Question 1

The relevant range is the range of activity within which the assumption that cost behavior is strictly linear is reasonably valid.

Accepted Answer

A) True 
 B)False

Question 2

In April, Holderness Inc, a merchandising company, had sales of $221,000, selling expenses of $14,000, and administrative expenses of $25,000. The cost of merchandise purchased during the month was $155,000. The beginning balance in the merchandise inventory account was $34,000 and the ending balance was $48,000.
Required:
Prepare a traditional format income statement for April.

Accepted Answer

@#IMG-DLM& *Cost of goods sold = Beginni

Question 3

At an activity level of 8,400 units in a month, Braughton Corporation's total variable maintenance and repair cost is $697,284 and its total fixed maintenance and repair cost is $464,100. What would be the total maintenance and repair cost, both fixed and variable, at an activity level of 8,500 units in a month? Assume that this level of activity is within the relevant range. (Round intermediate calculations to 2 decimal places.)

Accepted Answer

A)  $1,175,210 
B)  $1,169,685 
C)  $1,161,384 
D)  $1,168,297 
A)  $1,175,210 
B)  $1,169,685 
C)  $1,161,384 
D)  $1,168,297

Question 4

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

Accepted Answer

A)  $53,400 
B)  $35,600 
C)  $36,600 
D)  $31,600 
A)  $53,400 
B)  $35,600 
C)  $36,600 
D)  $31,600

Question 5

Fasheh 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 10,000 units are produced, the average fixed manufacturing cost per unit produced is closest to:

Accepted Answer

A)  $15.00 
B)  $12.83 
C)  $13.50 
D)  $12.15 
A)  $15.00 
B)  $12.83 
C)  $13.50 
D)  $12.15

Question 6

All of the following can be differential costs except:

Accepted Answer

A)  variable costs. 
B)  sunk costs. 
C)  opportunity costs. 
D)  fixed costs. 
A)  variable costs. 
B)  sunk costs. 
C)  opportunity costs. 
D)  fixed costs.

Question 7

Oerther Corporation reports that at an activity level of 5,000 units, its total variable cost is $131,750 and its total fixed cost is $31,200. What would be the total variable cost at an activity level of 5,200 units? Assume that this level of activity is within the relevant range. (Round intermediate calculations to 2 decimal places.)

Accepted Answer

A)  $137,020 
B)  $131,750 
C)  $162,950 
D)  $32,448 
A)  $137,020 
B)  $131,750 
C)  $162,950 
D)  $32,448

Question 8

Shelp Corporation has provided the following information:   For financial reporting purposes, the total amount of period costs incurred to sell 9,000 units is closest to:

Accepted Answer

A)  $33,000 
B)  $9,000 
C)  $40,500 
D)  $49,500 
A)  $33,000 
B)  $9,000 
C)  $40,500 
D)  $49,500

Question 9

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

Accepted Answer

A)  $36,000 
B)  $119,000 
C)  $69,000 
D)  $46,000 
A)  $36,000 
B)  $119,000 
C)  $69,000 
D)  $46,000

Question 10

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:   For financial reporting purposes, the total amount of period costs incurred to sell 4,000 units is closest to:

Accepted Answer

A)  $7,800 
B)  $8,100 
C)  $4,400 
D)  $12,200 
A)  $7,800 
B)  $8,100 
C)  $4,400 
D)  $12,200

Question 11

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

Accepted Answer

A)  $73,200 
B)  $69,300 
C)  $86,400 
D)  $63,300 
A)  $73,200 
B)  $69,300 
C)  $86,400 
D)  $63,300

Question 12

Materials used in a factory that are not an integral part of the final product, such as cleaning supplies, should be classified as:

Accepted Answer

A)  direct materials. 
B)  a period cost. 
C)  administrative expense. 
D)  manufacturing overhead. 
A)  direct materials. 
B)  a period cost. 
C)  administrative expense. 
D)  manufacturing overhead.

Question 13

Glew Corporation has provided the following information:   For financial reporting purposes, the total amount of product costs incurred to make 4,000 units is closest to:

Accepted Answer

A)  $57,200 
B)  $8,800 
C)  $44,400 
D)  $53,200 
A)  $57,200 
B)  $8,800 
C)  $44,400 
D)  $53,200

Question 14

Advertising is not considered a product cost even if it promotes a specific product.

Accepted Answer

A) True 
 B)False

Question 15

Wessner Corporation has provided the following information:   The incremental manufacturing cost that the company will incur if it increases production from 4,000 to 4,001 units is closest to:

Accepted Answer

A)  $16.00 
B)  $14.05 
C)  $10.45 
D)  $13.45 
A)  $16.00 
B)  $14.05 
C)  $10.45 
D)  $13.45

Question 16

Which of the following statements about product costs is true?

