215 Midterm #1
Abare Corporation reported the following data for the month of December: Direct materials $63,000 Direct labor cost $52,000 Manufacturing overhead $77,000 Selling expense $26,000 Administrative expense $36,000 The prime cost for December was: $129,000 $115,000 $109,000 $62,000
$115,000
Calip Corporation, a merchandising company, reported the following results for October: Sales $433,000 Cost of goods sold (all variable) $173,000 Total variable selling expense $18,000 Total fixed selling expense $9,900 Total variable administrative expense $10,000 Total fixed administrative expense $25,600 The gross margin for October is: $232,000 $260,000 $397,500 $196,500
$260,000
A partial listing of costs incurred during December at Rooks Corporation appears below: Factory supplies $7,000 Administrative wages and salaries $92,000 Direct materials $176,000 Sales staff salaries $32,000 Factory depreciation $52,000 Corporate headquarters building rent $47,000 Indirect labor $23,000 Marketing $136,000 Direct labor $82,000 The total of the manufacturing overhead costs listed above for December is: $30,000 $82,000 $647,000 $340,000
$82,000
Which of the following would most likely be included as part of manufacturing overhead in the production of a wooden table? The amount paid to the individual who stains the table. The commission paid to the salesperson who sold the table. The cost of glue used in the table. The cost of the wood used in the table.
The cost of glue used in the table.
Corcetti Company manufactures and sells prewashed denim jeans. Large rolls of denim cloth are purchased and are first washed in a giant washing machine. After the cloth is dried, it is cut up into jean pattern shapes and then sewn together. The completed jeans are sold to various retail chains. Which of the following terms could be used to correctly describe the wages paid to the workers that cut up the cloth into the jean pattern shapes? Conversion Cost: Variable Cost
Yes Yes
he salary paid to the maintenance supervisor in a manufacturing plant is an example of: Product cost? Manufacturing overhead?
Yes Yes
The ________________________ is the amount remaining from sales revenue after all variable expenses have been deducted. cost structure gross margin contribution margin committed fixed cost
contribution margin
The costs of the Accounting Department at Central Hospital would be considered by the Surgery Department to be: direct costs. indirect costs. incremental costs. opportunity costs.
indirect costs.
All of the following costs would be found in a company's accounting records except: sunk cost. opportunity cost. indirect costs. direct costs.
opportunity cost.
In a manufacturing company, direct labor costs combined with direct materials costs are known as: period costs. conversion costs. prime costs. opportunity costs.
prime costs.
Inventoriable costs are also known as: variable costs. conversion costs. product costs. fixed costs.
product costs.
All of the following would be classified as product costs except: property taxes on production equipment. insurance on factory machinery. salaries of the marketing staff. wages of machine operators.
salaries of the marketing staff.
Contribution margin means: what remains from total sales after deducting fixed expenses. what remains from total sales after deducting cost of goods sold. the sum of cost of goods sold and variable expenses. what remains from total sales after deducting all variable expenses.
what remains from total sales after deducting all variable expenses.
A soft drink bottler incurred the following factory utility cost: $3,936 for 800 cases bottled and $3,988 for 900 cases bottled. Factory utility cost is a mixed cost containing both fixed and variable components. The variable factory utility cost per case bottled is closest to: $4.92 $0.52 $4.43 $4.66
$0.52
Data concerning Nelson Company's activity for the first six months of the year appear below: Machine Hours Electrical Cost January 4,000 $3,120 February 6,000 $4,460 March 4,800 $3,500 April 3,800 $3,040 May 3,600 $2,900 June 4,200 $3,200 Using the high-low method of analysis, the estimated variable electrical cost per machine hour is: $0.65 $0.40 $0.70 $0.67
$0.65
Ence Sales, Inc., a merchandising company, reported sales of 6,400 units in April at a selling price of $684 per unit. Cost of goods sold, which is a variable cost, was $455 per unit. Variable selling expenses were $30 per unit and variable administrative expenses were $40 per unit. The total fixed selling expenses were $156,800 and the total administrative expenses were $260,400. The contribution margin for April was: $1,017,600 $1,465,600 $600,400 $3,512,400
$1,017,600
Baker Corporation has provided the following production and total cost data for two levels of monthly production volume. The company produces a single product. Production volume 6,000 units 7,000 units Direct materials $194,400 $226,800 Direct labor $74,400 $86,800 Manufacturing overhead $758,400 $779,800 The best estimate of the total cost to manufacture 6,300 units is closest to: $984,060 $1,031,310 $1,047,060 $1,078,560
$1,047,060
Tolden Marketing, Inc., a merchandising company, reported sales of $2,861,800 and cost of goods sold of $1,492,400 for December. The company's total variable selling expense was $77,900; its total fixed selling expense was $70,600; its total variable administrative expense was $98,400; and its total fixed administrative expense was $193,400. The cost of goods sold in this company is a variable cost. The contribution margin for December is: $1,369,400 $2,421,500 $1,193,100 $929,100
$1,193,100
Farmington Corporation has provided the following production and total cost data for two levels of monthly production volume. The company produces a single product. Production volume 6,000 units 7,000 units Direct materials $195,000 $227,500 Direct labor $113,400 $132,300 Manufacturing overhead $913,200 $931,700 The best estimate of the total cost to manufacture 6,300 units is closest to: $1,162,350 $1,242,570 $1,222,515 $1,282,680
$1,242,570
Tolden Marketing, Inc., a merchandising company, reported sales of $2,861,800 and cost of goods sold of $1,492,400 for December. The company's total variable selling expense was $77,900; its total fixed selling expense was $70,600; its total variable administrative expense was $98,400; and its total fixed administrative expense was $193,400. The cost of goods sold in this company is a variable cost. The gross margin for December is: $1,193,100 $929,100 $1,369,400 $2,597,800
$1,369,400
Ence Sales, Inc., a merchandising company, reported sales of 6,400 units in April at a selling price of $684 per unit. Cost of goods sold, which is a variable cost, was $455 per unit. Variable selling expenses were $30 per unit and variable administrative expenses were $40 per unit. The total fixed selling expenses were $156,800 and the total administrative expenses were $260,400. The gross margin for April was: $1,465,600 $3,960,400 $1,017,600 $600,400
$1,465,600
Farnor, Inc., would like to estimate the variable and fixed components of its electrical costs and has compiled the following data for the last four months of operations. Machine Hours Electrical Cost January 30 $75 February 42 $90 March 35 $81 April 20 $68 Using the high-low method of analysis, the estimated variable cost per machine hour for electricity is closest to: $3.40 $2.14 $1.00 $0.87
$1.00
Supply costs at Chobot Corporation's chain of gyms are listed below: Client-Visits Supply Cost January 12,183 $26,642 February 12,408 $26,853 March 12,232 $26,675 April 12,597 $27,054 May 12,527 $26,988 June 12,608 $27,064 July 12,143 $26,585 August 12,005 $26,454 September 11,944 $26,393 Management believes that supply cost is a mixed cost that depends on client-visits. Use the high-low method to estimate the variable and fixed components of this cost. Compute the variable component first, rounding off to the nearest whole cent. Then compute the fixed component, rounding off to the nearest whole dollar. Those estimates are closest to: $2.18 per client-visit; $26,745 per month $1.01 per client-visit; $14,330 per month $1.04 per client-visit; $13,949 per month $0.99 per client-visit; $14,607 per month
$1.01 per client-visit; $14,330 per month
Management of Lewallen Corporation has asked your help as an intern in preparing some key reports for September. Direct materials cost was $57,000, direct labor cost was $43,000, and manufacturing overhead was $71,000. Selling expense was $15,000 and administrative expense was $32,000. The prime cost for September was: $114,000 $100,000 $103,000 $47,000
$100,000
The following production and average cost data for two levels of monthly production volume have been supplied by a company that produces a single product: Production volume 1,000 units 3,000 units Direct materials $13.20 per unit $13.20 per unit Direct labor $14.50 per unit $14.50 per unit Manufacturing overhead $65.40 per unit $29.40 per unit The best estimate of the total cost to manufacture 1,200 units is closest to: $68,520 $100,920 $111,720 $90,120
$100,920
Iaci Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $133.60 per unit. Sales volume (units) 4,000 5,000 Cost of sales $383,600 $479,500 Selling and administrative costs $124,400 $136,000 The best estimate of the total contribution margin when 4,300 units are sold is: $112,230 $162,110 $28,380 $45,150
$112,230
Management of Lewallen Corporation has asked your help as an intern in preparing some key reports for September. Direct materials cost was $57,000, direct labor cost was $43,000, and manufacturing overhead was $71,000. Selling expense was $15,000 and administrative expense was $32,000. The conversion cost for September was: $114,000 $131,000 $171,000 $103,000
$114,000
Abare Corporation reported the following data for the month of December: Direct materials $63,000 Direct labor cost $52,000 Manufacturing overhead $77,000 Selling expense $26,000 Administrative expense $36,000 The conversion cost for December was: $134,000 $109,000 $192,000 $129,000
$129,000
Comco, Inc. has accumulated the following data for the cost of maintenance on its machinery for the last four months: Machine Hours Maintenance Cost September 21,000 $26,020 October 18,500 $24,600 November 15,000 $22,300 December 19,000 $25,100 Assume that the relevant range includes all of the activity levels mentioned in this problem. Assuming Comco uses the high-low method of analysis, the fixed cost of maintenance would be estimated to be: $14,500 $5,020 $13,000 $12,320
$13,000
Nieman Inc., a local retailer, has provided the following data for the month of March: Merchandise inventory, beginning balance $30,000 Merchandise inventory, ending balance $34,000 Sales $280,000 Purchases of merchandise inventory $146,000 Selling expense $27,000 Administrative expense $64,000 The cost of goods sold for March was: $146,000 $150,000 $142,000 $237,000
$142,000
ddy Corporation has provided the following production and total cost data for two levels of monthly production volume. The company produces a single product. Production volume 6,000 units 7,000 units Direct materials $582,600 $679,700 Direct labor $136,200 $158,900 Manufacturing overhead $691,800 $714,700 The best estimate of the total variable manufacturing cost per unit is: $22.90 $119.80 $142.70 $97.10
$142.70
The following cost data pertain to the operations of Bouffard Department Stores, Inc., for the month of May. Corporate legal office salaries $68,000 Shoe Department cost of sales-Brentwood Store $29,000 Corporate headquarters building lease $86,000 Store manager's salary-Brentwood Store $12,000 Shoe Department sales commissions-Brentwood Store $5,000 Store utilities-Brentwood Store $10,000 Shoe Department manager's salary-Brentwood Store $4,000 Central warehouse lease cost $7,000 Janitorial costs-Brentwood Store $10,000 The Brentwood Store is just one of many stores owned and operated by the company. The Shoe Department is one of many departments at the Brentwood Store. The central warehouse serves all of the company's stores. What is the total amount of the costs listed above that are NOT direct costs of the Brentwood Store? $161,000 $86,000 $32,000 $38,000
$161,000
The following cost data pertain to the operations of Rademaker Department Stores, Inc., for the month of March. Corporate headquarters building lease $80,000 Cosmetics Department sales commissions-Northridge Store $7,000 Corporate legal office salaries $75,000 Store manager's salary-Northridge Store $11,000 Heating-Northridge Store $11,000 Cosmetics Department cost of sales-Northridge Store $83,000 Central warehouse lease cost $17,000 Store security-Northridge Store $11,000 Cosmetics Department manager's salary-Northridge Store $4,000 The Northridge Store is just one of many stores owned and operated by the company. The Cosmetics Department is one of many departments at the Northridge Store. The central warehouse serves all of the company's stores. What is the total amount of the costs listed above that are NOT direct costs of the Northridge Store? $172,000 $33,000 $80,000 $94,000
$172,000
Frank Company operates a cafeteria for its employees. The number of meals served each week over the last seven weeks, along with the total costs of operating the cafeteria are given below: Meals served Cafeteria costs Week 1 1,500 $4,800 Week 2 1,600 $5,080 Week 3 1,800 $5,280 Week 4 1,450 $4,900 Week 5 1,200 $4,000 Week 6 1,650 $5,100 Week 7 1,900 $5,400 Assume that the relevant range includes all of the activity levels mentioned in this problem. Using the high-low method of analysis, the variable cost per meal served in the cafeteria would be estimated to be: $1.50 $2.00 $2.80 $1.00
$2.00
Comparative income statements for Tudor Retailing Company for the last two months are presented below: September October Sales in units 5,000 7,000 Sales revenue $100,000 $140,000 Cost of goods sold 40,000 56,000 Gross margin 60,000 84,000 Selling and administrative expenses: Shipping expense 7,500 10,500 Clerical expense 10,000 12,000 Maintenance expense 17,000 17,000 Total selling and administrative expense 34,500 39,500 Net operating income $25,500 $44,500 If the Tudor Retailing Company uses the high-low method of analysis, the total monthly fixed cost for Tudor Retailing Company would be estimated to be: $34,500 $17,000 $27,000 $22,000
$22,000
Calip Corporation, a merchandising company, reported the following results for October: Sales $433,000 Cost of goods sold (all variable) $173,000 Total variable selling expense $18,000 Total fixed selling expense $9,900 Total variable administrative expense $10,000 Total fixed administrative expense $25,600 The contribution margin for October is: $260,000 $232,000 $196,500 $369,500
$232,000
