FINAL EXAM ACCT 308

d. all of these answers are correct

A budget: a. aids in coordinating what needs to be done b. is the quantitative expression of a proposed plan of action c. includes both financial and nonfinancial aspects d. all of these answers are correct

a. the current disposal price of the old equipment

A company decided to replace an old machine with a new machine. Which of the following is considered a relevant cost? a. the current disposal price of the old equipment b. the book value of the old equipment c. the loss on the disposal of the old equipment d. depreciation expense on the old equipment

d. mathematical description of how a cost changes with changes in the level of an activity relating to that cost

A cost function is a _____. a. process of allocating costs to cost centers or cost objects b. is a very thorough and detailed way to identifying a cost object when there is a physical relationship between inputs and outputs c. process of calculating present value of projected cash flows d. mathematical description of how a cost changes with changes in the level of an activity relating to that cost

b. set specific expectations against which actual results can be compared

A good budgeting system forces managers to examine the business as they plan, so they can: a. complete the budgeting task on time b. set specific expectations against which actual results can be compared c. get promoted for doing a good job d. detect inaccurate historical records

b. expanding into new geographic areas

A manager of a profit center is responsible for all of the following EXCEPT: a. sales revenue b. expanding into new geographic areas c. selling and marketing costs d. the cost of merchandise

b. may assist in improving product design and efficiency

Activity-based-costing information: a. should be used when services place similar demands on resources b. may assist in improving product design and efficiency c. usually results in peanut-butter costing d. will yield inaccurate cost numbers when products are similar

b. that the purchasing manager purchased in smaller quantities to due to a change to just in time inventory methods

An unfavorable price variance for direct materials might indicate: a. that the purchasing manager skillfully negotiated a better purchase price b. that the purchasing manager purchased in smaller quantities due to a change to just in time inventory methods c. that the market had an unexpected oversupply of those materials d. congestion due to scheduling problems

b. $468.75 favorable found by budgeted price less actual price per pound x actual pound= (7.25-7.00) x 1875= 468.75 favorable

Apple Valley Orchards, Inc. (AVO), developed standard costs for direct material and direct labor. In 2011, AVO estimated the following standard costs for one of their most well loved products, the AVO classic Grandma's large apple pie which had a brown sugar coating on the top of the crust as well as including cranberry and mince ingredients in addition to the apples. During September, AVO produced and sold 1,200 pies using 1,875 pounds of direct materials at an average cost per pound of $7.00 and 280 direct labor hours at an average wage of $14.25 per hour. September's direct material price variance is: a. $75.00 unfavorable b. $468.75 favorable c. $468.75 unfavorable d. None of these answers are correct

c. 50% found by: mfg oh/ direct mfg labor= 400,000/800,000= .5 or 50%

Apple Valley applies manufacturing overhead costs to jobs on the basis of direct manufacturing labor cost using departmental rates determined at the beginning of the year. For department B, the manufacturing overhead allocation rate is: a. 100% b. 300% c. 50% d. 200%

c. variable costs per unit decrease

Assume only the specified parameter change in a CVP analysis. The contribution margin percentage increases when _____. a. variable costs per unit increase b. total fixed cost decrease c. variable costs per unit decrease d. total fixed costs increase

d. 40,200 units found by: 36,000+6000-1,800=40,200

Basile Corporation has budgeted sales of 36,000 units, target ending finished goods inventory of 6,000 units, and beginning finished goods inventory of 1,800 units. How many units should be produced next year? a. 31,800 units b. 43,800 units c. 36,000 units d. 40,200 units

b. $20 found by selling price less variable costs so 28.50 - (5.25 + 1.15 +.25 +1.85)

Bell company sells several products. Information of average revenue and costs is as follows: The contribution margin per unit is _____. a. $22 b. $20 c. $15 d. $125

b. a lower price than expected was paid for Material A

Berman's Camera Shop has prepared the following flexible budget for September and is in the process of interpreting the variances. F denotes a favorable variance and U denotes an unfavorable variance. The most-likely explanation of the above variances for Material A is that: a. higher quality raw materials were used than were planned b. a lower price than expected was paid for Material A c. the company used a higher priced supplier d. Material A used during September was $2,000 less than expected

