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Exam 1: Managerial Accounting and Cost Concepts

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Question 111

True/False

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Opportunity costs at a manufacturing company are not part of manufacturing overhead.

A) True
B) False

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Question 112

Multiple Choice

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To the nearest whole dollar,what should be the total sales commissions at a sales volume of 18,400 units? (Assume that this sales volume is within the relevant range.)

A) $126,720
B) $132,000
C) $121,440
D) $143,478

E) A) and B)
F) A) and C)

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Question 113

Multiple Choice

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Mccaskell Corporation's relevant range of activity is 7,000 units to 11,000 units. When it produces and sells 9,000 units, its average costs per unit are as follows: -If 8,000 units are produced,the total amount of indirect manufacturing cost incurred is closest to:

Vignana Corporation manufactures and sells hand-painted clay figurines of popular sports heroes. Shown below are some of the costs incurred by Vignana for last year: -What is the total of the product costs above?

A merchandising company typically will have a high proportion of which type of cost in its cost structure?

A variable cost remains constant if expressed on a unit basis.

Arman Corporation's relevant range of activity is 3,000 units to 7,000 units.When it produces and sells 5,000 units,its average costs per unit are as follows: Required: a.If 6,000 units are produced,what is the total amount of fixed manufacturing cost incurred? b.If 6,000 units are produced,what is the total amount of manufacturing overhead cost incurred? What is this total amount expressed on a per unit basis? c.If 4,000 units are produced,what is the total amount of direct manufacturing cost incurred? d.If 4,000 units are produced,what is the total amount of indirect manufacturing cost incurred?

Meginnis Corporation's relevant range of activity is 3,000 units to 7,000 units.When it produces and sells 5,000 units,its average costs per unit are as follows: If 6,000 units are produced,the total amount of direct manufacturing cost incurred is closest to:

The relevant range concept is applicable to mixed costs.

Dake Corporation's relevant range of activity is 2,000 units to 6,000 units. When it produces and sells 4,000 units, its average costs per unit are as follows: -If 3,000 units are produced,the total amount of indirect manufacturing cost incurred is closest to:

Contribution format income statements are prepared primarily for external reporting purposes

Schwiesow Corporation has provided the following information: -For financial reporting purposes,the total amount of product costs incurred to make 5,000 units is closest to:

Wippert Corporation,a merchandising company,reported the following results for December: Required: a.Prepare a traditional format income statement for December. b.Prepare a contribution format income statement for December.

Delongis Corporation, a merchandising company, reported the following results for June: Cost of goods sold is a variable cost in this company. -The gross margin for June is:

Rhome Corporation's relevant range of activity is 2,000 units to 6,000 units. When it produces and sells 4,000 units, its average costs per unit are as follows: -If 5,000 units are produced,the average fixed manufacturing cost per unit produced is closest to:

In a traditional format income statement for a merchandising company,cost of goods sold is a variable cost that is included in the "Variable expenses" portion of the income statement.

Most companies use the contribution approach in preparing financial statements for external reporting purposes.

The following costs were incurred in May: Prime costs during the month totaled:

Fassino Corporation reported the following data for the month of November: -The prime cost for November was:

Wessner Corporation has provided the following information: -If 5,000 units are produced,the total amount of manufacturing overhead cost is closest to: