Question 1

For short-term pricing decisions, absorption costing is an appropriate costing method to use.

Accepted Answer

A) True 
 B)False

Question 2

Identify the treatment of each of the following costs under variable costing and absorption costing:
 $$\begin{array} { | l | l | l | l | l | } 
\hline & \text { Variable Costing } & &\text { Absorption Costing } \
\hline & \text { Product Cost } & \text { Period Cost } & \text { Product Cost } & \text {Period Cost } \
\hline \text { 1. Direct materials } & & & & \
\hline \text { 2. Direct labor } & & & & \
\hline \text { 3. Variable manufacturing overhead } & & & & \
\hline \text { 4. Fixed manufacturing overhead } & & & & \
\hline \text { 5. Variable selling } & & & & \
\hline \text { 6. Fixed selling } & & & & \
\hline \text { 7. Variable administrative } & & & & \
\hline \text { 8. Fixed administrative } & & & & \
\hline
\end{array}$$

Accepted Answer

The answer of Identify the treatment of each of the...

Question 3

Under variable costing, product costs consist of direct labor, direct materials, and ________.

Accepted Answer

variable m

Question 4

Chance, Inc. sold 3,000 units of its product at a price of $72 per unit. Total variable cost per unit is $51, consisting of $32 in variable production cost and $19 in variable selling and administrative cost. Compute the manufacturing margin for the company under variable costing.

Accepted Answer

A)  $96,000 
B)  $63,000 
C)  $120,000 
D)  $216,000 
E)  ($90,000) 
A)  $96,000 
B)  $63,000 
C)  $120,000 
D)  $216,000 
E)  ($90,000)

Question 5

Fanelli Company had net income of $678,000 based on variable costing. Beginning and ending inventories were 5,000 units and 4,200 units, respectively. Assume the fixed overhead cost per unit was $.50 for both the beginning and ending inventory. What is net income under absorption costing?

Accepted Answer

Income under variable costing

Question 6

Under absorption costing, the product unit cost consists of direct labor, direct materials, variable overhead, and ________.

Accepted Answer

The answer of Under absorption costing, the product unit cost...

Question 7

Alexis Co. reported the following information for May:   What is the manufacturing margin for Part A?

Accepted Answer

A)  $1,000,000 
B)  $1,400,000 
C)  $3,600,000 
D)  $2,600,000 
E)  $2,400,000 
A)  $1,000,000 
B)  $1,400,000 
C)  $3,600,000 
D)  $2,600,000 
E)  $2,400,000

Question 8

[The following information applies to the questions displayed below.]
Cool Pools, a manufacturer of above ground pools, began operations on January 1 of the current year. During this time, the company produced 45,000 units and sold 44,000 units at a sales price of $60 per unit. Cost information for this year is shown in the following table:
  
-Given the Cool Pools Company data, what is net income using absorption costing?

Accepted Answer

A)  $1,649,480 
B)  $1,648,600 
C)  $1,627,150 
D)  $1,709,480 
E)  $1,708,600 
A)  $1,649,480 
B)  $1,648,600 
C)  $1,627,150 
D)  $1,709,480 
E)  $1,708,600

Question 9

Chilly Chips, Inc., a producer of ice cream, began operations this year. During this year, the company produced 160,000 cartons of ice cream and sold 145,000. At year-end, the company reported the following income statement using absorption costing:
   Production costs per carton total $3.50, which consists of $2.30 in variable production costs and $1.20 in fixed production costs (based on the 160,000 units produced). Sixty percent of total selling and administrative expenses are variable. Compute net income under variable costing.

Accepted Answer

Income under absorption costing = Income

Question 10

Lukin Corporation reports the following first year production cost information.
 $$\begin{array} { | l | l | } 
\hline \text { Units produced } & 62,000 \text { units } \
\hline \text { Units sold } & 59,000 \text { units } \
\hline \text { Direct labor } & \$ 41 \text { per unit } \
\hline \text { Direct materials } & \$ 15 \text { per unit } \
\hline \text { Variable overhead } & \$ 150 \text { per unit } \
\hline \text { Fixed overhead } & \$ 4,340,000 \text { in total } \
\hline
\end{array}$$ a. Compute production cost per unit under variable costing.
b. Compute production cost per unit under absorption costing.
c. Determine the cost of ending inventory using variable costing.
d. Determine the cost of ending inventory using absorption costing.

