Preston Racquets manufactures tennis racquets.The following data are available for last month. \[\begin{array} { | l | r | } \hline \text { Units in bepinging inventory } & 0 \\ \hline \text { Units produced during year } & 1,200 \text { racquets } \\ \hline \text { Units in ending inventory } & \text { 200 racquets } \\ \hline \text { Sales comrissions per racquet } & \$ 10.00 \\ \hline \text { Fixed manufacturing coverhead } & \$ 48,000 \\ \hline \text { Fixed marketing expenses } & \$ 12,000 \\ \hline \text { Selling price per racquet } & \$ 200 \\ \hline \text { Variable manufacturing cost per racquet } & \$ 110 \\ \hline \end{array}\] -Using absorption costing,what is operating income for last month?

A) $200,000 B) $ 72,000 C) $ 28,000 D) $328,000 A) $200,000 B) $ 72,000 C) $ 28,000 D) $328,000

Jeppson Company manufactures computer hard drives.The following data is related to sales and production of the computer hard drives for last year. $\begin{array}{|l|c|} \hline \text { Selling price per unit } & \$ 100.00 \\ \hline \text { Variable manufacturing costs per unit } & \$ 45.00 \\ \hline \text { Variable selling and administrative expenses per unit } &\$ 6.00 \\ \hline \text { Fixed manufacturing overhead (in total) } & \$ 30,000 \\ \hline \text { Fixed selling and administrative expenses (in total) } & \$ 8,000 \\ \hline \text { Units produced during year } & 1,500 \\ \hline \text { Units sold during year } & 1,200 \\ \hline\text { Units in beginning inventory }&0\\ \hline \end{array}$ -Using absorption costing,what is cost of goods available for sale for last month?

A) $ 97,500 B) $ 78,000 C) $120,000 D) $ 30,000 A) $ 97,500 B) $ 78,000 C) $120,000 D) $ 30,000

Preston Racquets manufactures tennis racquets.The following data are available for last month. \[\begin{array} { | l | r | } \hline \text { Units in bepinging inventory } & 0 \\ \hline \text { Units produced during year } & 1,200 \text { racquets } \\ \hline \text { Units in ending inventory } & \text { 200 racquets } \\ \hline \text { Sales comrissions per racquet } & \$ 10.00 \\ \hline \text { Fixed manufacturing coverhead } & \$ 48,000 \\ \hline \text { Fixed marketing expenses } & \$ 12,000 \\ \hline \text { Selling price per racquet } & \$ 200 \\ \hline \text { Variable manufacturing cost per racquet } & \$ 110 \\ \hline \end{array}\] -Using variable costing,what is the contribution margin for last month?

A) $200,000 B) $110,000 C) $320,000 D) $80,000 A) $200,000 B) $110,000 C) $320,000 D) $80,000

To follow is information about the units produced and total manufacturing costs for Snow Enterprises for the past six months. \[\begin{array} { | l | c | c | } \hline \text { Month } & \text { Number of units produced } & \text { Total manufacturing costs } \\ \hline \text { January } & 7,940 & \$ 5,900 \\ \hline \text { February } & 7,500 & \$ 5,460 \\ \hline \text { March } & 6,400 & \$ 5,000 \\ \hline \text { April } & 6,600 & \$ 5,500 \\ \hline \text { May } & 4,740 & \$ 5,100 \\ \hline \text { June } & 7,800 & \$ 5,840 \\ \hline \end{array}\] -Using the high-low method,what is the monthly fixed manufacturing cost?

A) $ 800 B) $11,000 C) $ 3,915 D) $ 1,985 A) $ 800 B) $11,000 C) $ 3,915 D) $ 1,985

Preston Racquets manufactures tennis racquets.The following data are available for last month. \[\begin{array} { | l | r | } \hline \text { Units in bepinging inventory } & 0 \\ \hline \text { Units produced during year } & 1,200 \text { racquets } \\ \hline \text { Units in ending inventory } & \text { 200 racquets } \\ \hline \text { Sales comrissions per racquet } & \$ 10.00 \\ \hline \text { Fixed manufacturing coverhead } & \$ 48,000 \\ \hline \text { Fixed marketing expenses } & \$ 12,000 \\ \hline \text { Selling price per racquet } & \$ 200 \\ \hline \text { Variable manufacturing cost per racquet } & \$ 110 \\ \hline \end{array}\] -Using variable costing,what is the operating income for last month?

A) $200,000 B) $ 80,000 C) $ 20,000 D) $140,000 A) $200,000 B) $ 80,000 C) $ 20,000 D) $140,000

Exam 6: Cost Behavior

Preston Racquets manufactures tennis racquets.The following data are available for last month. Units in bepinging inventory 0 Units produced during year 1,200 racquets Units in ending inventory 200 racquets Sales comrissions per racquet \ 10.00 Fixed manufacturing coverhead \ 48,000 Fixed marketing expenses \ 12,000 Selling price per racquet \ 200 Variable manufacturing cost per racquet \ 110 -Using absorption costing,what is operating income for last month?

(Multiple Choice)

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Question 221

If a scatter plot reveals a fairly weak relationship between cost and volume,the cost equation based on that data should be very useful for predicting future costs.

(True/False)

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Question 222

When performing account analysis,managers decide how to classify each account as a variable,fixed or mixed cost.

