Question 1

Which of the following will usually be found on an income statement prepared using absorption costing?

Accepted Answer

The answer of Which of the following will usually be...

Question 2

Hadley 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 variable costing?

Accepted Answer

A)  $75,500 
B)  $43,200 
C)  $55,700 
D)  $32,300 
A)  $75,500 
B)  $43,200 
C)  $55,700 
D)  $32,300

Question 3

Tat Corporation produces a single product and has the following cost structure:
  
-The unit product cost under absorption costing is:

Accepted Answer

A)  $247 per unit 
B)  $166 per unit 
C)  $332 per unit 
D)  $171 per unit 
A)  $247 per unit 
B)  $166 per unit 
C)  $332 per unit 
D)  $171 per unit

Question 4

Sherwood Corporation has provided the following data for its two most recent years of operation:
     Required:
a.Assume the company uses absorption costing.Compute the unit product cost in each year.
b.Assume the company uses variable costing.Compute the unit product cost in each year.
c.Assume the company uses absorption costing.Prepare an income statement for each year.
d.Assume the company uses variable costing.Prepare an income statement for each year.
e.Prepare a report in good form reconciling the variable costing and absorption costing net incomes.

Accepted Answer

a.Absorption costing unit product costs:

Question 5

A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations:
  The total contribution margin for the month under variable costing is:

Accepted Answer

A)  $64,200 
B)  $249,900 
C)  $225,400 
D)  $98,000 
A)  $64,200 
B)  $249,900 
C)  $225,400 
D)  $98,000

Question 6

The Carlsbad Corporation produces and markets two types of electronic calculators:
 Model 4A and Model 5A.The following data were gathered on activities during the third quarter:
   Required:
Prepare a segmented income statement for last quarter.The statement should provide sufficient detail to allow the company to evaluate the performance of the manager of each product line.

Accepted Answer

The answer of The Carlsbad Corporation produces and markets two...

Question 7

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

Accepted Answer

A)  $32 per unit 
B)  $61 per unit 
C)  $37 per unit 
D)  $66 per unit 
A)  $32 per unit 
B)  $61 per unit 
C)  $37 per unit 
D)  $66 per unit

Question 8

Aaron Corporation, which has only one product, has provided the following data concerning its most recent month of operations:
  
-What is the unit product cost for the month under variable costing?

Accepted Answer

A)  $69 per unit 
B)  $65 per unit 
C)  $85 per unit 
D)  $81 per unit 
A)  $69 per unit 
B)  $65 per unit 
C)  $85 per unit 
D)  $81 per unit

Question 9

Toxemia Salsa Corporation manufactures five flavors of salsa.Last year,Toxemia generated net operating income of $40,000.The following information was taken from last year's income statement segmented by flavor (brackets indicate a negative amount):
  Toxemia expects similar operating results for the upcoming year.If Toxemia wants to maximize its profitability in the upcoming year,which flavor or flavors should Toxemia discontinue?

Accepted Answer

A)  no flavors should be discontinued 
B)  Wimpy 
C)  Wimpy and Mild 
D)  Wimpy, Mild, and Medium 
A)  no flavors should be discontinued 
B)  Wimpy 
C)  Wimpy and Mild 
D)  Wimpy, Mild, and Medium

Question 10

Else Corporation has provided the following data for its two most recent years of operation:
     Required:
a.Assume the company uses absorption costing.Compute the unit product cost in each year.
b.Assume the company uses variable costing.Compute the unit product cost in each year.

Accepted Answer

a.Absorption costing

Question 11

Pavelko Corporation has provided the following data for its two most recent years of operation:
    
-The unit product cost under absorption costing in Year 1 is closest to:

Accepted Answer

A)  $38.00 
B)  $32.00 
C)  $23.00 
D)  $9.00 
A)  $38.00 
B)  $32.00 
C)  $23.00 
D)  $9.00

Question 12

Worrel Corporation manufactures a single product.The following data pertain to the company's operations over the last two years:
   Required:
a.Determine the absorption costing net operating income last year.Show your work!
b.Determine the absorption costing net operating income this year.Show your work!

Accepted Answer

The answer of Worrel Corporation manufactures a single product.The following...

Question 13

Neelon Corporation has two divisions: Southern Division and Northern Division. The following data are for the most recent operating period:
   The common fixed expenses have been allocated to the divisions on the basis of sales.
-What is the company's overall net operating income if it operates at the break-even points for its two divisions?