Accepted Answer

a. $41 DL + $15 DM + $150 VOH = $206 per

Question 11

Given the following data, total product cost per unit under variable costing is $10.75.

Accepted Answer

A) True 
 B)False

Question 12

Toth, Inc. had net income of $950,000 based on variable costing. Beginning and ending inventories were 60,000 units and 56,000 units, respectively. Assume the fixed overhead cost per unit was $.85 for both the beginning and ending inventory. What is net income under absorption costing?

Accepted Answer

Income under variable costing

Question 13

A per unit cost that is constant at all production levels is a ________ cost per unit.

Accepted Answer

The answer of A per unit cost that is constant...

Question 14

Stonehenge Inc., a manufacturer of landscaping blocks, began operations on April 1 of the current year. During this time, the company produced 750,000 units and sold 720,000 units at a sales price of $9 per unit. Cost information for this period is shown in the following table:
 $$\begin{array} { | l | l | } 
\hline \text { Production costs } & \
\hline \text { Direct materials } & \$ 1.80 \text { per unit } \
\hline \text { Direct labor } & \$ .30 \text { per unit } \
\hline \text { Variable overhead } & \$ 495,000 \text { in total } \
\hline \text { Fixed overhead } & \$ 450,000 \text { in total } \
\hline \text { Non production costs } & \
\hline \text { Variable selling and administrative } & \$ 18,000 \text { in total } \
\hline \text { Fixed selling and administrative } & \$ 53,000 \text { in total } \
\hline
\end{array}$$ a. Prepare Stonehenge's December 31st income statement for the current year under absorption costing.
b. Prepare Stonehenge's December 31st income statement for the current year under variable costing.

Accepted Answer

The answer of Stonehenge Inc., a manufacturer of landscaping blocks,...

Question 15

Given the following data, calculate product cost per unit under variable costing.

Accepted Answer

A)  $7 per unit 
B)  $13.30 per unit 
C)  $11.00 per unit 
D)  $11.60 per unit 
E)  $16.50 per unit 
A)  $7 per unit 
B)  $13.30 per unit 
C)  $11.00 per unit 
D)  $11.60 per unit 
E)  $16.50 per unit

Question 16

________ is the amount remaining from sales revenues after cost of goods sold has been deducted.

Accepted Answer

The answer of ________ is the amount remaining from sales...

Question 17

Information presented in a variable costing format can assist management when making short-term pricing decisions.

Accepted Answer

A) True 
 B)False

Question 18

Given the following data, total product cost per unit under variable costing is $7.09.

Accepted Answer

A) True 
 B)False

Question 19

Jeter Corporation had net income of $212,000 based on variable costing. Beginning and ending inventories were 6,000 units and 10,000 units, respectively. Assume the fixed overhead per unit was $4 for both the beginning and ending inventory. What is net income under absorption costing?

Accepted Answer

A)  $252,000 
B)  $228,000 
C)  $244,000 
D)  $276,000 
E)  $212,000 
A)  $252,000 
B)  $228,000 
C)  $244,000 
D)  $276,000 
E)  $212,000

Question 20

Which of the following best describes costs assigned to the product under the variable costing method? Direct labor (DL)
Direct materials (DM)
Variable selling and administrative (VSA)
Variable manufacturing overhead (VOH)
Fixed selling and administrative (FSA)
Fixed manufacturing overhead (FOH)

Accepted Answer

A)  DL, DM, VSA, and VOH. 
B)  DL, DM, and VOH. 
C)  DL, DM, VOH, and FOH. 
D)  DL and DM. 
E)  DL, DM, FSA, and FOH. 
A)  DL, DM, VSA, and VOH. 
B)  DL, DM, and VOH. 
C)  DL, DM, VOH, and FOH. 
D)  DL and DM. 
E)  DL, DM, FSA, and FOH.

For short-term pricing decisions, absorption costing is an appropriate costing method to use.

Under variable costing, product costs consist of direct labor, direct materials, and ________.

Chance, Inc. sold 3,000 units of its product at a price of $72 per unit. Total variable cost per unit is $51, consisting of $32 in variable production cost and $19 in variable selling and administrative cost. Compute the manufacturing margin for the company under variable costing.

