Question 1

If a company operates at the break even point for each of its segments,it will lose money overall if common fixed expenses exist.

Accepted Answer

A) True 
 B)False

Question 2

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. A properly constructed segmented income statement in a contribution format would show that the segment margin of the North business segment is:

Accepted Answer

A) $213,000 
B) $102,000 
C) $83,000 
D) $18,000 
A) $213,000 
B) $102,000 
C) $83,000 
D) $18,000

Question 3

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. Which costing method (variable or absorption)will generate a higher net operating income in Cutterski's first year of operations and by how much?

Accepted Answer

A) variable by $81,000 
B) variable by $108,000 
C) absorption by $81,000 
D) absorption by $108,000 
A) variable by $81,000 
B) variable by $108,000 
C) absorption by $81,000 
D) absorption by $108,000

Question 4

Sosinski Corporation has two divisions: Domestic Division and Foreign Division.The following data are for the most recent operating period:   The common fixed expenses have been allocated to the divisions on the basis of sales. The Domestic Division's break-even sales is closest to:

Accepted Answer

A) $252,632 
B) $466,116 
C) $178,947 
D) $316,737 
A) $252,632 
B) $466,116 
C) $178,947 
D) $316,737

Question 5

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:

Accepted Answer

A) $212,340 
B) $246,596 
C) $370,000 
D) $159,574 
A) $212,340 
B) $246,596 
C) $370,000 
D) $159,574

Question 6

A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations:   The total contribution margin for the month under variable costing is:

Accepted Answer

A) $160,000 
B) $88,000 
C) $42,600 
D) $120,000 
A) $160,000 
B) $88,000 
C) $42,600 
D) $120,000

Question 7

Jarvix 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?

Accepted Answer

A) $2,100 
B) $25,900 
C) $18,500 
D) $17,800 
A) $2,100 
B) $25,900 
C) $18,500 
D) $17,800

Question 8

Gunderman Corporation has two divisions: the Alpha Division and the Charlie Division.The Alpha Division has sales of $230,000,variable expenses of $131,100,and traceable fixed expenses of $63,300.The Charlie Division has sales of $540,000,variable expenses of $307,800,and traceable fixed expenses of $120,700.The total amount of common fixed expenses not traceable to the individual divisions is $119,200.What is the company's net operating income?

Accepted Answer

A) $147,100 
B) $331,100 
C) $27,900 
D) $211,900 
A) $147,100 
B) $331,100 
C) $27,900 
D) $211,900

Question 9

Gabbert 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:

Accepted Answer

A) $95,200 
B) $156,400 
C) $6,800 
D) $107,600 
A) $95,200 
B) $156,400 
C) $6,800 
D) $107,600

Question 10

Under absorption costing,it is possible to defer a portion of the fixed manufacturing overhead costs of the current period to future periods through the inventory account.

Accepted Answer

A) True 
 B)False

Question 11

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 the absorption costing?

Accepted Answer

A) $42,000 
B) $7,200 
C) $49,200 
D) $28,500 
A) $42,000 
B) $7,200 
C) $49,200 
D) $28,500

Question 12

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?

Accepted Answer

A) $42,000 
B) $49,200 
C) $35,700 
D) $7,200 
A) $42,000 
B) $49,200 
C) $35,700 
D) $7,200

Question 13

The term gross margin is used in reports prepared using:

Accepted Answer

A) both absorption costing and variable costing. 
B) absorption costing but not variable costing. 
C) variable costing but not absorption costing. 
D) neither variable costing nor absorption costing. 
A) both absorption costing and variable costing. 
B) absorption costing but not variable costing. 
C) variable costing but not absorption costing. 
D) neither variable costing nor absorption costing.

Question 14

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 Consumer Division's break-even sales is closest to:

Accepted Answer

A) $273,000 
B) $405,442 
C) $167,442 
D) $584,762 
A) $273,000 
B) $405,442 
C) $167,442 
D) $584,762

Question 15

When using data from a segmented income statement,the dollar sales for a segment to break even is equal to:

Accepted Answer

A) Common fixed expenses ÷ Unit CM 
B) Common fixed expenses ÷ Segment CM ratio 
C) Traceable fixed expenses ÷ Unit CM 
D) Traceable fixed expenses ÷ Segment CM ratio 
A) Common fixed expenses ÷ Unit CM 
B) Common fixed expenses ÷ Segment CM ratio 
C) Traceable fixed expenses ÷ Unit CM 
D) Traceable fixed expenses ÷ Segment CM ratio

Question 16

Rede Inc.manufactures a single product.Variable costing net operating income was $63,800 last year and its inventory decreased by 300 units.Fixed manufacturing overhead cost was $4 per unit for both units in beginning and in ending inventory.What was the absorption costing net operating income last year?