Comco, Inc. has accumulated the following data for the cost of maintenance on its machinery for the last four months: Machine Hours Maintenance Cost September 21,000 $26,020 October 18,500 $24,600 November 15,000 $22,300 December 19,000 $25,100 Assume that the relevant range includes all of the activity levels mentioned in this problem. Assuming Comco uses the high-low method of analysis, if machine hours are budgeted to be 20,000 hours then the budgeted total maintenance cost would be expected to be: $25,400 $25,560 $23,700 $24,720
$25,400
Krimton Corporation's manufacturing costs last year consisted of $150,000 of direct materials, $200,000 of direct labor, $40,000 of variable manufacturing overhead, and $25,000 of fixed manufacturing overhead. Conversion cost was: $200,000 $240,000 $265,000 $415,000
$265,000
During the month of April, direct labor cost totaled $15,000 and direct labor cost was 30% of prime cost. If total manufacturing costs during April were $79,000, the manufacturing overhead was: $35,000 $29,000 $50,000 $129,000
$29,000
Electrical costs at one of Reifel Corporation's factories are listed below: Machine-Hours Electrical Cost March 413 $7,371 April 506 $7,740 May 435 $7,447 June 486 $7,660 July 499 $7,704 August 461 $7,563 September 467 $7,571 October 458 $7,522 November 425 $7,403 Management believes that electrical cost is a mixed cost that depends on machine-hours. Using the high-low method, the estimate of the variable component of electrical cost per machine-hour is closest to: $0.12 $20.38 $7.98 $3.97
$3.97
A partial listing of costs incurred at Gilhooly Corporation during September appears below: Direct materials $183,000 Utilities, factory $9,000 Administrative salaries $90,000 Indirect labor $25,000 Sales commissions $33,000 Depreciation of production equipment $25,000 Depreciation of administrative equipment $32,000 Direct labor $124,000 Advertising $148,000 The total of the period costs listed above for September is: $303,000 $59,000 $366,000 $362,000
$303,000
A partial listing of costs incurred during December at Rooks Corporation appears below: Factory supplies $7,000 Administrative wages and salaries $92,000 Direct materials $176,000 Sales staff salaries $32,000 Factory depreciation $52,000 Corporate headquarters building rent $47,000 Indirect labor $23,000 Marketing $136,000 Direct labor $82,000 The total of the period costs listed above for December is: $82,000 $340,000 $389,000 $307,000
$307,000
Callis Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $141.60 per unit. Sales volume (units) 5,000 6,000 Cost of sales $265,500 $318,600 Selling and administrative costs $393,500 $406,800 The best estimate of the total monthly fixed cost is: $692,200 $725,400 $659,000 $327,000
$327,000
Anderson Corporation has provided the following production and average cost data for two levels of monthly production volume. The company produces a single product. Production volume 4,000 units 5,000 units Direct materials $99.20 per unit $99.20 per unit Direct labor $45.50 per unit $45.50 per unit Manufacturing overhead $94.00 per unit $77.60 per unit The best estimate of the total monthly fixed manufacturing cost is: $388,000 $954,800 $376,000 $328,000
$328,000
Davis Corporation has provided the following production and total cost data for two levels of monthly production volume. The company produces a single product. Production volume 1,000 units 2,000 units Direct materials $44,200 $88,400 Direct labor $37,300 $74,600 Manufacturing overhead $48,500 $62,200 The best estimate of the total monthly fixed manufacturing cost is: $130,000 $177,600 $34,800 $225,200
$34,800
A partial listing of costs incurred during December at Rooks Corporation appears below: Factory supplies $7,000 Administrative wages and salaries $92,000 Direct materials $176,000 Sales staff salaries $32,000 Factory depreciation $52,000 Corporate headquarters building rent $47,000 Indirect labor $23,000 Marketing $136,000 Direct labor $82,000 The total of the product costs listed above for December is: $340,000 $82,000 $647,000 $307,000
$340,000
Gambino Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $138.80 per unit. Sales volume (units) 6,000 7,000 Cost of sales $369,000 $430,500 Selling and administrative costs $407,400 $418,600 The best estimate of the total monthly fixed cost is: $776,400 $340,200 $812,750 $849,100
$340,200
Krimton Corporation's manufacturing costs last year consisted of $150,000 of direct materials, $200,000 of direct labor, $40,000 of variable manufacturing overhead, and $25,000 of fixed manufacturing overhead. Prime cost was: $150,000 $190,000 $350,000 $415,000
$350,000
Cardillo Inc., an escrow agent, has provided the following data concerning its office expenses: Escrows Completed Office Expenses January 99 $13,181 February 111 $13,598 March 129 $14,239 April 133 $14,357 May 152 $15,095 June 104 $13,335 July 118 $13,847 August 100 $13,211 September 103 $13,283 Management believes that office expense is a mixed cost that depends on the number of escrows completed. Note: Real estate purchases usually involve the services of an escrow agent that holds funds and prepares documents to complete the transaction. Using the high-low method, the estimate of the variable component of office expense per escrow completed is closest to: $26.75 $118.23 $36.11 $72.49
