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Exam 1: Managerial Accounting and Cost Concepts

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Question 81

True/False

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In account analysis,an account is classified as either variable or fixed based on an analyst's prior knowledge of how the cost in the account behaves.

A) True
B) False

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Question 82

Multiple Choice

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Depreciation on a personal computer used in the marketing department of a manufacturing company would be classified as:

A) a product cost that is fixed with respect to the company's output.
B) a period cost that is fixed with respect to the company's output.
C) a product cost that is variable with respect to the company's output.
D) a period cost that is variable with respect to the company's output.

E) B) and C)
F) C) and D)

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Question 83

Multiple Choice

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When the level of activity decreases within the relevant range,the fixed cost per unit will:

Glew Corporation has provided the following information: -If 3,000 units are produced,the total amount of indirect manufacturing cost incurred is closest to:

The cost of direct materials is classified as a:

Macy Corporation's relevant range of activity is 4,000 units to 8,000 units.When it produces and sells 6,000 units,its average costs per unit are as follows: If the selling price is $23.50 per unit,the contribution margin per unit sold is closest to:

In May direct labor was 60% of conversion cost.If the manufacturing overhead for the month was $54,000 and the direct materials cost was $30,000,the direct labor cost was:

Mark is an engineer who has designed a telecommunications device. He is convinced that there is a big potential market for the device. Accordingly, he has decided to quit his present job and start a company to manufacture and market the device. -Mark purchased a machine two years ago to make experimental boards.The machine will be used to manufacture the new board.The cost of this machine is:

The costs of direct materials are classified as:

Phaup 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: For financial reporting purposes,the total amount of period costs incurred to sell 5,000 units is closest to:

Traditional format income statements are widely used for preparing external financial statements.

A partial listing of costs incurred at Archut Corporation during September appears below: -The total of the product costs listed above for September is:

At an activity level of 6,800 units,Henkes Corporation's total variable cost is $125,188 and its total fixed cost is $164,152. Required: For the activity level of 7,100 units,compute: (a)the total variable cost; (b)the total fixed cost; (c)the total cost; (d)the average variable cost per unit; (e)the average fixed cost per unit; and (f)the average total cost per unit.Assume that this activity level is within the relevant range.

Perkey Corporation has provided the following information: If 4,000 units are produced,the total amount of direct manufacturing cost incurred is closest to:

The following data have been collected for four different cost items. Which of the following classifications of these cost items by cost behavior is correct?

Streif Inc., a local retailer, has provided the following data for the month of June: -The cost of goods sold for June was:

Karpowicz 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: Required: a.If the selling price is $21.40 per unit,what is the contribution margin per unit sold? b.If 8,000 units are produced,what is the total amount of direct manufacturing cost incurred? c.If 8,000 units are produced,what is the total amount of indirect manufacturing cost incurred? d.What incremental manufacturing cost will the company incur if it increases production from 9,000 to 9,001 units?

Fiori 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: The incremental manufacturing cost that the company will incur if it increases production from 5,000 to 5,001 units is closest to:

Wages paid to production supervisors would be classified as manufacturing overhead.

Kesterson Corporation has provided the following information: -If 6,000 units are produced,the total amount of indirect manufacturing cost incurred is closest to: