Exam 2: An Introduction to Cost Terms and Purposes

Use the information below to answer the following question(s).The following information pertains to Payton's Shoe Manufacturing: 99,500 pairs of shoes are sold during the year for $18. -What is the amount of Payton's gross profit?

Answer the following question(s)using the information below.The West Company manufactures several different products.Unit costs associated with Product ORD203 are as follows: -What are the fixed costs per unit associated with Product ORD203?

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which are e listed below.Match the type of cost with the most appropriate cost pool or as a period cost. A)Period cost B)Cost pool - indirect factory operating costs C)Cost pool - indirect factory labour D)Cost pool - direct factory labour -fringe benefits for factory workers

Delivery charges are typically considered to be an indirect cost because it cannot be traced to each customer.

Use the information below to answer the following question(s).Big Island Coffee Co.produced and sold 120,000 units last year.Per unit revenue and costs were as follows: Fixed manufacturing overhead and administrative salaries are fixed costs.The per unit amounts are based on last year's production. -Which of the following statements about the key features of cost accounting and cost management is TRUE?

Answer the following question using the information below.Pederson Company reported the following: -What is the amount of finished goods inventory?

A new employee in the accounting department is having difficulty understanding two sets of accounting terms-variable and fixed costs as opposed to period and product costs.He understands that variable costs change during an accounting period while fixed costs do not.However, he explains that a period cost implies that it is for a period of time and is, therefore, also fixed.Does his assumption imply that all product costs are then variable? Required: As part of your responsibility to train new staff, explain the difference between these terms.

A unit cost is computed by dividing a total cost by some number of units.

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which are e listed below.Match the type of cost with the most appropriate cost pool or as a period cost. A)Period cost B)Cost pool - indirect factory operating costs C)Cost pool - indirect factory labour D)Cost pool - direct factory labour -property taxes on the administration office

Indirect costs cannot be economically traced directly to the cost objective.

Use the information below to answer the following question(s).Montreal Industries Inc.had the following activities during the year: -What is Montreal's cost of direct materials used during the year?

Sheen Manufacturing has four manufacturing cost pools and many types of costs, some of which are e listed below.Match the type of cost with the most appropriate cost pool or as a period cost. A)Period cost B)Cost pool - indirect factory operating costs C)Cost pool - indirect factory labour D)Cost pool - direct factory labour -factory worker overtime premiums

The following information pertains to Jan's Country Wood Shop: What is the cost of goods manufactured for 2019?

Helmer Sporting Goods Company manufactured 100,000 units in 2018 and reported the following costs: Required: a.What is the cost of direct materials used during 2018? b.What manufacturing costs were added to WIP during 2018? c.What is cost of goods manufactured for 2018? d.What is cost of goods sold for 2018?

Gimble Manufacturing Inc.makes vibration control springs for heating, ventilating, and air conditioning (HVAC)equipment.Materials cost $52 per spring set, and the machinists are paid $44 per hour.A machinist can produce four sets of springs per hour.Fixed manufacturing costs for springs are $5,000 per period.Non-manufacturing spring set costs are fixed at $11,000 per period.Each spring set sells for $75 and Gimble sells on average 4,000 spring sets per period.Required: a.Competition has entered the market and is selling spring sets for an introductory price of $66.Can Gimble Manufacturing Inc.meet this price and still make a profit? b.How would your answer to requirement a.change if Gimble sells on average 8,000 spring sets per period. c.What should Gimble Manufacturing Inc.'s management do in the short-run and for the long-term if it appears that $66 is going to be the new market price for the future.

Use the information below to answer the following question(s).Montreal Industries Inc.had the following activities during the year: -What is Montreal's cost of goods manufactured during the year?

Products, services, departments, and customers may be cost objects.

Answer the following question(s)using the information below.The following information pertains to Alleigh's Mannequins: -What is the amount of ending finished goods inventory?

Ames Power Point had sales in October of $28,000,000 for its three stores in Toronto.The beginning merchandise inventories for October and November were $5,000,000 and $4,000,000, respectively.October purchases totalled $19,000,000.All sales are on account (terms 2/15, net 30 days)and are collected 50 percent in the month of the sale and 50 percent in the following month.One-half of all sales discounts are taken for a total of $265,000.September sales totalled $25,000,000 while November sales were $30,000,000.Additional information for October is as follows: Required: Using an appropriately formatted income statement, determine the operating income of the company.

Actual costs are defined as