$36.11
A partial listing of costs incurred at Gilhooly Corporation during September appears below: Direct materials $183,000 Utilities, factory $9,000 Administrative salaries $90,000 Indirect labor $25,000 Sales commissions $33,000 Depreciation of production equipment $25,000 Depreciation of administrative equipment $32,000 Direct labor $124,000 Advertising $148,000 The total of the product costs listed above for September is: $59,000 $366,000 $669,000 $303,000
$366,000
The following cost data pertain to the operations of Bouffard Department Stores, Inc., for the month of May. Corporate legal office salaries $68,000 Shoe Department cost of sales-Brentwood Store $29,000 Corporate headquarters building lease $86,000 Store manager's salary-Brentwood Store $12,000 Shoe Department sales commissions-Brentwood Store $5,000 Store utilities-Brentwood Store $10,000 Shoe Department manager's salary-Brentwood Store $4,000 Central warehouse lease cost $7,000 Janitorial costs-Brentwood Store $10,000 The Brentwood Store is just one of many stores owned and operated by the company. The Shoe Department is one of many departments at the Brentwood Store. The central warehouse serves all of the company's stores. What is the total amount of the costs listed above that are direct costs of the Shoe Department? $38,000 $29,000 $70,000 $34,000
$38,000
Comparative income statements for Tudor Retailing Company for the last two months are presented below: September October Sales in units 5,000 7,000 Sales revenue $100,000 $140,000 Cost of goods sold 40,000 56,000 Gross margin 60,000 84,000 Selling and administrative expenses: Shipping expense 7,500 10,500 Clerical expense 10,000 12,000 Maintenance expense 17,000 17,000 Total selling and administrative expense 34,500 39,500 Net operating income $25,500 $44,500 If the Tudor Retailing Company uses the high-low method of analysis, the total selling and administrative expense if Tudor Retailing Company sells 6,500 units during a month would be estimated to be: $37,000 $44,850 $38,250 $36,679
$38,250
The following production and average cost data for two levels of monthly production volume have been supplied by a company that produces a single product: Production volume 1,000 units 3,000 units Direct materials $13.20 per unit $13.20 per unit Direct labor $14.50 per unit $14.50 per unit Manufacturing overhead $65.40 per unit $29.40 per unit The best estimate of the total variable manufacturing cost per unit is: $39.10 $27.70 $11.40 $13.20
$39.10
Callis Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $141.60 per unit. Sales volume (units) 5,000 6,000 Cost of sales $265,500 $318,600 Selling and administrative costs $393,500 $406,800 The best estimate of the total contribution margin when 5,300 units are sold is: $51,940 $469,050 $109,710 $398,560
$398,560
Nieman Inc., a local retailer, has provided the following data for the month of March: Merchandise inventory, beginning balance $30,000 Merchandise inventory, ending balance $34,000 Sales $280,000 Purchases of merchandise inventory $146,000 Selling expense $27,000 Administrative expense $64,000 The net operating income for March was: $130,000 $134,000 $43,000 $47,000
$47,000
Farnor, Inc., would like to estimate the variable and fixed components of its electrical costs and has compiled the following data for the last four months of operations. Machine Hours Electrical Cost January 30 $75 February 42 $90 March 35 $81 April 20 $68 Using the high-low method of analysis, the estimated fixed cost per month for electricity is closest to: $53.46 $0.00 $3.40 $48.00
$48.00
Frank Company operates a cafeteria for its employees. The number of meals served each week over the last seven weeks, along with the total costs of operating the cafeteria are given below: Meals served Cafeteria costs Week 1 1,500 $4,800 Week 2 1,600 $5,080 Week 3 1,800 $5,280 Week 4 1,450 $4,900 Week 5 1,200 $4,000 Week 6 1,650 $5,100 Week 7 1,900 $5,400 Assume that the relevant range includes all of the activity levels mentioned in this problem. Assume that the cafeteria expects to serve 1,850 meals during Week 8. Using the high-low method, the expected total cost of the cafeteria would be: $5,340 $5,180 $5,300 $4,375
$5,300
Electrical costs at one of Reifel Corporation's factories are listed below: Machine-Hours Electrical Cost March 413 $7,371 April 506 $7,740 May 435 $7,447 June 486 $7,660 July 499 $7,704 August 461 $7,563 September 467 $7,571 October 458 $7,522 November 425 $7,403 Management believes that electrical cost is a mixed cost that depends on machine-hours. Using the high-low method, the estimate of the fixed component of electrical cost per month is closest to: $7,371 $5,731 $5,875 $5,840
