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Study Resources (Accounting)

31) Krass Snowboard Mfg. Inc. manufactures snowboards. Its cost of making 3,500 bindings is as follows: Direct materials$32,000 Direct labour.6,200 Variable manufacturing overhead .4,500 Fixed manufacturing overhead 13,300 Total manufacturing costs$56,000 Suppose O’Brien will sell bindings to Krass for $15 each. Krass will pay $1.50 per unit to transport the bindings to its manufacturing plant, where it.
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39) Roadrunner Manufacturing produces Item Q with variable manufacturing costs of $16/unit.  The selling price of Item Q is $20/unit.  The fixed manufacturing overhead cost is $75,000.  A normal production run includes 150,000 units.  Roadrunner Manufacturing has discovered an additional process to change Item Q into Item QR.  Additional costs.
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40) Holsom Cakes is an independent gourmet bakery specializing in special occasion cakes. Being a small operation Holsom is a price taker. The current market price for cakes similar to Holsom’s is $40.  Holsom incurs monthly fixed costs for rent, equipment depreciation and salaries of $7,500. While there are small.
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38) Roadrunner Manufacturing produces Item Q with variable manufacturing costs of $16/unit.  The selling price of Item Q is $20/unit.  The fixed manufacturing overhead cost is $75,000.  A normal production run includes 150,000 units.  Roadrunner Manufacturing has discovered an additional process to change Item Q into Item QR.  Additional costs.
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25) Dulko Corporation manufactures two styles of clocks, a Mantle Clock and a Cuckoo Clock.  The following per unit data are available: Mantle ClockCuckoo Clock Sale price$90$108 Variable costs$60$75 Machine hours required for 1 clock12 Total fixed costs are $600,000 and Dulko can sell a maximum of 25,000 units of each style of lamp annually. .
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27) Bandin Dental Products, located in Moosonee, produces two lines of electric toothbrushes: Deluxe and Standard. Because Bandin can sell all the toothbrushes it can produce, the owners are expanding the plant. They are deciding which product line to emphasize. To make this decision, they assemble the following data: After expansion,.
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26) Markov Fireworks produces two products, spinners and sparklers.  Spinners sell for $4.50 per unit; sparklers sell for $6.50 per unit.  Variable costs for spinners and sparklers are respectively, $3.50 and $3.00.  There are 3,600 direct labor hours per month available for producing one of the two products.  Fixed manufacturing.
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40) Roadrunner Manufacturing produces Item Q with variable manufacturing costs of $16/unit.  The selling price of Item Q is $20/unit.  The fixed manufacturing overhead cost is $75,000.  A normal production run includes 150,000 units.  Roadrunner Manufacturing has discovered an additional process to change Item Q into Item QR.  Additional costs.
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41) Rackets Ltd. Manufactures two models of badminton racquets.  The company’s product line income statement follows: Professional Sportsman Total Sales revenue $125,000 $37,000 $162,000 Cost of goods sold      Variable $25,000 $16,000 41,000      Fixed $27,000 $10,000 37,000 Total cost of goods sold $52,000 $26,000 78,000 Gross profit $73,000 $11,000 84,000 Marketing and administrative expenses     .
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49) Quick Lift manufactures motorcycle power lift ramps for loading motorcycles into the bed of a pickup truck in Erin. Quick Lift’s contribution margin income statement for the most recent month contains the following data: Sales in units      150      Sales revenue  $464,000 Variable expenses: Manufacturing.. $270,000 Marketing and administrative and shipping    67,500 Total variable expenses 337,500 Contribution margin.  126,500 Fixed.
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3) TK Electronics is a manufacturer with two departments: Computer Chips and Cell Phones.  The computer chip that is produced in the Chips Department can be sold to customers at $5.50 per chip. The costs associated with the computer chips are as follows: Variable manufacturing costs$1.80 Variable selling and administrative costs.$0.60 Capacity.375,000 units Current.
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40) Suppose Cool Rays is considering dropping its Tinted Glass product line. Assume that during the past year, the Tinted Lens product line income statement showed the following: Sales$2,750,000 Cost of goods sold2,275,000 Gross profit475,000 Operating expenses560,000 Operating loss$(85,000) Fixed manufacturing overhead costs account for 40% of the cost of goods, while only 30% of the.
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36) Electronic Media manufactures DVDs and Blu-ray products.  The company’s product line income statement follows: Blu-ray DVDs Total Sales revenue $350,000 $112,000 $462,000 Cost of goods sold      Variable $75,000 $49,000 $124,000      Fixed $82,000 $28,000 $110,000 Total cost of goods sold $157,000 $77,000 $234,000 Gross profit .
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34) The Shoop Corporation produces and sells a part used in the production of tractors. The unit costs associated with this part are as follows: Direct materials$.16 Direct labor.32 Variable manufacturing overhead.25 Fixed manufacturing overhead   .10 Total cost$.83 Jupiter Company has approached Shoop Corporation with an offer to purchase 20,000 units of this part at a.
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42) Rackets Ltd. Manufactures two models of badminton racquets.  The company’s product line income statement follows: Professional Sportsman Total Sales revenue $225,000 $75,000 $300,000 Cost of goods sold      Variable $45,000 $30,000 75,000      Fixed $50,000 $20,000 70,000 Total cost of goods sold $95,000 $50,000 145,000 Gross profit $130,000 $25,000 155,000 Marketing and administrative expenses     .
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1) When setting prices, a company must consider whether it is a price-taker or a price-setter for each product that it sells. 2) A price-setter company emphasizes a target costing approach to pricing. 3) For a product, revenue at market price plus desired operating profit equals target total cost. 4) When a company.
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31) Contribution margin income statement data for the most recent year follow: Total Adult jackets Children’s jackets Sales revenue $365,000 $275,000 $90,000 Variable expenses $205,000 $165,000 $40,000 Contribution margin $160,000 $110,000 $50,000 Fixed expenses $102,000 $50,000 $52,000 Operating income (loss) $58,000 $60,000 $(2,000) Assuming the.
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11) Managers only need to consider variable costs when setting prices. 12) Cost-plus pricing is essentially the opposite of target-costing. 13) Which of the following best describes "total cost of product or service"? A) Benefits foregone by not choosing an alternative course of action B) A factor that restricts production or sales of a.
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29) Define the term constraints and give an example. What product should be made first when resource constraints exist? 30) Garden Supplies Company produces a standard tomato planter with variable manufacturing costs of $12 per unit.  The selling price of the standard tomato planter is $19 per unit.  The fixed manufacturing.
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39) Suppose Cool Rays is considering dropping its Tinted Glass product line. Assume that during the past year, the Tinted Lens product line income statement showed the following: Sales $1,850,000 Cost of goods sold 1,540,000 Gross profit..310,000 Operating expenses345,000 Operating loss $(35,000) Fixed manufacturing overhead costs account for 40% of the cost of goods, while only.
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37) Exercise Equipment Enterprises currently produces several products.  Exercycle Model LM01 is showing a net operating loss as indicated by the following condensed income statement prepared for the year ended December 31. You have been hired by Exercise Equipment Enterprises to help analyze the decision as to whether to eliminate Exercycle.
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43) Rackets Ltd. Manufactures two models of badminton racquets.  The company’s product line income statement follows: Professional Sportsman Total Sales revenue $75,000 $25,000 $100,000 Cost of goods sold      Variable $15,000 $10,000 25,000      Fixed $20,000 $7,500 27,500 Total cost of goods sold $35,000 $17,500 52,500 Gross profit $40,000 $7,500 47,500 Marketing and administrative expenses     .
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21) Big-box retailers such as Best Buy are considered price-takers because: A) their products are unique. B) there is less competition in the consumer electronics retail sector. C) their products are not unique. D) they emphasize cost-plus pricing. 22) Target total cost is defined as: A) revenue at market price less desired profit. B) cost of goods.
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33) Hidef Electronics manufactures a digital flat screen TV which includes an MP3 player. Its current costs of manufacturing the needed 100,000 MP3 players per month are: Direct materials$900,000 Direct labour…240,000 Variable manufacturing overhead160,000 Fixed manufacturing overhead  300,000 Total manufacturing costs $1,600,000 Another manufacturer offers to sell Hidef the needed 100,000 MP3 players per month for.
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17) On the line in front of each statement, enter the letter corresponding to the term that best fits that statement. An item may be used more than once or not at all. A. Relevant costs E. Opportunity costs B. Sunk costs F. Full cost of product or service C. Constraint G. Sales mix D. Contribution margin H. Variable costing ____Benefits foregone by not choosing an alternative.
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11) Fine Pottery Processors manufactures two products, platters and tureens, from a joint process. Platters are allocated $5,000 of the total joint costs of $25,000.  There are 1,500 platters produced and 1,500 tureens produced each year.  Platters can be sold at the split-off point for $12 per unit, or they.
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51) Quick Lift manufactures motorcycle power lift ramps for loading motorcycles into the bed of a pickup truck in Erin. Quick Lift’s contribution margin income statement for the most recent month contains the following data: Sales in units     150    Sales revenue $464,000 Variable expenses: Manufacturing $270,000 Marketing and administrative and shipping    67,500 Total variable expenses 337,500 Contribution margin 126,500 Fixed expenses: Manufacturing    .
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