Question 1

The best estimate of the total contribution margin when 6,300 units are sold is:

Accepted Answer

A) $450,450 
B) $518,490 
C) $121,590 
D) $66,780 
A) $450,450 
B) $518,490 
C) $121,590 
D) $66,780

Question 2

The best estimate of the total variable manufacturing cost per unit is:

Accepted Answer

A) $22.10 
B) $66.70 
C) $88.80 
D) $15.70 
A) $22.10 
B) $66.70 
C) $88.80 
D) $15.70

Question 3

The following costs were incurred in September:   Conversion costs during the month totaled:

Accepted Answer

A) $50,000 
B) $59,000 
C) $137,000 
D) $67,000 
A) $50,000 
B) $59,000 
C) $137,000 
D) $67,000

Question 4

Bakker Corporation has provided the following production and average cost data for two levels of monthly production volume. The company produces a single product.   The best estimate of the total variable manufacturing cost per unit is:

Accepted Answer

A) $89.70 
B) $131.80 
C) $19.50 
D) $112.30 
A) $89.70 
B) $131.80 
C) $19.50 
D) $112.30

Question 5

An example of a committed fixed cost is:

Accepted Answer

A) a training program for salespersons. 
B) executive travel expenses. 
C) property taxes on the factory building. 
D) new product research and development. 
A) a training program for salespersons. 
B) executive travel expenses. 
C) property taxes on the factory building. 
D) new product research and development.

Question 6

The management of Harrigill Corporation would like to have a better understanding of the behavior of its inspection costs. The company has provided the following data:   Management believes that inspection cost is a mixed cost that depends on direct labor-hours.
Required:
Estimate the variable cost per direct labor-hour and the fixed cost per month using the high-low method. Show your work! Round off all calculations to the nearest whole cent.

Accepted Answer

@#IMG-DLM& Variable cost = Change in cost ÷ Change

Question 7

The following costs were incurred in September:   Prime costs during the month totaled:

Accepted Answer

A) $79,000 
B) $120,000 
C) $62,000 
D) $40,000 
A) $79,000 
B) $120,000 
C) $62,000 
D) $40,000

Question 8

Depreciation is always considered a product cost for external financial reporting purposes in a manufacturing firm.

Accepted Answer

A) True 
 B)False

Question 9

In making the decision to buy the model 240 machine rather than the model 370 machine, the sunk cost was:

Accepted Answer

A) $430,000 
B) $429,000 
C) $387,000 
D) $441,000 
A) $430,000 
B) $429,000 
C) $387,000 
D) $441,000

Question 10

The following data pertains to activity and costs for two months:   Assuming that these activity levels are within the relevant range, the mixed cost for July was:

Accepted Answer

A) $10,000 
B) $35,000 
C) $15,000 
D) $40,000 
A) $10,000 
B) $35,000 
C) $15,000 
D) $40,000

Question 11

The term differential cost refers to:

Accepted Answer

A) a difference in cost which results from selecting one alternative instead of another. 
B) the benefit forgone by selecting one alternative instead of another. 
C) a cost which does not involve any dollar outlay but which is relevant to the decision-making process. 
D) a cost which continues to be incurred even though there is no activity. 
A) a difference in cost which results from selecting one alternative instead of another. 
B) the benefit forgone by selecting one alternative instead of another. 
C) a cost which does not involve any dollar outlay but which is relevant to the decision-making process. 
D) a cost which continues to be incurred even though there is no activity.

Question 12

Automation results in a shift away from variable costs toward more fixed costs.

Accepted Answer

A) True 
 B)False

Question 13

What would be the average fixed cost per unit at an activity level of 3,500 units? Assume that this level of activity is within the relevant range.

Accepted Answer

A) $29.75 
B) $47.12 
C) $35.26 
D) $28.90 
A) $29.75 
B) $47.12 
C) $35.26 
D) $28.90

Question 14

In order for a cost to be variable it must vary with either units produced or units sold.

Accepted Answer

A) True 
 B)False

Question 15

What would be the total variable inspection cost at an activity level of 8,100 machine-hours in a month? Assume that this level of activity is within the relevant range.

Accepted Answer

A) $210,061 
B) $196,830 
C) $215,379 
D) $402,031 
A) $210,061 
B) $196,830 
C) $215,379 
D) $402,031

Question 16

When a decision is made among a number of alternatives, the benefit that is lost by choosing one alternative over another is the:

Accepted Answer

A) realized cost. 
B) opportunity cost. 
C) conversion cost. 
D) accrued cost. 
A) realized cost. 
B) opportunity cost. 
C) conversion cost. 
D) accrued cost.

Question 17

Given the cost formula, Y = $9,000 + $2.50X, total cost for an activity level of 3,000 units would be:

Accepted Answer

A) $9,750 
B) $12,000 
C) $16,500 
D) $7,500 
A) $9,750 
B) $12,000 
C) $16,500 
D) $7,500

Question 18

The gross margin for July is:

Accepted Answer

A) $358,500 
B) $209,000 
C) $233,700 
D) $164,700 
A) $358,500 
B) $209,000 
C) $233,700 
D) $164,700

Question 19

What is the total amount of the costs listed above that are direct costs of the Cosmetics Department?