Accepted Answer

A)  $(79,420) 
B)  $21,700 
C)  $(265,420) 
D)  $0 
A)  $(79,420) 
B)  $21,700 
C)  $(265,420) 
D)  $0

Question 14

Krepps Corporation produces a single product. Last year, Krepps manufactured 20,000 units and sold 15,000 units. Production costs for the year were as follows:
   Sales totaled $825,000 for the year, variable selling and administrative expenses totaled $108,000, and fixed selling and administrative expenses totaled $165,000. There was no beginning inventory. Assume that direct labor is a variable cost.
-Under absorption costing,the ending inventory for the year would be valued at:

Accepted Answer

A)  $0 
B)  $216,000 
C)  $248,250 
D)  $180,000 
A)  $0 
B)  $216,000 
C)  $248,250 
D)  $180,000

Question 15

Segmented statements for internal use should not be prepared using the contribution format.

Accepted Answer

A) True 
 B)False

Question 16

Bryans 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:

Accepted Answer

A)  $146,000 
B)  $118,000 
C)  $47,000 
D)  $41,000 
A)  $146,000 
B)  $118,000 
C)  $47,000 
D)  $41,000

Question 17

Helmers Corporation manufactures a single product. Variable costing net operating income last year was $86,000 and this year was $103,000. Last year, $32,000 in fixed manufacturing overhead costs were released from inventory under absorption costing. This year, $12,000 in fixed manufacturing overhead costs were deferred in inventory under absorption costing.
-What was the absorption costing net operating income this year?

Accepted Answer

A)  $81,000 
B)  $83,000 
C)  $115,000 
D)  $123,000 
A)  $81,000 
B)  $83,000 
C)  $115,000 
D)  $123,000

Question 18

Data for January for Bondi Corporation and its two major business segments, North and South, appear below:
   In addition, common fixed expenses totaled $179,000 and were allocated as follows: $93,000 to the North business segment and $86,000 to the South business segment.
-A properly constructed segmented income statement in a contribution format would show that the net operating income of the company as a whole is:

Accepted Answer

A)  ($7,000) 
B)  $172,000 
C)  $351,000 
D)  $496,000 
A)  ($7,000) 
B)  $172,000 
C)  $351,000 
D)  $496,000

Question 19

Combe Corporation has two divisions: Alpha and Beta.Data from the most recent month appear below:
  The company's common fixed expenses total $80,800.The break-even in sales dollars for Alpha Division is closest to:

Accepted Answer

A)  $491,129 
B)  $143,478 
C)  $187,536 
D)  $260,580 
A)  $491,129 
B)  $143,478 
C)  $187,536 
D)  $260,580

Question 20

Carriveau Corporation has two divisions: Consumer Division and Business Division. The following data are for the most recent operating period:
   The company's common fixed expenses total $63,360.
-The company's overall break-even sales is closest to:

Accepted Answer

A)  $398,837 
B)  $288,296 
C)  $488,153 
D)  $89,316 
A)  $398,837 
B)  $288,296 
C)  $488,153 
D)  $89,316

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

Which of the following will usually be found on an income statement prepared using absorption costing?

Hadley 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 variable costing?

Tat Corporation produces a single product and has the following cost structure: -The unit product cost under absorption costing is:

A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations: The total contribution margin for the month under variable costing is:

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

Aaron Corporation, which has only one product, has provided the following data concerning its most recent month of operations: -What is the unit product cost for the month under variable costing?

Else Corporation has provided the following data for its two most recent years of operation: Required: a.Assume the company uses absorption costing.Compute the unit product cost in each year. b.Assume the company uses variable costing.Compute the unit product cost in each year.

Pavelko Corporation has provided the following data for its two most recent years of operation: -The unit product cost under absorption costing in Year 1 is closest to:

Segmented statements for internal use should not be prepared using the contribution format.

Bryans 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:

Combe Corporation has two divisions: Alpha and Beta.Data from the most recent month appear below: The company's common fixed expenses total $80,800.The break-even in sales dollars for Alpha Division is closest to:

Carriveau Corporation has two divisions: Consumer Division and Business Division. The following data are for the most recent operating period: The company's common fixed expenses total $63,360. -The company's overall break-even sales is closest to:

Managerial Accounting and Cost Concepts

Job-Order Costing: Calculating Unit Production Costs

Job-Order Costing: Cost Flows and External Reporting

Process Costing

Cost-Volume-Profit Relationships

Super-Variable Costing

Master Budgeting

Flexible Budgets and Performance Analysis

Standard Costs and Variances

Performance Measurement in Decentralized Organizations

Differential Analysis: The Key to Decision Making

Capital Budgeting Decisions

Statement of Cash Flows

Financial Statement Analysis

Cost of Quality

Activity-Based Absorption Costing

The Predetermined Overhead Rate and Capacity

Job-Order Costing: a Microsoft Excel-Based Approach

Fifo Method

Service Department Allocations

Analyzing Mixed Costs

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

Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

Standard Cost Systems: a Financial Reporting Perspective Using Microsoft Excel

Transfer Pricing

Service Department Charges

Pricing Decisions

The Concept of Present Value

Income Taxes and the Present Value Method

the Direct Method of Determining the Net Cash Provided by Operating Activities

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