Accepted Answer

A) $65,000 
B) $1,200 
C) $63,800 
D) $62,600 
A) $65,000 
B) $1,200 
C) $63,800 
D) $62,600

Question 17

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

Accepted Answer

A) $19 per unit 
B) $13 per unit 
C) $10 per unit 
D) $14 per unit 
A) $19 per unit 
B) $13 per unit 
C) $10 per unit 
D) $14 per unit

Question 18

Jarvix 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 unit product cost for the month under absorption costing?

Accepted Answer

A) $90 per unit 
B) $74 per unit 
C) $81 per unit 
D) $83 per unit 
A) $90 per unit 
B) $74 per unit 
C) $81 per unit 
D) $83 per unit

Question 19

Hatfield 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?

Accepted Answer

A) $140,300 
B) $140,800 
C) $232,300 
D) $281,100 
A) $140,300 
B) $140,800 
C) $232,300 
D) $281,100

Question 20

Under absorption costing,fixed manufacturing overhead costs:

Accepted Answer

A) are deferred in inventory when production exceeds sales. 
B) are always treated as period costs. 
C) are released from inventory when production exceeds sales. 
D) are ignored. 
A) are deferred in inventory when production exceeds sales. 
B) are always treated as period costs. 
C) are released from inventory when production exceeds sales. 
D) are ignored.

If a company operates at the break even point for each of its segments,it will lose money overall if common fixed expenses exist.

Sosinski Corporation has two divisions: Domestic Division and Foreign Division.The following data are for the most recent operating period: The common fixed expenses have been allocated to the divisions on the basis of sales. The Domestic 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:

A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations: The total contribution margin for the month under variable costing is:

Gabbert 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:

Under absorption costing,it is possible to defer a portion of the fixed manufacturing overhead costs of the current period to future periods through the inventory account.

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 the absorption costing?

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?

The term gross margin is used in reports prepared using:

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 Consumer Division's break-even sales is closest to:

When using data from a segmented income statement,the dollar sales for a segment to break even is equal to:

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

Hatfield 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?

Under absorption costing,fixed manufacturing overhead costs:

Managerial Accounting and Cost Concepts

Job-Order Costing: Calculating Unit Production Costs

Job-Order Costing: Cost Flows and External Reporting

Process Costing

Supplement: Process Costing Using the Fifo Method

Cost-Volume-Profit Relationships

Activity-Based Costing: a Tool to Aid Decision Making

Master Budgeting

Flexible Budgets and Performance Analysis

Differential Analysis: The Key to Decision Making

Performance Measurement in Decentralized Organizations

Differential Analysis: The Key to Decision Making

Capital Budgeting Decisions

Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

Journal Entries to Record Variance

The Concept of Present Value

The Direct Method of Determining the Net Cash Provided by Operating Activities

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Exam 7: Variable Costing and Segment Reporting: Tools for Management

If a company operates at the break even point for each of its segments,it will lose money overall if common fixed expenses exist.

Sosinski Corporation has two divisions: Domestic Division and Foreign Division.The following data are for the most recent operating period: The common fixed expenses have been allocated to the divisions on the basis of sales. The Domestic 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:

A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations: The total contribution margin for the month under variable costing is:

Gabbert 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:

Under absorption costing,it is possible to defer a portion of the fixed manufacturing overhead costs of the current period to future periods through the inventory account.

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 the absorption costing?

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?

The term gross margin is used in reports prepared using:

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 Consumer Division's break-even sales is closest to:

When using data from a segmented income statement,the dollar sales for a segment to break even is equal to:

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

Hatfield 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?

Under absorption costing,fixed manufacturing overhead costs:

Managerial Accounting and Cost Concepts

Job-Order Costing: Calculating Unit Production Costs

Job-Order Costing: Cost Flows and External Reporting

Process Costing

Supplement: Process Costing Using the Fifo Method

Cost-Volume-Profit Relationships

Activity-Based Costing: a Tool to Aid Decision Making

Master Budgeting

Flexible Budgets and Performance Analysis

Differential Analysis: The Key to Decision Making

Performance Measurement in Decentralized Organizations

Differential Analysis: The Key to Decision Making

Capital Budgeting Decisions

Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

Journal Entries to Record Variance

The Concept of Present Value

The Direct Method of Determining the Net Cash Provided by Operating Activities

Filters