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

Criblez Corporation has two divisions: Blue Division and Gold Division.The following report is for the most recent operating period: What is the company's overall net operating income if it operates at the break-even points for its two divisions?

Propst Corporation has two divisions: Garden Division and Farm Division.The following report is for the most recent operating period: Required: a.What is the Garden Division's break-even in sales dollars? b.What is the Farm Division's break-even in sales dollars? c.What is the company's overall break-even in sales dollars? d.What would be the company's overall net operating income if the company operated at its two division's break-even points?

Yuvil Corporation produces a single product.At the end of the company's first year of operations,1,000 units of inventory remained on hand.Its variable manufacturing overhead cost is $45 per unit and its fixed manufacturing overhead cost is $10 per unit.Yuvil's absorption costing net operating income would be higher than its variable costing net operating income by:

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?

Meyer Corporation has two sales areas: North and South.During April,the contribution margin in the North was $90,000,or 30% of sales.The segment margin in the South was $25,000,or 10% of sales.Traceable fixed expenses were $30,000 in the North and $15,000 in the South.Meyer Corporation reported a total net operating income of $52,000. The variable costs for the South area were:

Bode Corporation has two divisions: East and West.Data from the most recent month appear below: The company's common fixed expenses total $47,300.If the company operates at exactly the break-even sales of the East Division and West Division,what would be the company's overall net operating income?

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

Peterson Corporation produces a single product.Data from the company's records for last year follow: Under variable costing the value of the ending finished goods inventory would be:

A common fixed cost is a fixed cost that is incurred because of the existence of a particular business segment and that would be eliminated if the segment were eliminated.

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. The contribution margin per unit was:

During its first year of operations,Carlos Manufacturing Corporation incurred the following costs to produce 8,000 units of its only product: The company also incurred the following costs in selling 7,500 units of product during its first year: Assume that direct labor is a variable cost. Under variable costing,what is the total cost that would be assigned to Carlos' finished goods inventory at the end of the first year of operations?

Last year,Hruska Corporation's variable costing net operating income was $92,200 and ending inventory decreased by 600 units.Fixed manufacturing overhead cost per unit was $3 in both beginning and ending inventory. Required: Determine the absorption costing net operating income for last year.Show your work!

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. Under variable costing,the unit product cost would be:

Farron 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 absorption costing?

A national retail company has segmented its income statement by sales territories.If each sales territory statement is further segmented by individual stores,which of the following will most likely occur?

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:

Common fixed expenses should be allocated to business segments when performing break-even calculations and making decisions.

Pen Corporation manufactures a single product.Last year,the company's variable costing net operating income was $55,700 and ending inventory increased by 800 units.Fixed manufacturing overhead cost per unit was $3 in both beginning and ending inventory. Required: Determine the absorption costing net operating income for last year.Show your work!

Zimmerli Corporation manufactures a single product.The following data pertain to the company's operations over the last two years: Required: a.Determine the absorption costing net operating income last year.Show your work! b.Determine the absorption costing net operating income this year.Show your work!

Under absorption costing,fixed manufacturing overhead cost is not included in product cost.