1 - When a company changes from one acceptable accounting method to another, the change is reported
A -in the statement of retained earnings, as a correction to the beginning balance.
B -in the income statement, below income from continuing operations.
C -in the income statement, above income from continuing operations
D -through a retroactive restatement of prior period earnings.
2 - Blackwelder Factory produces two similar products - small lamps and desk lamps. The total plant overhead budget is $640,000 with 400,000 estimated direct labor hours. It is further estimated that small lamp production will require 275,000 direct labor hours and desk lamp production will need 125,000 direct labor hours. Using the single plantwide factory overhead rate with an allocation base of direct labor hours, how much factory overhead will be allocated to the small lamp production if the actual direct hours for the period is 290,000?
A - $200,000
B - $320,000
C- $440,000
D - $464,000
3 - The Kaumajet Factory produces two products - table lamps and desk lamps. It has two separate departments - finishing and production. The overhead budget for the finishing department is $550,000, using 500,000 direct labor hours. The overhead budget for the production department is $400,000 using 80,000 direct labor hours. If the budget estimates that a table lamp will require 2 hours of finishing and 1 hours of production, what is the total amount of factory overhead to be allocated to table lamps using the multiple production department factory overhead rate method with an allocation base of direct labor hours, if 75,000 units are produced?
A - $368,250
B - $540,000
C - $832,500
D - $475,000
4 - When the rate of return on total assets ratio is greater than the rate of return on common stockholders' equity ratio, the management of the company has effectively used leverage. True or False