(True/False)

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Question 223

Jeppson Company manufactures computer hard drives.The following data is related to sales and production of the computer hard drives for last year. Selling price per unit \ 100.00 Variable manufacturing costs per unit \ 45.00 Variable selling and administrative expenses per unit \ 6.00 Fixed manufacturing overhead (in total) \ 30,000 Fixed selling and administrative expenses (in total) \ 8,000 Units produced during year 1,500 Units sold during year 1,200 Units in beginning inventory 0 -Using absorption costing,what is cost of goods available for sale for last month?

(Multiple Choice)

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Question 224

Preston Racquets manufactures tennis racquets.The following data are available for last month. Units in bepinging inventory 0 Units produced during year 1,200 racquets Units in ending inventory 200 racquets Sales comrissions per racquet \ 10.00 Fixed manufacturing coverhead \ 48,000 Fixed marketing expenses \ 12,000 Selling price per racquet \ 200 Variable manufacturing cost per racquet \ 110 -Using variable costing,what is the contribution margin for last month?

(Multiple Choice)

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Question 225

To follow is information about the units produced and total manufacturing costs for Snow Enterprises for the past six months. Month Number of units produced Total manufacturing costs January 7,940 \ 5,900 February 7,500 \ 5,460 March 6,400 \ 5,000 April 6,600 \ 5,500 May 4,740 \ 5,100 June 7,800 \ 5,840 -Using the high-low method,what is the monthly fixed manufacturing cost?

(Multiple Choice)

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Question 226

Under absorption costing,fixed manufacturing costs are not expensed until the units are sold.

(True/False)

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Question 227

If inventory has declined,operating income will be higher under variable costing than it is under absorption costing.

(True/False)

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Question 228

Which of the following statements is TRUE with respect to total variable costs?

(Multiple Choice)

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Question 229

Using account analysis,what type of cost is the rental of a space at $2,000 per month?

(Multiple Choice)

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Question 230

Which type of costing system is required for external financial reporting?

(Multiple Choice)

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Question 231

The representation for fixed cost per unit of activity is:

(Multiple Choice)

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Question 232

Unit variable costs change as total production increases.

(True/False)

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Question 233

Preston Racquets manufactures tennis racquets.The following data are available for last month. Units in bepinging inventory 0 Units produced during year 1,200 racquets Units in ending inventory 200 racquets Sales comrissions per racquet \ 10.00 Fixed manufacturing coverhead \ 48,000 Fixed marketing expenses \ 12,000 Selling price per racquet \ 200 Variable manufacturing cost per racquet \ 110 -Using variable costing,what is the operating income for last month?

(Multiple Choice)

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Question 234

Total fixed costs for Excelsior Corporation are $600,000.Total costs,both fixed and variable,are $750,000 if 125,000 units are produced.The fixed cost per unit at 300,000 units would be:

(Multiple Choice)

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Question 235

Total fixed costs can be expressed as y = vx,where y = total variable cost,v= variable cost per unit of activity,and x = volume of activity.

(True/False)

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Question 236

When a company produces more units than it sells,absorption costing operating income will be less than variable costing operating income.

(True/False)

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Question 237

A regression equation's "goodness of fit" is represented by the__________ on the regression analysis output.

(Multiple Choice)

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Question 238

The manager at Copley Mulch has been trying to calculate the portion of the company's overhead expenses that is fixed and the portion that is variable.Over the past twelve months,the number of yards of mulch processed was highest in July,when the total monthly overhead costs totaled $6,000 for 25,000 yards of mulch processed.The lowest number of yards of mulch processed in the last twelve months occurred in October,when total overhead costs were $4,000 for 15,000 yards of mulch processed. -What is the fixed portion of the monthly overhead expenses?

(Multiple Choice)

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Question 239

When graphing total mixed costs,the cost line always begins at the origin.

(True/False)

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Question 240

If a scatter plot reveals a fairly weak relationship between cost and volume,the cost equation based on that data should be very useful for predicting future costs.

When performing account analysis,managers decide how to classify each account as a variable,fixed or mixed cost.

Under absorption costing,fixed manufacturing costs are not expensed until the units are sold.

If inventory has declined,operating income will be higher under variable costing than it is under absorption costing.

Which of the following statements is TRUE with respect to total variable costs?

Using account analysis,what type of cost is the rental of a space at $2,000 per month?

Which type of costing system is required for external financial reporting?

The representation for fixed cost per unit of activity is:

Unit variable costs change as total production increases.

Total fixed costs for Excelsior Corporation are $600,000.Total costs,both fixed and variable,are $750,000 if 125,000 units are produced.The fixed cost per unit at 300,000 units would be:

Total fixed costs can be expressed as y = vx,where y = total variable cost,v= variable cost per unit of activity,and x = volume of activity.

When a company produces more units than it sells,absorption costing operating income will be less than variable costing operating income.

A regression equation's "goodness of fit" is represented by the__________ on the regression analysis output.

When graphing total mixed costs,the cost line always begins at the origin.

Introduction to Managerial Accounting

Building Blocks of Managerial Accounting

Job Costing

Activity-Based Costing, lean Production, and the Costs of Quality

Process Costing

Cost-Volume-Profit Analysis

Short Term Business Decisions

The Master Budget and Responsibility Accounting

Flexible Budgets and Standard Costs

Performance Evaluation and the Balanced Scorecard

Capital Investment Decisions and the Time Value of Money

Statement of Cash Flows

Financial Statement Analysis

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