$14,400 found by: $180 x 100 rustic tables = 18,000 x .80 variable costs =14,400

Black forest manufactures rustic furniture. The cost accounting system estimates manufacturing costs to be $180 pet table, consisting of 80 % variable costs and 20% fixed costs. The company has surplus capacity available. It is black forests policy to add a 50% markup to full costs Black forest is invited to bid on a one time only special order to supply 100 rustic tables. What is the lowest price black forest should bid on this special order? a. $18,000 b. $12,600 c. $14,400 d. $23,000

b. $165,000 found by: actual OI: (200,000 x $20)-1,250,000-925,000=1,825,000; budgeted OI: (203,000 x $20) - 1,500,000-900,000= 1,660,000; 1,825,000- 1,660,000=165,000 favorable

Caan corporation used the following data to evaluate their current operating system. The company sells items for $20 each and used a budgeted selling price of $20 per unit. What is the static budget variance of operating income? a. $190,000 unfavorable b. $165,000 favorable c. $60,000 unfavorable d. $60,000 favorable

c. the costing results for chess pieces under the new system depend on the adequacy and quality of the estimated cost drivers and costs used by the system

Chess woods limited produces two products: wooden chess pieces and wooden inlaid chess boards. under their traditional cost system using one cost drive (direct manufacturing labor hours), the cost of a set of wooden chess pieces is $325.00. An analysis of the activities and their costs revealed that three cost drivers would be used under a new ABC system. These cost drivers would be equipment usage, storage area for the material, and type of woods used. The new cost of a set of chess pieces was determined to be $298.00 per set. Given this change in the cost structure _____. a. chess pieces have benefited from the new system b. chess will now have a lower sales price c. the costing results for chess pieces under the new system depend on the adequacy and quality of the estimated cost drivers and costs used by the system d. chess pieces are definitely more accurately costed

d. Maximize: $128R + $720S Constraints: Labor-hours: 20R + 34S K 1,600 Machine-hours: 8R + 20S K 1,200 Special: S K 80 S L 0 Regular: R L 0

Computer Products produces two keyboards, Regular and Special. Regular keyboards have a unit contribution margin of $128, and Special keyboards have a unit contribution margin of $720. The demand for Regulars exceeds Computer Product's production capacity, which is limited by available machine-hours and direct manufacturing labor-hours. The maximum demand for Special keyboards is 80 per month. Management desires a product mix that will maximize the contribution toward fixed costs and profits. Direct manufacturing labor is limited to 1,600 hours a month and machine-hours are limited to 1,200 a month. The Regular keyboards require 20 hours of labor and 8 machine-hours. Special keyboards require 34 labor-hours and 20 machine-hours. Let R represent Regular keyboards and S represent Special keyboards. The correct set of equations for the keyboard production process is: a. Maximize: $128R + $720S Constraints: Labor-hours: 20R + 34S L 1,600 Machine-hours: 8R + 20S LK 1,200 Special: S L 80 S L 0 Regular: R L 0 b. Maximize: $128R + $720S Constraints: Labor-hours: 20R + 34S K 1,600 Machine-hours: 8R + 20S K 1,200 Special: S L 80 S K 0 Regular: R K 0 c. Maximize: $720S + $128R Constraints: Labor-hours: 20R + 8S K 1,600 Machine-hours: 34R + 20S K 1,200 Special: S K 80 S L 0 Regular: R L 0 d. Maximize: $128R + $720S Constraints: Labor-hours: 20R + 34S K 1,600 Machine-hours: 8R + 20S K 1,200 Special: S K 80 S L 0 Regular: R L 0

d. how costs react to a change in the level of activity

Cost behavior refers to ______. a. whether a cost is incurred in a manufacturing, merchandising, or service company b. classifying costs as either perpetual or period costs c. whether a particular expense is expensed in the same or the following period d. how costs react to a change in the level of activity

d. variable cost

Crimson Services, Inc. employs 8 individuals. They are all paid $16.50 per hour. How would total costs of personnel be classified? a. fixed cost b. irrelevant cost c. mixed cost d. variable cost

c. $8.00

Daniel Rubber company produces a specialty item. What is the cost per statue if throughput costing is used? a. $17.00 b. $13.00 c. $8.00 d. $20.00

care costs related to a particular cost object that can be traced to that cost object in a cost effective manner

Direct costs _____. a. focus specifically on the costing needs of the CFO b. are anything for which a measurement of costs is desired c. are costs related to a particular cost object that can be traced to that cost object in a cost effective manner d. are costs related to a particular cost object that cannot be traced to that cost object in a cost effective manner

c. production needs plus target ending inventories less beginning inventories

Direct materials purchases equal: a. production needs plus target ending inventories b. production needs plus beginning inventories c. production needs plus target ending inventories less beginning inventories d. production needs

d. $180,000

Elton Inc. expects to sell 6,000 ceramic vases for $40 each. Direct materials costs are $4, direct manufacturing labor is $20, and manufacturing overhead is $6 per vase. The following inventory levels apply to 2012: On the 2012 budgeted income statement, what amount will be reported for cost of goods sold? a. $177,000 b. $183,000 c. $210,000 d. $180,000

d. qualitative factors

Employee morale at Dos Santos, Inc is very high. This type of information is an example of _____. a. irrelevant factors b. quantitative factors c. financial factors d. qualitative factors

a. qualitative factor

Employee morale at Dos Santos, Inc, is very high. This type of information is known as a: a. qualitative factor b. nonmeasurable factor c. quantitative factor d. financial factor

c. that capacity may need to be reevaluated

Excess capacity is a sign: a. that the company is suffering a significant economic loss b. of good management decisions c. that capacity may need to be reevaluated d. that capacity should be reduced

d. $45.00 per hour; $120.00 per hour

Fixed costs remain constant at $400,000 per month. During high output months variable costs are $320,000 and during low output months variable costs are $80,000. What are the respective high and low indirect cost rates if budgeted professional labor-hours are 16,000 for high output months and 4,000 for low output months? a. $45.00 per hour; $45.00 per hour b. $56.20 per hour; $120.00 per hour c. $25.00 per hour; $20.00 per hour d. $45.00 per hour; $120.00 per hour

b. are unaffected by the degree of operating efficiency in a given budget period

Fixed overhead costs: a. never have any unused capacity b. are unaffected by the degree of operating efficiency in a given budget period c. should be unitized for planning purposes d. Both a and b are correct

c. both work in process inventory and finished goods inventory

For a manufacturing company, direct labor costs may be included in ______. a. direct materials inventory only b. merchandise inventory only c. both work in process inventory and finished goods inventory d. direct materials inventory, work in process inventory, and finished goods inventory accounts

b. manufacturing overhead cost

For a manufacturing-sector company, the cost of factory depreciation is classified as a: a. direct material cost b. manufacturing overhead cost c. direct manufacturing labor cost d. period cost

b. $103,000 found by: beg. inventory of finished goods + cost of goods manufactured - end. inventory of finished goods; 35,000 + 104,000 - 36,000 = 103,000

