Exam 4: Variable Costing and Segment Reporting: Tools for Management

Delvin 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?

Harris Corporation produces a single product.Last year, Harris manufactured 17, 000 units and sold 13, 000 units.Production costs for the year were as follows: Sales were $780, 000 for the year, variable selling and administrative expenses were $88, 400, and fixed selling and administrative expenses were $170, 000.There was no beginning inventory.Assume that direct labor is a variable cost. Under variable costing, the company's net operating income for the year would be:

Yankee Corporation manufactures a single product.The company has the following cost structure: Last year, 4, 000 units were produced and 3, 500 units were sold.There were no beginning inventories. The carrying value on the balance sheet of the ending finished goods inventory under variable costing would be:

When production exceeds sales and the company uses the LIFO inventory flow assumption, the net operating income reported under absorption costing generally will be:

Walkenhorst Corporation has two divisions: Bulb Division and Seed Division.The following report is for the most recent operating period: The common fixed expenses have been allocated to the divisions on the basis of sales. Required: a.What is the Bulb Division's break-even in sales dollars? b.What is the Seed Division's break-even in sales dollars? c.What is the company's overall break-even in sales dollars?

Data for March for Lazarus Corporation and its two major business segments, North and South, appear below: In addition, common fixed expenses totaled $156, 000 and were allocated as follows: $84, 000 to the North business segment and $72, 000 to the South business segment. The contribution margin of the South business segment is:

The unit product cost under variable costing is:

Sorto Corporation has two divisions: the East Division and the West Division.The corporation's net operating income is $93, 200.The East Division's divisional segment margin is $223, 200 and the West Division's divisional segment margin is $15, 900.What is the amount of the common fixed expense not traceable to the individual divisions?

Crossbow Corp.produces a single product.Data concerning June's operations follow: For the year in question, net operating income under variable costing will be:

Aaker Corporation, which has only one product, has provided the following data concerning its most recent month of operations: What is the net operating income for the month under variable costing?

Phong 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 $102, 340. The Business Division's break-even sales is closest to:

Insider Corporation has two divisions, J and K.During March, the contribution margin in Division J was $30, 000.The contribution margin ratio in Division K was 40%, its sales were $125, 000, and its segment margin was $32, 000.The common fixed expenses in the company were $40, 000, and the company's net operating income was $18, 000.The segment margin for Division J was:

Crow Corporation produces a single product and has the following cost structure: The variable costing unit product cost is:

Ronan Corporation produces a single product and has the following cost structure: Required: Compute the unit product cost under variable costing.Show your work!

Managers will often allocate common fixed expenses to business segments because:

The following data were provided by Rider, Inc, which produces a single product: Under variable costing, the unit product cost is:

Criblez Corporation has two divisions: Blue Division and Gold Division.The following report is for the most recent operating period: The Blue Division's break-even sales is closest to:

Muhn Corporation has two divisions: Division K and Division L.Data from the most recent month appear below: Management has allocated common fixed expenses to the Divisions based on their sales.The break-even in sales dollars for Division K is closest to:

Rollison Corporation has two divisions: Retail Division and Wholesale Division.The following data are for the most recent operating period: The common fixed expenses of the company are $76, 300. The Retail Division's break-even sales in dollars is closest to:

When viewed over the long term, cumulative net operating income will be the same for variable and absorption costing if ending inventories exceed beginning inventories.