Accepted Answer

A)  Product costs are deducted from revenue when the production process is completed. 
B)  Product costs are deducted from revenue as expenditures are made. 
C)  Product costs associated with unsold finished goods and work in process appear on the balance sheet as assets. 
D)  Product costs appear on financial statements only when products are sold. 
A)  Product costs are deducted from revenue when the production process is completed. 
B)  Product costs are deducted from revenue as expenditures are made. 
C)  Product costs associated with unsold finished goods and work in process appear on the balance sheet as assets. 
D)  Product costs appear on financial statements only when products are sold.

Question 17

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

Accepted Answer

A)  $33,300 
B)  $31,050 
C)  $28,050 
D)  $39,900 
A)  $33,300 
B)  $31,050 
C)  $28,050 
D)  $39,900

Question 18

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:

Accepted Answer

A)  $8,200 
B)  $12,250 
C)  $7,500 
D)  $4,750 
A)  $8,200 
B)  $12,250 
C)  $7,500 
D)  $4,750

Question 19

Cost behavior is considered curvilinear whenever a straight line is a reasonable approximation for the relation between cost and activity.

Accepted Answer

A) True 
 B)False

Question 20

Selling costs are indirect costs.

Accepted Answer

A) True 
 B)False

The relevant range is the range of activity within which the assumption that cost behavior is strictly linear is reasonably valid.

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

Fasheh 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 10,000 units are produced, the average fixed manufacturing cost per unit produced is closest to:

All of the following can be differential costs except:

Shelp Corporation has provided the following information: For financial reporting purposes, the total amount of period costs incurred to sell 9,000 units is closest to:

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

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: For financial reporting purposes, the total amount of period costs incurred to sell 4,000 units is closest to:

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

Materials used in a factory that are not an integral part of the final product, such as cleaning supplies, should be classified as:

Glew Corporation has provided the following information: For financial reporting purposes, the total amount of product costs incurred to make 4,000 units is closest to:

Advertising is not considered a product cost even if it promotes a specific product.

Wessner Corporation has provided the following information: The incremental manufacturing cost that the company will incur if it increases production from 4,000 to 4,001 units is closest to:

Which of the following statements about product costs is true?

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

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:

Cost behavior is considered curvilinear whenever a straight line is a reasonable approximation for the relation between cost and activity.

Selling costs are indirect costs.

Costvolumeprofit Relationships

Joborder Costing: Calculating Unit Product Costs

Variable Costing and Segment Reporting: Tools for Management

Activitybased Costing: a Tool to Aid Decision Making

Differential Analysis: the Key to Decision Making

Capital Budgeting Decisions

Master Budgeting

Flexible Budgets and Performance Analysis

Standard Costs and Variances

Performance Measurement in Decentralized Organizations

Cost of Quality

Analyzing Mixed Costs

Activity-Based Absorption Costing

the Predetermined Overhead Rate and Capacity

Super-Variable Costing

Time-Driven Activity-Based Costing: a Microsoft Excel-Based Approach

Pricing Decisions

the Concept of Present Value

Income Taxes and the Net Present Value Method

Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

Transfer Pricing

Service Department Charges

Filters

Exam 1: Managerial Accounting and Cost Concepts

The relevant range is the range of activity within which the assumption that cost behavior is strictly linear is reasonably valid.

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

Fasheh 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 10,000 units are produced, the average fixed manufacturing cost per unit produced is closest to:

All of the following can be differential costs except:

Shelp Corporation has provided the following information: For financial reporting purposes, the total amount of period costs incurred to sell 9,000 units is closest to:

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

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: For financial reporting purposes, the total amount of period costs incurred to sell 4,000 units is closest to:

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

Materials used in a factory that are not an integral part of the final product, such as cleaning supplies, should be classified as:

Glew Corporation has provided the following information: For financial reporting purposes, the total amount of product costs incurred to make 4,000 units is closest to:

Advertising is not considered a product cost even if it promotes a specific product.

Wessner Corporation has provided the following information: The incremental manufacturing cost that the company will incur if it increases production from 4,000 to 4,001 units is closest to:

Which of the following statements about product costs is true?

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

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:

Cost behavior is considered curvilinear whenever a straight line is a reasonable approximation for the relation between cost and activity.

Selling costs are indirect costs.

Costvolumeprofit Relationships

Joborder Costing: Calculating Unit Product Costs

Variable Costing and Segment Reporting: Tools for Management

Activitybased Costing: a Tool to Aid Decision Making

Differential Analysis: the Key to Decision Making

Capital Budgeting Decisions

Master Budgeting

Flexible Budgets and Performance Analysis

Standard Costs and Variances

Performance Measurement in Decentralized Organizations

Cost of Quality

Analyzing Mixed Costs

Activity-Based Absorption Costing

the Predetermined Overhead Rate and Capacity

Super-Variable Costing

Time-Driven Activity-Based Costing: a Microsoft Excel-Based Approach

Pricing Decisions

the Concept of Present Value

Income Taxes and the Net Present Value Method

Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

Transfer Pricing

Service Department Charges

Filters