For last year, Lewisburn manufacturing reported the following: What was Lewisburn's cost of goods sold? a. $152,000 b. $103,000 c. $317,000 d. $268,000

d. 81,840 mattresses

Furniture Inc. estimates the following number of mattress sales for the first four months of 2016: Finishd goods inventory at the end of December is 6,600 units. Target ending finished goods inventory is 20% of the next months sales. How many mattresses should be produced in the first quarter of 2016? a. 60,280 mattresses b. 51,920 mattresses c. 88,880 mattresses d. 81,840 mattresses

c. the account analysis method

Genend's good value appliance store is a small company that has hired you to perform some management advisory services. Which cost estimation method is being used by Genend's good value appliance store? a. the marginal costing method b. the cost volume profit analysis method c. the account analysis method d. the operating costing method

c. $30,300

Hector's Camera Shop has prepared the following flexible budget for September and is in the process of interpreting the variances. F denotes a favorable variance and U denotes an unfavorable variance. The actual amount spent for Material B was: a. $30,500 b. $29,700 c. $30,300 d. $30,800

b. production manager

If a sales-volume variance was caused by poor quality products, then the _______ would be in the best position to explain the variance. a. purchasing manager b. production manager c. management accountant d. sales manager

a. $38,500

If selling price per unit is $40, variable costs per unit are $25, total fixed costs are $20,000, the tax rate is 30% and the company sells 5,000 units, net income is _____. a. $38,500' b. $26,548 c. $32,158 d. $28,500

b. 2.50 times found by $500,000 x .4 = 200,000 then 200,000/80,000= 2.5 times

If the contribution margin ratio is .40, targeted operating income is $80,000, and targeted sales volume in dollars is $500,000, then the degree of operating leverage is ______. a. 3.00 times b. 2.50 times c. 2.00 times d. 1.50 times

a. $25,000 found by sales volume x ratio less operating income so .25 x 200,000=50,000 -25,000= 25,000

If the contribution margin ratio is 0.25, targeted operating income is $25,000, and targeted sales volume in dollars is $200,000, then total fixed costs are: a. $25,000 b. $100,000 c. $50,000 d. $75,000

a. decrease

If the sales mix shifts down to one unit of Product X and up to two units of Product Y, then the breakeven point will ______. a. decrease b. stay the same c. will be greater than the original breakeven point d. increase

b. zero; zero

In the above chart, the amounts for (A) and (B), respectively, are: a. Zero; $110,000 U b. Zero; Zero c. $21,000 U; $110,000 U d. $21,000 U; Zero

c. is the factor used to predict the dependent variable

In the estimation of a cost function using quantitative analysis, the independent variable _____. a. is the product of total costs and slope coefficient b. is the product of fixed costs and slope coefficient c. is the factor used to predict the dependent variable d. is the cost to be predicted

c. may include both variable and fixed costs

Indirect manufacturing costs: a. generally include the cost of material and the cost of labor b. can be traced to the product that created the costs c. may include both variable and fixed costs d. can be easily identified with the cost object

d. costs of a product that are considered assets in a companys balance sheet when the costs are incurred and that are expensed as cost of goods sold only when the product is sold

Inventoriable costs are costs of a product that are ______. a. considered as liabilities in a companys income statement when the costs are capitalized and that are expensed only when the product is sold b. considered liabilities in a companys balance sheet when the costs are incurred and that are expensed only when the product is sold c. considered as assets in a companys income statement when the costs are capitalized and that are expensed as cost of goods sold only when the product is sold d. costs of a product that are considered assets in a companys balance sheet when the costs are incurred and that are expensed as cost of goods sold only when the product is sold

c. $32,800 unfavorable found by (budget cm x budget units) - (budget cm x actual units) so (164 x 1200) - (164 x 1000)= 32,800 U

JJ Abrams' budgeted contribution margin was $164 per unit, but the actual contribution margin was $160 per unit, and planned to sell 1,200 units but actually sold 1,000 units. The sales-volume variance is: a. $4,800 favorable b. $4,000 favorable c. $32,800 unfavorable d. $28,000 unfavorable

b. acquisition cost of the trail blazer

Johns 8 year old chevrolet trail blazer requires repairs estimated at $6,000 to make it roadworthy again. His wife, sherry, suggested that he should buy a 5 year old used jeep grand cherokee instead for $6,000 cash. The cost NOT relevant for this decision is the _____. a. repairs to the trail blazer b. acquisition cost of the trail blazer c. acquisition cost of the grand cherokee d. annual operating costs of the grand cherokee

d. direct materials inventory, work in process inventory, and finished goods inventory accounts

