Managerial Accounting

The following budget and actual information is available for Carson City Co. for 2019: Budget----Actual Manufacturing overhead costs $480,000----$502,000 Direct labor dollars $588,600----$556,700 Direct labor hours 32,700----29,300 Carson City uses direct labor dollars as its allocation base. Under normal costing, what is the rate per labor dollar used to allocate overhead to work-in-progress inventory during the year, before year-end adjustment?

$0.82

Red Jeep Manufacturing currently produces 3,000 tires per month. The following per unit data for 3,000 tires applies to sales to regular customers: Direct materials----$38 Direct manufacturing labor----14 Variable manufacturing overhead----19 Fixed manufacturing overhead----20 Total----$91 Assume Red Jeep sells everything it produces. The plant is considering decreasing production to 2,000 tires. If Red Jeep reduces production to 2,000 tires, what is the new unit cost per tire?

$101

Which of the following types of companies would most likely use job costing?

A company that installs backyard swimming pools

Which of the following differentiates management accounting and financial accounting?

Management accounting measures, analyzes, and reports financial and nonfinancial information that helps managers make decisions to fulfill organizational goals, whereas financial accounting focuses on reporting financial information to external parties such as investors, governmental agencies, banks, and suppliers.

Different costs for different purposes means that

a company might consider costs in different ways depending on its objective.

Complete the following: With variable costs, total costs _________ with increases in output. With fixed costs, total costs _________ with increases in output.

increase; stay the same

For a company with diverse products, undercosting overhead of a product will lead to product-cross-subsidization which means that:

indirect costs of another product are also misallocated.

Normal costing systems are more commonly found in practice than actual costing systems because

normal costing systems provide a close approximation of the costs of various jobs regularly during the year, so that managers can make timely decisions.

All of the following are steps in the value chain except a. variance analysis. b. distribution. c. production. d. customer service.

variance analysis.

Little League, Inc. makes two kinds of baseball gloves - the Beginner and the Pro. Below is some relevant information for the past year (unit means one baseball glove): Beginner Pro Number of units sold65,00010,000Sales price per unit$65$100Direct materials per unit$10$20Direct labor dollars per unit$30$45Cutting machine-hours per unit0.501.00Direct labor-hours per unit2.003.00 Little League decides to break total indirect costs into two different cost pools, with corresponding cost-allocation bases: cutting costs of $255,000, with cutting machine-hours as the allocation base, and stitching costs of $360,000, with direct labor-hours as the allocation base. Using activity-based costing, what are the total indirect costs allocated to each Pro baseball glove?

$12.75

Reese, Inc. allocates overhead costs based on direct labor hours. Reese estimates manufacturing overhead costs and direct labor hours for the coming year to be $750,000 and 50,000, respectively. Actual labor hours for the year are 55,000. Job #16 uses 1,000 in labor hours, although the anticipated labor hours for Job #16 were only 900. The overhead costs allocated to Job #16 will be

$15,000.

Tiny's Toys has the following financial information for the month of July available: Revenues $300,000 Beginning Materials Inventory 20,000 Ending Materials Inventory 30,000 Beginning Work-in-Process Inventory 15,000 Ending Work-in-Process Inventory 17,000 Beginning Finished Goods Inventory 14,000 Ending Finished Goods Inventory 13,000 Purchase of Materials 115,000 Direct Labor 27,000 Manufacturing Overhead 33,000 Selling and Administrative Expenses 50,000 Based on the above, what is the cost of goods sold for July?

$164,000

During the Month of April, Sands Co. produces and sells 5,000 beach chairs. Its current factory equipment setup can produce up to 20,000 chairs per month. Sands is expecting an increase in demand because of the upcoming summer season - it expects to produce and sell 18,000 beach chairs in May. The information below is for the month of April. Costs have been labeled as either variable (V) or fixed (F). Information for April: Factory utilities (V) $11,000 Depreciation on factory equipment (F) 25,000 Rent on factory building (F) 12,000 Advertising costs (F) 6,000 Factory manager salary (F) 10,000 Direct factory labor (V) 30,000 Office salaries (F) 9,000 Insurance on factory building and equipment (F) 8,000 Direct materials used (V) 17,000 Indirect materials and supplies used in production (V) 4,000 Shipping costs to customers (V) 3,000 Other selling and administrative expenses (V) 2,000 Based on the information for April, how much would total inventoriable (manufacturing) costs be for May?

$278,200

Super Jack is a Magician who performs at birthday parties and other events. He has several packages available for party customers to choose from. Everyone starts with the basic magician package which is a flat fee of $300. From there, customers can add on either a value package (extra $100) or a deluxe package (extra $150) - both of these packages include extra, more impressive tricks. Super Jack also provides small goodie bags to guests, at a cost of $5 per guest. If customers request it, he can also provide light snacks and drinks at a cost of $3 per guest. He is hired in October to do a birthday party for 20 children. The family decides to add on the value package, plus goodie bags and snacks. What is the cost per child for the party?

$28

Sunset Swingsets builds customized backyard swingsets and uses a job costing system. Sunset allocates overhead costs based on direct labor hours. At the end of the year, the actual manufacturing overhead incurred is $475,000, and the manufacturing overhead allocated is $460,000. Before adjustment at year-end, Cost of Goods Sold has a balance of $950,000. If the over or underapplied overhead is written off to Cost of Goods Sold, the final balance in Cost of Goods Sold will be

$965,000.

Which of the following is an example of an indirect cost?

Security guard hourly wages for a plant that produces multiple products - Product B is the cost object.