$5,731
The following costs were incurred in April: Direct materials $29,000 Direct labor $24,000 Manufacturing overhead $14,000 Selling expenses $18,000 Administrative expenses $18,000 Prime costs during the month totaled: $53,000 $67,000 $38,000 $103,000
$53,000
Searls Corporation, a merchandising company, reported the following results for July: Number of units sold 2,700 units Selling price per unit $664 per unit Unit cost of goods sold $405 per unit Variable selling expense per unit $48 per unit Total fixed selling expense $56,500 Variable administrative expense per unit $13 per unit Total fixed administrative expense $118,200 Cost of goods sold is a variable cost in this company. The contribution margin for July is: $534,600 $699,300 $359,900 $1,453,400
$534,600
The following costs were incurred in April: Direct materials $18,000 Direct labor $21,000 Manufacturing overhead $33,000 Selling expenses $14,000 Administrative expenses $19,000 Conversion costs during the month totaled:
$54,000
The following production and average cost data for two levels of monthly production volume have been supplied by a company that produces a single product: Production volume 1,000 units 3,000 units Direct materials $13.20 per unit $13.20 per unit Direct labor $14.50 per unit $14.50 per unit Manufacturing overhead $65.40 per unit $29.40 per unit The best estimate of the total monthly fixed manufacturing cost is: $65,400 $88,200 $93,100 $54,000
$54,000
Data concerning Nelson Company's activity for the first six months of the year appear below: Machine Hours Electrical Cost January 4,000 $3,120 February 6,000 $4,460 March 4,800 $3,500 April 3,800 $3,040 May 3,600 $2,900 June 4,200 $3,200 Using the high-low method of analysis, the estimated monthly fixed component of the electrical cost is: $1,520 $440 $260 $560
$560
A manufacturing company prepays its insurance coverage for a three-year period. The premium for the three years is $2,400 and is paid at the beginning of the first year. Seventy percent of the premium applies to manufacturing operations and thirty percent applies to selling and administrative activities. What amounts should be considered product and period costs respectively for the first year of coverage? Product = ? Period = ?
$560, $240
A partial listing of costs incurred at Gilhooly Corporation during September appears below: Direct materials $183,000 Utilities, factory $9,000 Administrative salaries $90,000 Indirect labor $25,000 Sales commissions $33,000 Depreciation of production equipment $25,000 Depreciation of administrative equipment $32,000 Direct labor $124,000 Advertising $148,000 The total of the manufacturing overhead costs listed above for September is: $669,000 $366,000 $34,000 $59,000
$59,000
Oaklis Company has provided the following data for maintenance cost: Prior Year Current Year Machine hours 10,000 12,000 Maintenance cost $24,000 $27,600 Maintenance cost is a mixed cost with variable and fixed components. The fixed and variable components of maintenance cost are closest to: $24,000 per year; $2.30 per machine hour $6,000 per year; $1.80 per machine hour $6,000 per year; $2.30 per machine hour $24,000 per year; $1.80 per machine hour
$6,000 per year; $1.80 per machine hour
Haab Inc. is a merchandising company. Last month the company's cost of goods sold was $66,000. The company's beginning merchandise inventory was $17,000 and its ending merchandise inventory was $11,000. What was the total amount of the company's merchandise purchases for the month? $72,000 $66,000 $94,000 $60,000
$60,000
Baker Corporation has provided the following production and total cost data for two levels of monthly production volume. The company produces a single product. Production volume 6,000 units 7,000 units Direct materials $194,400 $226,800 Direct labor $74,400 $86,800 Manufacturing overhead $758,400 $779,800 The best estimate of the total monthly fixed manufacturing cost is: $1,027,200 $1,060,300 $1,093,400 $630,000
$630,000
Gabat Inc. is a merchandising company. Last month the company's merchandise purchases totaled $67,000. The company's beginning merchandise inventory was $19,000 and its ending merchandise inventory was $22,000. What was the company's cost of goods sold for the month? $108,000 $67,000 $64,000 $70,000
$64,000
Baker Corporation has provided the following production and total cost data for two levels of monthly production volume. The company produces a single product. Production volume 6,000 units 7,000 units Direct materials $194,400 $226,800 Direct labor $74,400 $86,800 Manufacturing overhead $758,400 $779,800 The best estimate of the total variable manufacturing cost per unit is: $32.40 $44.80 $66.20 $21.40
$66.20
Callis Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $141.60 per unit. Sales volume (units) 5,000 6,000 Cost of sales $265,500 $318,600 Selling and administrative costs $393,500 $406,800 The best estimate of the total variable cost per unit is: $131.80 $53.10 $66.40 $120.90