Manufacturing-sector companies report: a. no inventory accounts b. only finished goods inventory c. only merchandise inventory d. direct materials inventory, work-in-process inventory, and finished goods inventory accounts

d. be underbilled for actual resources used

Mark papers employs 15 full time employees and 10 trainees. Direct and indirect costs are applied on a professional labor hour basis that includes both employee and trainee hours. Following is information for 2014: When a normal costing system is used, clients using proportionately more full time employees than trainees will ______. a. result in an underallocation of direct costs b. be billed for actual resources used c. be overbilled for actual resources used d. be underbilled for actual resources used

a. $338,258.95 found by: 5,240.95 + (951.48 x 350)= $338,258.96

Midose's stables What is the estimated total cost for the coming year is 15,000 trainer hours are incurred and the stable has 350 horses to be trained, based upon the best cost driver. a. $338,258.95 b. $345,854.65 c. $14,277,440.95 d. $96,327.90

c. $1,300 favorable Found by: 15,000 actual units/250 units per batch= 60 actual batches, 15,000 actual units/225 static budget units per batch= 66.67 batches; actual= $40 x 60 x 5=12,000; Flex= 66.67 x 5.25 x $38= 13,300; 13,300 less 12,000 =1,300 favorable

Munoz inc. produces a special line of plastic toy racing cars. Calculate the flexible budget variance setup overhead costs a. $1,300 unfavorable b. $600 unfavorable c. $1,300 favorable d.$600 favorable

a. budgeted indirect costs exceed actual indirect costs

One reason indirect costs may be overapplied is because: a. budgeted indirect costs exceed actual indirect costs b. the actual allocation base quantity exceeds the budgeted quantity c. requisitioned direct materials exceed budgeted material costs d. both A and B are correct

b. the use of scarce resources

Operating decisions primarily deal with: a. acquiring equipment and buildings b. the use of scarce resources c. how to obtain funds to acquire resources d. satisfying stockholders

c. CADB

Place the following steps in the order suggested by the seven steps used to assign costs to individual jobs: A. Identify indirect costs B. Compute the total cost of the job C. Select cost allocation bases D. Compute the indirect cost rate a. ACDB b. BACD c. CADB d. DCAB

c. means that if a company undercosts one of its products, it will overcost at least one of its other products

Product cost cross subsidization ______. a. means that if a company undercosts more than one of its products, it will overcost more than one of its other products b. exists when one overcosted product results in more than one other product being overcosted c. means that if a company undercosts one of its products, it will overcost at least one of its other products d. exists only when on overcosted product results in all other products being overcosted

b. measures the average amount of change in the dependent variable associated with a unit change in one or more independent variables

Regression analysis ____. a. measures the variability or dispersion in a set of data points b. measures the average amount of change in the dependent variable associated with a unit change in one or more independent variables c. calculates the slope coefficient using only two observed values within the relevant range and their respective costs d. estimates the cost functions using the time and motion studies

a. focuses on whom should be asked about the information

Responsibility accounting: a. focuses on whom should be asked about the information b. attempts to assign blame for problems to a specific manager c. emphasizes controllability d. all of these answers are correct

b. are similar in proportion to each other

Smaller cost distortions occur when the traditional systems single indirect cost rate and the activity cost driver rates _____. a. use the same cost driver units b. are similar in proportion to each other c. use the same total costs for computations d. are more different than alike

d. $16,000

The Delmonico Company uses the high-low method to estimate the cost function. The information for 2011 is provided below: What is the estimate of the total cost when 300 machine-hours are used? a. $4,000 b. $8,000 c. $12,000 d. $16,000

d. write off to cost of goods sold approach

The approach often used when dealing with small amounts of underallocated or overallocated overhead is the ______. a. adjusted allocation rate approach b. proration approach c. adjusted write off approach d. write off to cost of goods sold approach

b. total fixed costs decrease

The breakeven point decreases if: a. the contribution margin per unit decreases b. total fixed costs decrease c. the variable cost per unit increases d. the selling price per unit decreases

c. budgeted revenues and breakeven revenues

The margin of safety is the difference between: a. actual operating income and budgeted operating income b. actual contribution margin and budgeted contribution margin c. budgeted revenues and breakeven revenues d. budgeted expenses and breakeven expenses

a. rate at which the dependent variable varies

The slope of the line of regression is the ______. a. rate at which the dependent variable varies b. difference between actual cost and estimated cost for each observation of the cost driver c. difference between the fixed cost and variable cost associated with the cost driver d. rate at which the independent variable varies

d. individual activities

The unique feature of an ABC system is the emphasis on: a. multiple-cost pools b. costing individual jobs c. department indirect cost rates d. individual activities

a. actual variable overhead costs and the flex budget for variable overhead costs

The variable overhead flex budget variance measures the difference between: a. actual variable overhead costs and the flexible budget for variable overhead costs b. the static budget for variable overhead costs and the flex budget for variable overhead costs d. none of these answers are correct

a. both variable manufacturing costs

To determine contribution margin use: a. both variable manufacturing costs and variable nonmanufacturing costs b. only variable manufacturing costs c. both variable and fixed manufacturing costs d. only fixed manufacturing costs

a. the direct material price variance

Typically, managers have the Least control over: a. the direct material price variance b. machine maintenance c. the direct material efficiency variance d. the scheduling of production

d. increasing the managers bonus

Under absorption costing, if a managers bonus is tied to operating income, then increasing inventory levels compared to last year would result in _____. a. not affecting the managers bonus b. decreasing the managers bonus c. being unable to determine the managers bonus using only the above information d. increasing the managers bonus

a. practical capacity

Using _____ as the denominator level also gives the manager a more accurate idea of the resources needed and used to produce a unit by excluding the cost of unused capacity. a. practical capacity b. normal capacity utilization c. master budget capacity utilization d. theoretical capacity

d. 0

Veach corporation incurred fixed manufacturing costs of $6,000 during 2015. The company uses variable costing and the fixed manufacturing cost rate is based on the budgeted denominator level. Manufacturing variances are closed to cost of goods sold. The production volume variance totals ___. a. $1,500 b. $2,000 c. $2,400 d. 0

d. credit to Direct Materials Inventory for $82,000

Wayland Manufacturing uses a normal cost system and had the following data available for 2010. The journal entry to record the materials placed into production would include a: a. debit to Direct Materials Inventory for $148,000 b. debit to WIP Inventory for $148,000 c. credit to WIP Inventory for $82,000 d. credit to Direct Materials Inventory for $82,000

c. $50,000 found by $40,000/(1-.2)=50,000

When fixed costs are $40,000 and variable costs are 20% of the selling price, then breakeven sales are: a. $200,000 b. $40,000 c. $50,000 d. indeterminable

d. a new competitor gaining market share

When machine-hours are used as a cost allocation base, the item most likely to contribute to an unfavorable production volume variance is: a. a new manufacturing machine costing considerably more than expected b. strengthened demand for the product c. an increase in the cost of energy d. a new competitor gaining market share

c. evaluation and feedback

When using the five step decision process, which one of the following steps should be done last? a. implementing the decision b. obtain information c. evaluation and feedback d. choose an alternative

d. electricity consumed in manufacturing process

Which of the following costs is inventoried when using variable costing? a. advertising costs incurred for the product b. rent on factory building c. sales commission paid on each sale d. electricity consumed in manufacturing process

d. work in process control account

Which of the following general ledger accounts will have a subsidiary ledger account? a. cost of goods sold account b. operating expenses account c. Joe's accounts receivable subsidiary account d. work in process control account

