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

Hatfield Corporation, which has only one product, has provided the following data concerning its most recent month of operations: The total contribution margin for the month under variable costing is:

Cutterski Corporation manufactures a propeller.Shown below is Cutterski's cost structure: In its first year of operations, Cutterski produced 60, 000 propellers but only sold 54, 000. What would Cutterski report as its cost of goods sold under absorption costing?

Clemmens Corporation has two major business segments: Consumer and Commercial.Data for the segments and for the company for August appear below: In addition, common fixed expenses totaled $265, 000 and were allocated as follows: $135, 000 to the Consumer business segment and $130, 000 to the Commercial business segment. A properly constructed segmented income statement in a contribution format would show that the segment margin of the Consumer business segment is:

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 Wholesale Division's break-even sales in dollars is closest to:

Keefe Corporation has two divisions: Western Division and Eastern 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. The Western Division's break-even sales is closest to:

The Dean Corporation produces and sells a single product.The following data refer to the year just completed: Assume that direct labor is a variable cost. Required: a.Compute the cost of a single unit of product under both the absorption costing and variable costing approaches. b.Prepare an income statement for the year using absorption costing. c.Prepare a contribution format income statement for the year using variable costing. d.Reconcile the absorption costing and variable costing net operating income figures in (b)and (c)above.

Khanam Corporation, which has only one product, has provided the following data concerning its most recent month of operations: The company produces the same number of units every month, although the sales in units vary from month to month.The company's variable costs per unit and total fixed costs have been constant from month to month. What is the net operating income for the month under absorption costing?

DC Construction has two divisions: Remodeling and New Home Construction.Each division has an on-site supervisor who is paid a salary of $62, 000 annually and one salaried estimator who is paid $36, 000 annually.The corporate office has two office administrative assistants who are paid salaries of $40, 000 and $32, 000 annually.The president's salary is $138, 000.How much of these salaries are common fixed expenses?

Segment margin is a better measure of the long-run profitability of a segment than contribution margin.

Assuming the LIFO inventory flow assumption, if production equals sales for the period, absorption costing and variable costing will produce the same net operating income.

Gabbert 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 the absorption costing?

Cutterski Corporation manufactures a propeller.Shown below is Cutterski's cost structure: In its first year of operations, Cutterski produced 60, 000 propellers but only sold 54, 000. What is the total cost that would be assigned to Cutterski's finished goods inventory at the end of the first year of operations under variable costing?

A company that produces a single product had a net operating income of $75, 000 using variable costing and a net operating income of $95, 000 using absorption costing.Total fixed manufacturing overhead was $50, 000 and production was 10, 000 units both this year and last year.Last year was the first year of operations.Between the beginning and the end of the year, the inventory level:

Peterson Corporation produces a single product.Data from the company's records for last year follow: Under variable costing, net operating income would be:

Craft Corporation produces a single product.Last year, the company had a net operating income of $80, 000 using absorption costing and $74, 500 using variable costing.The fixed manufacturing overhead cost was $5 per unit.There were no beginning inventories.If 21, 500 units were produced last year, then sales last year were:

Chown Corporation, which has only one product, has provided the following data concerning its most recent month of operations: The total gross margin for the month under the absorption costing approach is:

Iancu Corporation, which has only one product, has provided the following data concerning its most recent month of operations: What is the unit product cost for the month under variable costing?

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

Ivancevic Inc. , which produces a single product, has provided the following data for its most recent month of operation: The company had no beginning or ending inventories. Required: Compute the unit product cost under variable costing.Show your work!

Gabbert Corporation, which has only one product, has provided the following data concerning its most recent month of operations: The total contribution margin for the month under variable costing is: