Exam 3: Cost Behaviour

Which of the following costs is the least likely to be classified as a fixed cost?

Preferred Products has the following cost information available for 2009: Direct materials \ 4.00 per unit Direct labour \ 3.00 per unit Variable manufacturing overhead \ 2.00 per unit Variable selling and administrative costs \ 1.00 per unit Fixed manufacturing overhead \ 25000 Fixed selling and administrative costs \ 10000 During 2009,Preferred produced 5000 units out of which 4600 units were sold for $30 each. Required: A. Calculate Preferred's net income assuming the company uses variable costing. B. Calculate Preferred's net income assuming the company uses absorption costing

Mr. Quik Printers Mr. Quik Printers documented the number of copies it made for customers as well as total overhead costs for the past five months as follows: Number of copies Total overhead costs October 230000 \ 7400 November 240000 7500 December 280000 8000 January 265000 7700 February 248000 7550 -Using the high/low method,what is the variable cost per unit?

For each of the following statements,fill in the blank with either the word increase,decrease,or stay the same. a.As production decreases,total fixed costs ______________. b.As production decreases,fixed costs per unit _____________. c.As production increases,variable costs per unit _____________. d.As production increases,total variable costs _______________.

Assuming that the number of units produced is less than the number of units sold,which of the following statements is true when comparing net income using absorption and variable costing?

Under absorption costing,which of the following is not considered a product cost?