Accepted Answer

A) $74,000 
B) $36,000 
C) $31,000 
D) $40,000 
A) $74,000 
B) $36,000 
C) $31,000 
D) $40,000

Question 20

Each of the following would be a period cost except:

Accepted Answer

A) the salary of the company president's secretary. 
B) the cost of a general accounting office. 
C) depreciation of a machine used in manufacturing. 
D) sales commissions. 
A) the salary of the company president's secretary. 
B) the cost of a general accounting office. 
C) depreciation of a machine used in manufacturing. 
D) sales commissions.

The best estimate of the total contribution margin when 6,300 units are sold is:

The best estimate of the total variable manufacturing cost per unit is:

The following costs were incurred in September: Conversion costs during the month totaled:

Bakker Corporation has provided the following production and average cost data for two levels of monthly production volume. The company produces a single product. The best estimate of the total variable manufacturing cost per unit is:

An example of a committed fixed cost is:

The following costs were incurred in September: Prime costs during the month totaled:

Depreciation is always considered a product cost for external financial reporting purposes in a manufacturing firm.

In making the decision to buy the model 240 machine rather than the model 370 machine, the sunk cost was:

The following data pertains to activity and costs for two months: Assuming that these activity levels are within the relevant range, the mixed cost for July was:

The term differential cost refers to:

Automation results in a shift away from variable costs toward more fixed costs.

What would be the average fixed cost per unit at an activity level of 3,500 units? Assume that this level of activity is within the relevant range.

In order for a cost to be variable it must vary with either units produced or units sold.

What would be the total variable inspection cost at an activity level of 8,100 machine-hours in a month? Assume that this level of activity is within the relevant range.

When a decision is made among a number of alternatives, the benefit that is lost by choosing one alternative over another is the:

Given the cost formula, Y = $9,000 + $2.50X, total cost for an activity level of 3,000 units would be:

The gross margin for July is:

What is the total amount of the costs listed above that are direct costs of the Cosmetics Department?

Each of the following would be a period cost except:

Cost-Volume-Profit Relationships

Job-Order Costing

Variable Costing and Segment Reporting: Tools for Management

Activity-Based-Costing: a Tool to Aid Decision Making

Differential Analysis: The Key to Decision Making

Capital Budgeting Decisions

Capital Budgeting Decisions

Profit Planning

Flexible Budgets and Performance Analysis

Standard Costs and Variances

Performance Measurement in Decentralized Organizations

Managerial Accounting and Cost Concepts

Job-Order Costing

Activity-Based-Costing: a Tool to Aid Decision Making

A Capital Budgeting Decisions

Standard Costs and Variances

Performance Measurement in Decentralized Organizations

Performance Measurement in Decentralized Organizations

Profitability Analysis

Pricing Products and Services

Filters

Exam 1: Managerial Accounting and Cost Concepts

The best estimate of the total contribution margin when 6,300 units are sold is:

The best estimate of the total variable manufacturing cost per unit is:

The following costs were incurred in September: Conversion costs during the month totaled:

Bakker Corporation has provided the following production and average cost data for two levels of monthly production volume. The company produces a single product. The best estimate of the total variable manufacturing cost per unit is:

An example of a committed fixed cost is:

The following costs were incurred in September: Prime costs during the month totaled:

Depreciation is always considered a product cost for external financial reporting purposes in a manufacturing firm.

In making the decision to buy the model 240 machine rather than the model 370 machine, the sunk cost was:

The following data pertains to activity and costs for two months: Assuming that these activity levels are within the relevant range, the mixed cost for July was:

The term differential cost refers to:

Automation results in a shift away from variable costs toward more fixed costs.

What would be the average fixed cost per unit at an activity level of 3,500 units? Assume that this level of activity is within the relevant range.

In order for a cost to be variable it must vary with either units produced or units sold.

What would be the total variable inspection cost at an activity level of 8,100 machine-hours in a month? Assume that this level of activity is within the relevant range.

When a decision is made among a number of alternatives, the benefit that is lost by choosing one alternative over another is the:

Given the cost formula, Y = $9,000 + $2.50X, total cost for an activity level of 3,000 units would be:

The gross margin for July is:

What is the total amount of the costs listed above that are direct costs of the Cosmetics Department?

Each of the following would be a period cost except:

Cost-Volume-Profit Relationships

Job-Order Costing

Variable Costing and Segment Reporting: Tools for Management

Activity-Based-Costing: a Tool to Aid Decision Making

Differential Analysis: The Key to Decision Making

Capital Budgeting Decisions

Capital Budgeting Decisions

Profit Planning

Flexible Budgets and Performance Analysis

Standard Costs and Variances

Performance Measurement in Decentralized Organizations

Managerial Accounting and Cost Concepts

Job-Order Costing

Activity-Based-Costing: a Tool to Aid Decision Making

A Capital Budgeting Decisions

Standard Costs and Variances

Performance Measurement in Decentralized Organizations

Performance Measurement in Decentralized Organizations

Profitability Analysis

Pricing Products and Services

Filters