$66.40
Harris Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $84.40 per unit. Sales volume (units) 5,000 6,000 Cost of sales $285,000 $342,000 Selling and administrative costs $107,500 $120,000 The best estimate of the total variable cost per unit is: $77.00 $57.00 $69.50 $78.50
$69.50
Searls Corporation, a merchandising company, reported the following results for July: Number of units sold 2,700 units Selling price per unit $664 per unit Unit cost of goods sold $405 per unit Variable selling expense per unit $48 per unit Total fixed selling expense $56,500 Variable administrative expense per unit $13 per unit Total fixed administrative expense $118,200 Cost of goods sold is a variable cost in this company. The gross margin for July is: $1,618,100 $699,300 $359,900 $534,600
$699,300
Inspection costs at one of Iuliano Corporation's factories are listed below: Units Produced Inspection Cost February 905 $16,212 March 949 $16,600 April 911 $16,265 May 895 $16,110 June 917 $16,294 July 902 $16,180 August 919 $16,332 September 859 $15,760 October 898 $16,138 Management believes that inspection cost is a mixed cost that depends on units produced. Using the high-low method, the estimate of the fixed component of inspection cost per month is closest to: $16,210 $7,746 $15,761 $16,111
$7,746
Electrical costs at one of Kantola Corporation's factories are listed below: Machine-Hours Electrical Cost February 3,570 $36,405 March 3,580 $36,493 April 3,553 $36,302 May 3,627 $36,833 June 3,625 $36,800 July 3,565 $36,366 August 3,548 $36,237 September 3,542 $36,213 October 3,593 $36,577 Management believes that electrical cost is a mixed cost that depends on machine-hours. Use the high-low method to estimate the variable and fixed components of this cost. Compute the variable component first, rounding off to the nearest whole cent. Then compute the fixed component, rounding off to the nearest whole dollar. Those estimates are closest to: $0.14 per machine-hour; $36,336 per month $10.19 per machine-hour; $36,470 per month $7.48 per machine-hour; $9,708 per month $7.29 per machine-hour; $10,392 per month
$7.29 per machine-hour; $10,392 per month
Maintenance costs at a Whetsel Corporation factory are listed below: Machine-Hours Maintenance Cost March 3,135 $48,340 April 3,095 $47,993 May 3,133 $48,345 June 3,157 $48,548 July 3,065 $47,733 August 3,076 $47,830 September 3,084 $47,880 October 3,125 $48,247 November 3,098 $48,014 Management believes that maintenance cost is a mixed cost that depends on machine-hours. Use the high-low method to estimate the variable and fixed components of this cost. Compute the variable component first and round off to the nearest whole cent. Compute the fixed component second and round off to the nearest whole dollar. These estimates would be closest to: $8.86 per machine-hour; $20,577 per month $0.11 per machine-hour; $48,192 per month $15.48 per machine-hour; $48,103 per month $8.81 per machine-hour; $20,718 per month
$8.86 per machine-hour; $20,577 per month
Baker Corporation has provided the following production and average cost data for two levels of monthly production volume. The company produces a single product. Production volume 1,000 units 3,000 units Direct materials $30.90 per unit $30.90 per unit Direct labor $40.20 per unit $40.20 per unit Manufacturing overhead $64.60 per unit $33.80 per unit The best estimate of the total variable manufacturing cost per unit is:
$89.50
Abbott Company's manufacturing overhead is 20% of its total conversion costs. If direct labor is $38,000 and if direct materials are $23,000, the manufacturing overhead is: $9,500 $152,000 $5,750 $15,250
$9,500
Cardillo Inc., an escrow agent, has provided the following data concerning its office expenses: Escrows Completed Office Expenses January 99 $13,181 February 111 $13,598 March 129 $14,239 April 133 $14,357 May 152 $15,095 June 104 $13,335 July 118 $13,847 August 100 $13,211 September 103 $13,283 Management believes that office expense is a mixed cost that depends on the number of escrows completed. Note: Real estate purchases usually involve the services of an escrow agent that holds funds and prepares documents to complete the transaction. Using the high-low method, the estimate of the fixed component of office expense per month is closest to: $9,606 $13,485 $13,181 $13,793
$9,606
Inspection costs at one of Iuliano Corporation's factories are listed below: Units Produced Inspection Cost February 905 $16,212 March 949 $16,600 April 911 $16,265 May 895 $16,110 June 917 $16,294 July 902 $16,180 August 919 $16,332 September 859 $15,760 October 898 $16,138 Management believes that inspection cost is a mixed cost that depends on units produced. Using the high-low method, the estimate of the variable component of inspection cost per unit produced is closest to: $10.57 $0.11 $17.89 $9.33
$9.33
