Question 1

Within the relevant range:

Accepted Answer

A) variable cost per unit decreases as production decreases. 
B) fixed cost per unit increases as production decreases. 
C) fixed cost per unit decreases as production decreases. 
D) variable cost per unit increases as production decreases. 
A) variable cost per unit decreases as production decreases. 
B) fixed cost per unit increases as production decreases. 
C) fixed cost per unit decreases as production decreases. 
D) variable cost per unit increases as production decreases.

Question 2

Hadrana Corporation reports that at an activity level of 5, 500 units, its total variable cost is $275, 330 and its total fixed cost is $86, 240. What would be the total variable cost at an activity level of 5, 600 units? Assume that this level of activity is within the relevant range.

Accepted Answer

A) $275, 330 
B) $361, 570 
C) $87, 808 
D) $280, 336 
A) $275, 330 
B) $361, 570 
C) $87, 808 
D) $280, 336

Question 3

The salary paid to the maintenance supervisor in a manufacturing plant is an example of:

Accepted Answer

A) Option A 
B) Option B 
C) Option C 
D) Option D 
A) Option A 
B) Option B 
C) Option C 
D) Option D

Question 4

At a sales volume of 37, 000 units, Maks Corporation's property taxes (a cost that is fixed with respect to sales volume)total $802, 900. To the nearest whole dollar, what should be the total property taxes at a sales volume of 39, 700 units? (Assume that this sales volume is within the relevant range. )

Accepted Answer

A) $802, 900 
B) $748, 295 
C) $832, 195 
D) $861, 490 
A) $802, 900 
B) $748, 295 
C) $832, 195 
D) $861, 490

Question 5

All of the following costs would be found in a company's accounting records except:

Accepted Answer

A) sunk cost. 
B) opportunity cost. 
C) indirect costs. 
D) direct costs. 
A) sunk cost. 
B) opportunity cost. 
C) indirect costs. 
D) direct costs.

Question 6

Inspection costs at one of Iuliano Corporation's factories are listed below:   Management believes that inspection cost is a mixed cost that depends on units produced. Using the high-low method, the estimate of the variable component of inspection cost per unit produced is closest to:

Accepted Answer

A) $10.57 
B) $0.11 
C) $17.89 
D) $9.33 
A) $10.57 
B) $0.11 
C) $17.89 
D) $9.33

Question 7

Kodama Corporation staffs a helpline to answer questions from customers.The costs of operating the helpline are variable with respect to the number of calls in a month.At a volume of 30, 000 calls in a month, the costs of operating the helpline total $369, 000. To the nearest whole cent, what should be the average cost of operating the helpline per call at a volume of 31, 300 calls in a month? (Assume that this call volume is within the relevant range. )

Accepted Answer

A) $12.30 
B) $11.79 
C) $10.92 
D) $12.05 
A) $12.30 
B) $11.79 
C) $10.92 
D) $12.05

Question 8

Cost behavior is considered linear whenever a straight line is a reasonable approximation for the relation between cost and activity.

Accepted Answer

A) True 
 B)False

Question 9

Contribution margin means:

Accepted Answer

A) what remains from total sales after deducting fixed expenses. 
B) what remains from total sales after deducting cost of goods sold. 
C) the sum of cost of goods sold and variable expenses. 
D) what remains from total sales after deducting all variable expenses. 
A) what remains from total sales after deducting fixed expenses. 
B) what remains from total sales after deducting cost of goods sold. 
C) the sum of cost of goods sold and variable expenses. 
D) what remains from total sales after deducting all variable expenses.

Question 10

The costs of the Accounting Department at Central Hospital would be considered by the Surgery Department to be:

Accepted Answer

A) direct costs. 
B) indirect costs. 
C) incremental costs. 
D) opportunity costs. 
A) direct costs. 
B) indirect costs. 
C) incremental costs. 
D) opportunity costs.

Question 11

At a volume of 8, 000 units, Pwerson Company incurred $32, 000 in factory overhead costs, including $12, 000 in fixed costs.If volume increases to 9, 000 units and both 8, 000 units and 9, 000 units are within the relevant range, then the company would expect to incur total factory overhead costs of:

Accepted Answer

A) $22, 500 
B) $32, 000 
C) $34, 500 
D) $20, 000 
A) $22, 500 
B) $32, 000 
C) $34, 500 
D) $20, 000

Question 12

At a sales volume of 30, 000 units, Carne Company's total fixed costs are $30, 000 and total variable costs are $45, 000.The relevant range is 20, 000 to 40, 000 units. If Carne Company were to sell 32, 000 units, the total expected cost would be:

Accepted Answer

A) $75, 000 
B) $78, 000 
C) $80, 000 
D) $77, 000 
A) $75, 000 
B) $78, 000 
C) $80, 000 
D) $77, 000

Question 13

At a sales volume of 37, 000 units, Maks Corporation's property taxes (a cost that is fixed with respect to sales volume)total $802, 900. To the nearest whole cent, what should be the average property tax per unit at a sales volume of 40, 300 units? (Assume that this sales volume is within the relevant range. )

Accepted Answer

A) $21.70 
B) $20.22 
C) $19.92 
D) $20.81 
A) $21.70 
B) $20.22 
C) $19.92 
D) $20.81

Question 14

Werner Brothers, Inc. , used the high-low method to derive its cost formula for electrical power cost.According to the cost formula, the variable cost per unit of activity is $2 per machine-hour.Total electrical power cost at the high level of activity was $9, 400 and at the low level of activity was $9, 000.If the high level of activity was 2, 200 machine hours, then the low level of activity was:

Accepted Answer

A) 1, 800 machine hours 
B) 1, 900 machine hours 
C) 2, 000 machine hours 
D) 1, 700 machine hours 
A) 1, 800 machine hours 
B) 1, 900 machine hours 
C) 2, 000 machine hours 
D) 1, 700 machine hours

Question 15

During the month of April, direct labor cost totaled $15, 000 and direct labor cost was 30% of prime cost.If total manufacturing costs during April were $79, 000, the manufacturing overhead was:

Accepted Answer

A) $35, 000 
B) $29, 000 
C) $50, 000 
D) $129, 000 
A) $35, 000 
B) $29, 000 
C) $50, 000 
D) $129, 000

Question 16

Iaci Corporation is a wholesaler that sells a single product.Management has provided the following cost data for two levels of monthly sales volume.The company sells the product for $133.60 per unit.   The best estimate of the total contribution margin when 4, 300 units are sold is:

Accepted Answer

A) $112, 230 
B) $162, 110 
C) $28, 380 
D) $45, 150 
A) $112, 230 
B) $162, 110 
C) $28, 380 
D) $45, 150

Question 17

The traditional format income statement provides managers with an income statement that clearly distinguishes between fixed and variable costs and therefore aids planning, control, and decision making.

Accepted Answer

A) True 
 B)False

Question 18

Haab Inc.is a merchandising company.Last month the company's cost of goods sold was $66, 000.The company's beginning merchandise inventory was $17, 000 and its ending merchandise inventory was $11, 000.What was the total amount of the company's merchandise purchases for the month?

Accepted Answer

A) $72, 000 
B) $66, 000 
C) $94, 000 
D) $60, 000 
A) $72, 000 
B) $66, 000 
C) $94, 000 
D) $60, 000

Question 19

Bee Company is a honey wholesaler.An income statement and other data for the second quarter of the year are given below:     Bee Company's contribution margin for the second quarter is:

Accepted Answer

A) $463, 200 
B) $540, 000 
C) $851, 200 
D) $431, 200 
A) $463, 200 
B) $540, 000 
C) $851, 200 
D) $431, 200

Question 20

Gabat Inc.is a merchandising company.Last month the company's merchandise purchases totaled $67, 000.The company's beginning merchandise inventory was $19, 000 and its ending merchandise inventory was $22, 000.What was the company's cost of goods sold for the month?

Accepted Answer

A) $108, 000 
B) $67, 000 
C) $64, 000 
D) $70, 000 
A) $108, 000 
B) $67, 000 
C) $64, 000 
D) $70, 000

Within the relevant range:

Hadrana Corporation reports that at an activity level of 5, 500 units, its total variable cost is $275, 330 and its total fixed cost is $86, 240. What would be the total variable cost at an activity level of 5, 600 units? Assume that this level of activity is within the relevant range.

The salary paid to the maintenance supervisor in a manufacturing plant is an example of:

All of the following costs would be found in a company's accounting records except:

Inspection costs at one of Iuliano Corporation's factories are listed below: Management believes that inspection cost is a mixed cost that depends on units produced. Using the high-low method, the estimate of the variable component of inspection cost per unit produced is closest to:

Cost behavior is considered linear whenever a straight line is a reasonable approximation for the relation between cost and activity.

Contribution margin means:

The costs of the Accounting Department at Central Hospital would be considered by the Surgery Department to be:

At a sales volume of 30, 000 units, Carne Company's total fixed costs are $30, 000 and total variable costs are $45, 000.The relevant range is 20, 000 to 40, 000 units. If Carne Company were to sell 32, 000 units, the total expected cost would be:

During the month of April, direct labor cost totaled $15, 000 and direct labor cost was 30% of prime cost.If total manufacturing costs during April were $79, 000, the manufacturing overhead was:

Iaci Corporation is a wholesaler that sells a single product.Management has provided the following cost data for two levels of monthly sales volume.The company sells the product for $133.60 per unit. The best estimate of the total contribution margin when 4, 300 units are sold is:

The traditional format income statement provides managers with an income statement that clearly distinguishes between fixed and variable costs and therefore aids planning, control, and decision making.

Haab Inc.is a merchandising company.Last month the company's cost of goods sold was $66, 000.The company's beginning merchandise inventory was $17, 000 and its ending merchandise inventory was $11, 000.What was the total amount of the company's merchandise purchases for the month?

Bee Company is a honey wholesaler.An income statement and other data for the second quarter of the year are given below: Bee Company's contribution margin for the second quarter is:

Gabat Inc.is a merchandising company.Last month the company's merchandise purchases totaled $67, 000.The company's beginning merchandise inventory was $19, 000 and its ending merchandise inventory was $22, 000.What was the company's cost of goods sold for the month?

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

Profit Planning

Flexible Budgets and Performance Analysis

Standard Costs and Variances

Performance Measurement in Decentralized Organizations

Pricing Products and Services

Profitability Analysis

Least Squares Regression Computations

Activity-Based Absorption Costing

the Predetermined Overhead Rate and Capacity

Super-Variable Costing

Abc Action Analysis

the Concept of Present Value

Income Taxes and the Net Present Value Method

Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

Transfer Pricing

Service Department Charges

Filters

Exam 1: Managerial Accounting and Cost Concepts

Within the relevant range:

Hadrana Corporation reports that at an activity level of 5, 500 units, its total variable cost is $275, 330 and its total fixed cost is $86, 240. What would be the total variable cost at an activity level of 5, 600 units? Assume that this level of activity is within the relevant range.

The salary paid to the maintenance supervisor in a manufacturing plant is an example of:

All of the following costs would be found in a company's accounting records except:

Inspection costs at one of Iuliano Corporation's factories are listed below: Management believes that inspection cost is a mixed cost that depends on units produced. Using the high-low method, the estimate of the variable component of inspection cost per unit produced is closest to:

Cost behavior is considered linear whenever a straight line is a reasonable approximation for the relation between cost and activity.

Contribution margin means:

The costs of the Accounting Department at Central Hospital would be considered by the Surgery Department to be:

At a sales volume of 30, 000 units, Carne Company's total fixed costs are $30, 000 and total variable costs are $45, 000.The relevant range is 20, 000 to 40, 000 units. If Carne Company were to sell 32, 000 units, the total expected cost would be:

During the month of April, direct labor cost totaled $15, 000 and direct labor cost was 30% of prime cost.If total manufacturing costs during April were $79, 000, the manufacturing overhead was:

Iaci Corporation is a wholesaler that sells a single product.Management has provided the following cost data for two levels of monthly sales volume.The company sells the product for $133.60 per unit. The best estimate of the total contribution margin when 4, 300 units are sold is:

The traditional format income statement provides managers with an income statement that clearly distinguishes between fixed and variable costs and therefore aids planning, control, and decision making.

Haab Inc.is a merchandising company.Last month the company's cost of goods sold was $66, 000.The company's beginning merchandise inventory was $17, 000 and its ending merchandise inventory was $11, 000.What was the total amount of the company's merchandise purchases for the month?

Bee Company is a honey wholesaler.An income statement and other data for the second quarter of the year are given below: Bee Company's contribution margin for the second quarter is:

Gabat Inc.is a merchandising company.Last month the company's merchandise purchases totaled $67, 000.The company's beginning merchandise inventory was $19, 000 and its ending merchandise inventory was $22, 000.What was the company's cost of goods sold for the month?

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

Profit Planning

Flexible Budgets and Performance Analysis

Standard Costs and Variances

Performance Measurement in Decentralized Organizations

Pricing Products and Services

Profitability Analysis

Least Squares Regression Computations

Activity-Based Absorption Costing

the Predetermined Overhead Rate and Capacity

Super-Variable Costing

Abc Action Analysis

the Concept of Present Value

Income Taxes and the Net Present Value Method

Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

Transfer Pricing

Service Department Charges

Filters