Accounting 2101 - Chapter 7

segment

A company's operations can be divided by product lines, geographical area, manufacturing plants, service centers or sales territories, which are known as ______.

segment

A part or activity within an organization about which managers would like cost, revenue or profit data is called a(n) ______.

fixed manufacturing overhead

Absorption and variable costing net income are usually different due to the accounting for ______.

$6,472.14

Citrus Scents produces body sprays. Each bottle has a unit product cost of $5.38. This month 1,490 bottles were produced and 1,203 bottles were sold. Total cost of goods sold is _____.

absorption, variable

Fixed manufacturing overhead costs are expensed as units sold as part of cost of goods sold under ______ costing, and expensed in full with period costs under ______ costing.

absorption, variable

For external reporting, income statements are generally prepared using ______ costing, while ______ costing is used for internal decision making purposes.

$68

Frames, Inc. manufactures large wooden picture frames. Each frame requires $19 of direct materials and $40 of direct labor. Variable manufacturing overhead cost is $9 per frame produced. The unit product cost of each frame using variable costing is $______.

Both income statements include product and period costs. Reported net income on the statements often differ.

Income statements prepared under variable and absorption costing?

$47 Unit product cost = $22 + $18 + $7 = $47. Selling and administrative costs are never considered part of product cost.

Put'er There manufactures baseball gloves. Each glove requires $22 of direct materials and $18 of direct labor. Variable manufacturing overhead cost is $7 per unit. Variable selling and administrative costs are $11 per unit sold and fixed selling and administrative costs are $13,200. The unit product cost using variable costing is ______ per unit.

are always treated as period costs

Selling and administrative expenses ______.

both variable and fixed manufacturing

Under absorption costing product costs consist of ______ costs.

False

Under absorption costing, fixed overhead is treated like a variable cost because a portion of the total cost is allocated to each unit produced, rather than being expensed as one large sum.

period

Under both variable costing and absorption costing, variable and fixed selling and administrative costs are treated as ______ costs.

direct labor direct materials variable manufacturing overhead

Under variable costing the cost of a unit of inventory does contain _______.

contribution margin

Variable costing income statements are based upon a ______ format.

17,483

Blissful Breeze manufactures and sells ceiling fans. Variable selling and administrative expense is $11.50 per fan and fixed selling and administrative expense is $7,800 per month. If Blissful Breeze produces 900 fans and sells 842 fans this month, total selling and administrative expenses will be $______.

variable

Direct costing or marginal costing are other terms for ______ costing.