d. it reduces the incentive for undesirable buildup of inventories

Which of the following is a reason for companies adopting variable costing for internal reporting purposes? a. it is cost effective to use variable costing for both internal and external reporting b. it measures the cost of all manufacturing resources, whether variable or fixed, necessary to produce inventory c. it assists in accurate pricing decisions in case of long run pricing d. it reduces the incentives for undesirable buildup of inventories

c. capacity costs are difficult to estimate

Which of the following is true of capacity costs? a. capacity costs cannot be used with activity based costing b.capacity costs do not arise in the nonmanufacturing parts of the value chain c. capacity costs are difficult to estimate d. capacity costs don't provide a useful planning tool for nonmanufacturing firms

c. indirect costs cannot be traced to a particular cost object in an economically feasible way

Which of the following is true of indirect costs? a. indirect costs are always considered sunk costs b. indirect costs always vary in direct proportion to the level of production c. indirect costs cannot be traced to a particular cost object in an economically feasible way d. all indirect costs are included in cost of goods sold

b. it is intended for future use

Which of the following is true of unused capacity? a. it is not possible to reduce or eliminate unused capacity costs b. it is intended for future use c. it is a definite sign of wasted resources d. it does not provide capacity for potential demand surges

b.inventoriable costs are a special case of period costs

Which of the following statements is FALSE? a. inventoriable costs are important for GAAP b. inventoriable costs are a special case of period costs c. product costs and inventoriable costs are interchangeable terms d. product costs refers to the particular costs of a product for the purpose at hand

a. holds managers responsible for uncontrollable costs

Which statement about controllability is NOT true: a. holds managers responsible for uncontrollable costs b. describes the degree of influence that managers have over a particular item c. with a long enough time span, all costs will come under somebody's control d. few costs are clearly under the sole influence of one manager

a. total fixed costs will remain the same and total variable costs will change

Within the relevant range, if there is a change in the level of the cost driver, then ______. a. total fixed costs will remain the same and total variable costs will change b. total fixed costs and total variable costs will remain the same c. total fixed costs will change and total variable costs will remain the same d. total fixed costs and total variable costs will change

a. service sector company

Yahoo, an Internet search firm, would be classified as a(n) ______. a. service sector company b. merchandising sector company c. manufacturing sector company d. financial services

b. $21 found by: sales commissions plus administrative salaries so 5 + 16=21

Zephyr apparels is a clothing retailer. Unit costs associated with one of its products, Product DCT121, are as follows: What are the period costs per unit associated with the product DCT121? a. $16 b. $21 c. $52 d. $4

a. absorption costing

_____ is a method of inventory costing in which all variable manufacturing costs and all fixed manufacturing costs are included as inventoriable costs. a. absorption costing b. standard costing c. variable costing d. mixed costing

d. the revenues budget

_______ is the usual starting point for budgeting. a. the cash budget b. net income c. the production budget d. the revenues budget

c. cost allocation

________ is the process of distributing indirect costs to products. a. Cost tracing b. Cost pooling c. Cost allocation d. Job cost recording

b. set specific expectations against which actual results can be compared

a good budgeting system forces managers to examine the business as they plan, so they can: a. detect inaccurate historical records b. set specific expectations against which actual results can be compared c. get promoted for doing a good job d. complete the budgeting task on time

d. the price of variable overhead items are more than budgeted

an unfavorable variable overhead spending variance indicates that: a. variable overhead items were not used efficiently b. the variable overhead cost allocation base was not used efficiently c. the denominator level was not accurately determined d. the price of variable overhead items are more than budgeted

a. by classifying cost accounts as variable, fixed, or mixed based on qualitative analysis

the account analysis method estimates cost functions: a. by classifying cost accounts as variable, fixed, or mixed based on qualitative analysis b. at a high cost, which renders it seldom used c. in a manner that cannot be usefully combined with any other cost estimation methods d. using time and motion studies

c. inaccurate forecasting of units sold

the sales volume variance is due to: a. poor production performance b. using a different selling price from that budgeted c. inaccurate forecasting of units sold d. both A and B are correct