Assignment2

YORK UNIVERSITY

SCHULICH SCHOOL OF BUSINESS

ACCOUNTING 5210 – Section F

FINAL EXAM

Winter 2011 (M-1)

TIME: 180 Minutes

TOTAL MARKS: 90 Marks

INSTRUCTOR: Domenic Cianflone, MBA, PhD, FCMA

1. This is a closed book exam. You will be permitted to bring one double-sided 8.5” x 11” cheat sheet with you into the exam. Calculators that store text are not permitted. Use only paper provided at the exam. If you require paper for rough work, use the backs of the exam pages. Calculations on the questions sheets will not be graded.

2. Write your name and student number on the front of each exam booklet, and number each booklet you use. Also write your name on the question sheet.

3. You must hand in the question sheets with the exam. Please do not answer any questions in formal case format.

4. The exam has four questions and six pages (including the cover page). Make sure you have them all.

5. Please do not leave the room without the proctor’s knowledge. There are no questions allowed during the exam.

6. Do not communicate with anyone except the proctor. Make any necessary assumptions – proctors are not permitted to interpret the questions.

7. Show all calculations for part marks.

Good luck!

QUESTION #1 (20 Marks, 35 Minutes)

Thompson Industries is a reseller of camping gear. It carries approximately 40 different products with an average price of $170. Its cost per unit is $80 per unit.

The president of the company is a concerned with cash flow these days, and is looking to budget the next six months. Below is information relevant to the budget:

January: 100,000 units (budgeted)

February: 108,000 units (budgeted)

March: 112,000 units (budgeted)

April: 115,750 units (budgeted)

May: 118,000 units (budgeted)

June: 114,000 units (budgeted)

July: 112,500 units (budgeted)

Other relevant information:

The desired ending inventory balance is expected to be 35% of next month’s sales.

10% of all sales are cash. Of the remaining...