Fanelli Company had net income of $678,000 based on variable costing. Beginning and ending inventories were 5,000 units and 4,200 units, respectively. Assume the fixed overhead cost per unit was $.50 for both the beginning and ending inventory. What is net income under absorption costing?

Under absorption costing, the product unit cost consists of direct labor, direct materials, variable overhead, and ________.

Alexis Co. reported the following information for May: What is the manufacturing margin for Part A?

Given the following data, total product cost per unit under variable costing is $10.75.

Toth, Inc. had net income of $950,000 based on variable costing. Beginning and ending inventories were 60,000 units and 56,000 units, respectively. Assume the fixed overhead cost per unit was $.85 for both the beginning and ending inventory. What is net income under absorption costing?

A per unit cost that is constant at all production levels is a ________ cost per unit.

Given the following data, calculate product cost per unit under variable costing.

________ is the amount remaining from sales revenues after cost of goods sold has been deducted.

Information presented in a variable costing format can assist management when making short-term pricing decisions.

Given the following data, total product cost per unit under variable costing is $7.09.

Jeter Corporation had net income of $212,000 based on variable costing. Beginning and ending inventories were 6,000 units and 10,000 units, respectively. Assume the fixed overhead per unit was $4 for both the beginning and ending inventory. What is net income under absorption costing?

Which of the following best describes costs assigned to the product under the variable costing method? Direct labor (DL) Direct materials (DM) Variable selling and administrative (VSA) Variable manufacturing overhead (VOH) Fixed selling and administrative (FSA) Fixed manufacturing overhead (FOH)

Managerial Accounting Concepts and Principles

Job Order Costing and Analysis

Process Costing and Analysis

Activity-Based Costing and Analysis

Cost Behavior and Cost-Volume-Profit Analysis

Master Budgets and Performance Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Relevant Costing for Managerial Decisions

Capital Budgeting and Investment Analysis

Reporting Cash Flows

Analysis of Financial Statements

Time Value of Money

Lean Principles and Accounting

Accounting for Business Transactions

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Exam 6: Variable Costing and Analysis

For short-term pricing decisions, absorption costing is an appropriate costing method to use.

Under variable costing, product costs consist of direct labor, direct materials, and ________.

Chance, Inc. sold 3,000 units of its product at a price of $72 per unit. Total variable cost per unit is $51, consisting of $32 in variable production cost and $19 in variable selling and administrative cost. Compute the manufacturing margin for the company under variable costing.

Fanelli Company had net income of $678,000 based on variable costing. Beginning and ending inventories were 5,000 units and 4,200 units, respectively. Assume the fixed overhead cost per unit was $.50 for both the beginning and ending inventory. What is net income under absorption costing?

Under absorption costing, the product unit cost consists of direct labor, direct materials, variable overhead, and ________.

Alexis Co. reported the following information for May: What is the manufacturing margin for Part A?

Given the following data, total product cost per unit under variable costing is $10.75.

Toth, Inc. had net income of $950,000 based on variable costing. Beginning and ending inventories were 60,000 units and 56,000 units, respectively. Assume the fixed overhead cost per unit was $.85 for both the beginning and ending inventory. What is net income under absorption costing?

A per unit cost that is constant at all production levels is a ________ cost per unit.

Given the following data, calculate product cost per unit under variable costing.

________ is the amount remaining from sales revenues after cost of goods sold has been deducted.

Information presented in a variable costing format can assist management when making short-term pricing decisions.

Given the following data, total product cost per unit under variable costing is $7.09.

Jeter Corporation had net income of $212,000 based on variable costing. Beginning and ending inventories were 6,000 units and 10,000 units, respectively. Assume the fixed overhead per unit was $4 for both the beginning and ending inventory. What is net income under absorption costing?

Which of the following best describes costs assigned to the product under the variable costing method? Direct labor (DL) Direct materials (DM) Variable selling and administrative (VSA) Variable manufacturing overhead (VOH) Fixed selling and administrative (FSA) Fixed manufacturing overhead (FOH)

Managerial Accounting Concepts and Principles

Job Order Costing and Analysis

Process Costing and Analysis

Activity-Based Costing and Analysis

Cost Behavior and Cost-Volume-Profit Analysis

Master Budgets and Performance Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Relevant Costing for Managerial Decisions

Capital Budgeting and Investment Analysis

Reporting Cash Flows

Analysis of Financial Statements

Time Value of Money

Lean Principles and Accounting

Accounting for Business Transactions

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