Cardiv Corporation has provided the following production and average cost data for two levels of monthly production volume. The company produces a single product. Production volume 4,000 units 5,000 units Direct materials $85.80 per unit $85.80 per unit Direct labor $56.10 per unit $56.10 per unit Manufacturing overhead $73.60 per unit $62.10 per unit The best estimate of the total cost to manufacture 4,300 units is closest to: $877,200 $909,400 $901,925 $926,650
$909,400
The following cost data pertain to the operations of Rademaker Department Stores, Inc., for the month of March. Corporate headquarters building lease $80,000 Cosmetics Department sales commissions-Northridge Store $7,000 Corporate legal office salaries $75,000 Store manager's salary-Northridge Store $11,000 Heating-Northridge Store $11,000 Cosmetics Department cost of sales-Northridge Store $83,000 Central warehouse lease cost $17,000 Store security-Northridge Store $11,000 Cosmetics Department manager's salary-Northridge Store $4,000 The Northridge Store is just one of many stores owned and operated by the company. The Cosmetics Department is one of many departments at the Northridge Store. The central warehouse serves all of the company's stores. What is the total amount of the costs listed above that are direct costs of the Cosmetics Department? $83,000 $94,000 $90,000 $127,000
$94,000
In April direct labor was 70% of conversion cost. If the manufacturing overhead for the month was $42,000 and the direct materials cost was $28,000, the direct labor cost was: $98,000 $65,333 $18,000 $12,000
$98,000
Werner Brothers, Inc., used the high-low method to derive its cost formula for electrical power cost. According to the cost formula, the variable cost per unit of activity is $2 per machine-hour. Total electrical power cost at the high level of activity was $9,400 and at the low level of activity was $9,000. If the high level of activity was 2,200 machine hours, then the low level of activity was: 1,800 machine hours 1,900 machine hours 2,000 machine hours 1,700 machine hours
2,000 machine hours
Indirect labor is a(n): Prime cost. Conversion cost. Period cost. Opportunity cost.
Conversion cost.
Corcetti Company manufactures and sells prewashed denim jeans. Large rolls of denim cloth are purchased and are first washed in a giant washing machine. After the cloth is dried, it is cut up into jean pattern shapes and then sewn together. The completed jeans are sold to various retail chains. Which of the following terms could be used to correctly describe the cost of the soap used to wash the denim cloth? Direct Cost: Product Cost:
No Yes
The cost of direct materials cost is classified as a: Period cost? Product cost?
No Yes
The property taxes on a factory building would be an example of: Prime cost? Conversion cost?
No Yes
Which of the following costs is classified as a prime cost? Direct materials? Indirect materials?
No Yes
The following data pertains to activity and utility cost for two recent periods: Activity level (units) 8,000 5,000 Utility cost $8,000 $6,150 Utility cost is a mixed cost with both fixed and variable components. Using the high-low method, the cost formula for utility cost is: Y = $1.00 X Y = $1.25 X Y = $4,000 + $0.50 X Y = $1,500 + $1.25 X
Y = $4,000 + $0.50 X
The following data pertains to activity and maintenance cost for two recent periods: Activity level (units) 5,000 4,000 Maintenance cost $16,750 $15,000 Maintenance cost is a mixed cost with both fixed and variable components. Using the high-low method, the cost formula for maintenance cost is: Y = $8,000 + $1.75 X Y = $3.75 X Y = $1,750 + $3.35 X Y = $3.35 X
Y = $8,000 + $1.75 X
Corcetti Company manufactures and sells prewashed denim jeans. Large rolls of denim cloth are purchased and are first washed in a giant washing machine. After the cloth is dried, it is cut up into jean pattern shapes and then sewn together. The completed jeans are sold to various retail chains. Which of the following terms could be used to correctly describe the cost of the thread used to sew the jeans together? Manufacturing Overhead Cost Fixed Cost A) Yes Yes B) Yes No C) No Yes D) No No Option A Option B Option C Option D
Yes No
Property taxes on a manufacturing facility are classified as: Conversion cost? Period cost?
Yes No
The nursing station on the fourth floor of Central Hospital is responsible for the care of orthopedic surgery patients. The costs of prescription drugs administered by the nursing station to patients should be classified as: direct patient costs. indirect patient costs. overhead costs of the nursing station. period costs of the hospital.
direct patient costs.
Fresh Wreath Corporation manufactures wreaths according to customer specifications and ships them to customers using United Parcel Service (UPS). Which two terms below describe the cost of shipping these wreaths? variable cost and product cost variable cost and period cost fixed cost and product cost fixed cost and period cost
variable cost and period cost