Exam 6: Variable Costing and Segment Reporting: Tools for Management

Buckbee Corporation manufactures and sells one product. The following information pertains to the company's first year of operations: The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 37,000 units and sold 32,000 units. The company's only product is sold for $261 per unit.The unit product cost under super-variable costing is:

Letcher Corporation manufactures and sells one product. The following information pertains to the company's first year of operations: The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 44,700 units and sold 43,200 units. The company's only product is sold for $183 per unit.The company is considering using either super-variable costing or a variable costing system that assigns $21 of direct labor cost to each unit that is produced. Which of the following statements is true regarding the net operating income in the first year?

Badoni Corporation has provided the following data for its two most recent years of operation: The net operating income (loss) under variable costing in Year 2 is closest to:

Mandato Corporation has provided the following data for its two most recent years of operation: The net operating income (loss) under variable costing in Year 1 is closest to:

Leheny Corporation manufactures and sells one product. The following information pertains to the company's first year of operations: The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 55,000 units and sold 50,000 units. The company's only product is sold for $238 per unit.The net operating income for the year under super-variable costing is:

Krepps Corporation produces a single product. Last year, Krepps manufactured 28,000 units and sold 22,500 units. Production costs for the year were as follows: Sales totaled $1,046,250 for the year, variable selling and administrative expenses totaled $117,000, and fixed selling and administrative expenses totaled $201,600. There was no beginning inventory. Assume that direct labor is a variable cost.Under variable costing, the company's net operating income for the year would be:

Delisa Corporation has two divisions: Division L and Division Q. Data from the most recent month appear below: The break-even in sales dollars for Division Q is closest to:

Combe Corporation has two divisions: Alpha and Beta. Data from the most recent month appear below: The company's common fixed expenses total $94,500. The break-even in sales dollars for Alpha Division is closest to:

Buckbee Corporation manufactures and sells one product. The following information pertains to the company's first year of operations: The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 37,000 units and sold 32,000 units. The company's only product is sold for $261 per unit.The net operating income for the year under super-variable costing is:

Kaaua Corporation has provided the following data for its two most recent years of operation: Which of the following statements is true for Year 2?

Farris Corporation, which has only one product, has provided the following data concerning its most recent month of operations: What is the net operating income (loss) for the month under variable costing?

Silver Corporation produces a single product. Last year, the company's variable production costs totaled $7,500 and its fixed manufacturing overhead costs totaled $4,500. The company produced 3,000 units during the year and sold 2,400 units. There were no units in the beginning inventory. Which of the following statements is true?

Under variable costing, fixed manufacturing overhead is treated as a product cost.

Marcelin Corporation manufactures and sells one product. The following information pertains to the company's first year of operations: The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 51,000 units and sold 46,000 units. The company's only product is sold for $276 per unit.The unit product cost under super-variable costing is:

Hadley Corporation, which has only one product, has provided the following data concerning its most recent month of operations: What is the net operating income for the month under variable costing?

Davison Corporation, which has only one product, has provided the following data concerning its most recent month of operations: What is the total period cost for the month under the absorption costing?

Gabuat Corporation, which has only one product, has provided the following data concerning its most recent month of operations: The total gross margin for the month under the absorption costing approach is:

Plummer Corporation has provided the following data for its two most recent years of operation: The net operating income (loss) under absorption costing in Year 2 is closest to:

Buckbee Corporation manufactures and sells one product. The following information pertains to the company's first year of operations: The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 42,000 units and sold 38,000 units. The company's only product is sold for $230 per unit.The net operating income for the year under super-variable costing is:

Buckbee Corporation manufactures and sells one product. The following information pertains to the company's first year of operations: The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 37,000 units and sold 32,000 units. The company's only product is sold for $261 per unit.Assume that the company uses a variable costing system that assigns $17 of direct labor cost to each unit that is produced. The unit product cost under this costing system is: