U
B)220,000F D) 66,000U

5. What is the net effect on operating income as a result of the price-

recovery component?
A)220,000F C)140,000U
B)39,000F D) 49,500U

6.What is the net effect on operating income as a result of the

productivity component?
A)12,500F C) 62,000F
B)49,500F D) 39,000F

7.WHAT IS THE NET EFFECT ON THE OPERATING INCOME AS A RESULT OF THE PRODUCTIVITY
COMPONENTS?
ANSWER :
PLEASE SEE ATTACHED FILE NAMED “MOJOAKOE” INDONESIAN ACCOUNTING TO GUYS HAHAHHA
NAHILO AKO KAKASOLVE SA LAHAT NG TOPIC NITO INDONESIAN SITE FOR 2 DAYS STRAIGHT

SITUATION 2

Suppose that the market portfolio is equally likely to increase by 24% or

decrease by 8%. Security "X" goes up on average by 29% when the market
goes up and goes down by 11% when the market goes down. Security "Y" goes
down on average by 16% when the market goes up and goes up by 16% when
the market goes down. Security "Z" goes up on average by 4% when the
market goes up and goes up by 4% when the market goes down.

8.The beta for security "X" is closest to:

A) 0 C) 1.00
B) 0.80 D) 1.25

9. The beta for security "Y" is closest to:

A) -1.00 C) 0.00
B) -0.25 D) 0.25

10. The beta for security "Z" is closest to:

A) -1.00 C) 0.00
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B) -0.25 D) 0.25

SITUATION 3

Johnson Realty bought a 2,000-acre island for P10,000,000 and divided it

into 200 equal size lots. As the lots are sold, they are cleared at an
average cost of P5,000. Storm drains and driveways are installed at an
average cost of P8,000 per site. Sales commissions are 10 % of selling
price. Administrative costs are P850,000 per year. The average selling
price was P160,000 per lot during 2022 when 50 lots were sold.

During 2023, the company bought another 2,000-acre island and

developed it exactly the same way. Lot sales in 2023 totaled 300 with an
average selling price of P160,000. All costs were the same as in 2022.

11. How much is the cost per site using absorption and variable costing?
A) 55,000; 5,000 C) 63,000; 13,000
B) 63,000; 8,000 D) 58,000; 8,000
11. Operating income to be reported in 2023 using absorption costing
is .
A) P3,200,000 C) P23,450,000
B) P(4,300,000) D) P28,450,000

12. Operating income to be reported in 2022 using variable costing

is .
A) P3,200,000 C) P23,450,000
B) P(4,300,000) D) P28,450,000

SITUATION 4

Ruben intends to sell his customers a special round-trip airline ticket

package. He is able to purchase the package from the airline carrier for
P150 each. The round-trip tickets will be sold for P200 each and the
airline intends to reimburse Ruben for any unsold ticket packages. Fixed
costs include P5,000 in advertising costs.

13) How many ticket packages will Ruben need to sell to break even?
A) 34 packages
B) 50 packages
C) 100 packages
D) 150 packages

14)How many ticket packages will Ruben need to sell in order to achieve
P60,000 of operating income?
A) 367 packages
B) 434 packages
C) 1,100 packages
D) 1,300 packages

15) For every P25,000 of ticket packages sold, operating income will
increase by:
A) P6,250
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B) P12,500
C) P18,750
D) an indeterminable amount

SITUATION 5

Doug's Custom Construction Company is considering three new projects,

each requiring an equipment investment of P26,410. Each project will last
for 3 years and produce the following net annual cash flows.

Year AA BB CC

1 P11,259 P14,665 P18,209

2 14,456 14,665 14,039
3 20,989 14,665 15,429
Total P46,704 P43,995 P47,677
The equipment's salvage value is zero, and Doug uses straight-line
depreciation. Doug will not accept any project with a cash payback period
over 2 years. Doug's required rate of return is 12%.
16. What is the payback period of project AA?
A) 2.03 years C)1.59 years
B) 1.8 years D)1.6 years

17. What is the payback period of project BB?

A) 2.03 years C)1.59 years
B) 1.8 years D)1.6 years

18. What is the payback period of project CC?

A) 2.03 years C)1.59 years
B) 1.8 years D)1.6 years

SITUATION 6

Pfizer Company applies the high-low method of cost estimation to customer

order data for the first 5 months of 2021:
Month Orders Cost
January 1,200 3,120
February 1,300 3,185
March 7,300 14,320
April 1,800 4,320
May 1,700 3,895
19. What is the estimated slope of the line per order?
a. P 2.00 c. P 1.83
b. P 2.20 d. P 1.84
20. What is the estimated Y-intercept per order?
a. P720 c. P961
b. P888 d. P495
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21. Compute the dependent variable at 1,650orders?

a. P4,020 c. P3,980.5
b. P4,518 d. P3,756

SITUATION 7

22. What is the Acid Test Ratio?

a. 1.78 c. 1.98
b. 2.89 d. 1.87

23. What is the Current Ratio?

a. 2.89 c. 1.87
b. 1.78 d. 1.98

24. What is the Debt to Equity Ratio?

a.0.09 c. 1.44
b.1.04 d. 1.08

25. Overland Corporation has gathered the following data on a proposed

investment project:

Investment required in equipment P150,000

Annual cash inflow P40,000

Salvage value of equipment P0
Life of the investment 10 years
Required rate of return 10%
The company uses straight-line depreciation on all equipment. Assume cash
flows occur uniformly throughout a year except for the initial
investment.
The payback period for the investment is:
A) 0.27 years
B) 3.75 years
C) 10.00 years
D) 2.13 years
26. A company identifies the following goals and objectives:
Increase sales 10% each year.
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Increase profits 5% each year.

Increase total plant assets 5% each year.
Which of the following budgets identifies the overall goals and
objectives of an organization?
A) strategic plan C) sales budget
B) financial planning model D) master budget

27. In what circumstances is an economy said to be in recession?

A. If real GDP falls in one quarter compared with the quarter before.
B. If real GDP falls for two consecutive quarters.
C. If real GDP falls in one year compared with the year before.
D. If real GDP falls for two consecutive years.

28. Punuan ang mga patlang.

Ako, si , ng

ay taimtim na nanunumpa na (1) ko at (2) ang Saligang Batas ng

Pilipinas, na ako ay tunay na (3) at (4) rito; na (5) ko
ang mga batas, mga utos na legal, at mga atas na ipinahayag ng mga
sadyang itinakdang may kapangyarihan ng Republika ng Pilipinas; at kusa
kong (6) ang pananagutang ito, na walang ano mang (7) o
(8) umiwas.

Ano ang dapat nasa patlang 1 at 4?

A) ipagtatanggol; itataguyod
B) mananalig; susundin
C)susundin; itataguyod
D)itataguyod; tatalima

ADDITIONAL QUESTIONS IN ECONOMICS:

29. Which type of economic market structure is composed of a large number of

sellers, each producing an identical product, and with no significant barriers to
entry and exit?
a. Monopoly. b. Oligopoly.
c. Perfect competition d. Monopolistic competition.

30. The distinguishing characteristic of oligopolistic markets is

a. A single seller of a homogeneous product with no close substitutes.
b. A single seller of a heterogeneous product with no close substitutes.
c. Lack of entry and exit barriers in the industry.
d. Mutual interdependence of firm pricing and output decisions.

31. Which type of economic market structure is characterized by a few

large sellers of a product or service, engaging primarily in nonprice
competition?
a. Monopoly. b. Oligopoly.
c. Perfect competition. d. Monopolistic competition.
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32.
ANSWER:B

60. A 33
61. C

34.
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35.When using the statement of cash flows to evaluate a company’s

continuing solvency, the most important factor to consider is the cash
a. balance at the end of the period.
b. flows from (used for) operating activities.
c.flows from (used for) investing activities.

d. flows from (used for) financing activities.

Correct answer B. A company’s solvency is best represented by the amount

of cash that can be generated internally rather than having to borrow
from outside sources. This is shown on the Cash Flow Statement as flows
from operating activities.

36. After leading the market for the past decade, the growth of product
ABC is slowing down. In this stage of its life cycle, the product is
still generating significant amounts of cash flows that cover the
company’s investment into new product innovations. According to the BCG
Growth-Share Matrix, product ABC is most likely an example of a

A. star.
B. cash cow.
C. question mark.
D. dog.

Correct answer B. Product ABC is an example of a cash cow. It is a high-

market share (dominating the market for the past decade) but low growth
(continuously slowing down) product. It also generates a huge amount of
cash flows.

37. A company has a direct labor price variance that is favorable. Of the
following, the most serious concern the company may have about this
variance is that

A. the circumstances giving rise to the favorable variance will not

continue in the future.

B. the production manager may not be using human resources as

efficiently as possible.

C. the cause of the favorable variance may result in other larger

unfavorable variances in the value-chain.

D. actual production is less than budgeted production.

Correct answer C. A favorable direct labor price variance could indicate

that lower-skilled labor is being used than what was planned. This could
lead to unfavorable labor use and material usage variances that more than
offset the favorable price variance.
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38. A public company’s shareholders expect to receive a dividend one year

from now of $20 per share. Immediately after the dividend payout,
analysts are expecting that the stock will trade at $244 per share. If
the investors have a required rate of return of 20%, what is the current
value of the stock?

A. $220.

B. $224.

C. $244.

D. $264.

Correct answer A
Current price = (Expected future price + Next dividend)/(1+required rate
of return)
Current price = ($244+20)/(1+0.2)=$264/1.2=$220

39. A detergent company sells large containers of industrial cleaner at a

selling price of $12 per container. Each container of cleaner requires
$4.50 of direct materials, $2.50 direct labor, and $1.00 of variable
overhead. The company has total fixed costs of $2,000,000 and an income
tax rate of 40%. Management has set a goal to achieve a targeted after-
tax net income of $2,400,000. What amount of dollar sales must the
company achieve in order to meet its goal?

A. $14,400,000.

B. $18,000,000.

C. $22,000,000.

D. $24,000,000.

Correct answer B.
b. Volume to reach targeted net income =
[fixed costs + (target after tax income / (1 – tax rate))] / unit
contribution margin
unit contribution margin = price – variable costs
Volume to reach targeted net income =
[$2,000,000 + ($2,400,000 / (1 – 0.40))] / ($12 - $4.50 - $2.50 - $1.00)
= 1,500,000 containers
1,500,000 containers * $12 per container = $18,000,000 of dollar sales to
reach targeted net income

40.
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#49
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#5

#51-52

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#54
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#55

D #56
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#57

#D
DA

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#58-59

#60-
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#60- (ITEM NUMBER 4 ONY)

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#61 #62

#63 #64

ANSWER KEY #64

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#65

#66

A .....

XX
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#67

#68 EXPERIENCE CURVE

#69 -70
RISK RETURN THEORIES
RESA HANDOUT ATTACHED
ICARE HANDOUT ATTACHED
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SOLUTION MANUAL:
SITUATIONAL #2
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SITUATION #5