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Study Resources (Accounting)

62) The following data pertain to costs at Richardson Company: Total fixed costs $750,000 Total variable costs $110,000 Production level 40,000 units The variable cost per unit is: A) $2.75. B) $18.75. C) $21.50. D) $3.75. 63) The following data pertain to costs at Richardson Company: Total fixed costs $750,000 Total variable costs $110,000 Production level 40,000 units The average cost per unit is: A) $2.75. B).
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57) The controller for Truman Canoes has gathered the following cost and activity level information: Average total cost per unit $300.00 Production level used to calculate average cost 2,000 Total fixed costs $100,000 A.  What is the total cost of producing 2,000 fiberglass canoes? B.  What is the variable cost of producing each.
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11) Managers often approximate curvilinear costs and step costs as mixed costs. 12) If production increases by 15%, how will total variable costs likely react? A) Increase by 7.5% B) Increase by 15% C) Decrease by 15% D) Remain the same 13) Which of the following would be considered a discretionary fixed cost? A) Property taxes and.
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28) Stella Services has a customer website to take orders, answer customer questions, and address customer complaints.  The costs associated with this customer website over the past six months are listed below: Month Customer website costs Number of website hits January $15,000 9,000 February $15,400 9,200 March $16,000 10,200 April $15,950 9,700 May $14,500 8,200 June $14,800 8,800 Management at Stella Services believes that the customer website costs are a mixed cost.
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1) For retailers and service companies, operating income is the same whether a traditional income statement or a contribution margin income statement is prepared. 2) Revenue less cost of goods sold equals contribution margin. 3) When preparing a traditional income statement, fixed costs are subtracted from gross margin to arrive at operating.
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31) Preston Racquets manufactures tennis racquets. The following data are available for last month. Units in beginning inventory 0 Units produced during year 1,200 racquets Units in ending inventory 200 racquets Sales commissions per racquet $10.00 Fixed manufacturing overhead $48,000 Fixed marketing expenses $12,000 Selling price per racquet $200 Variable manufacturing cost per racquet $110 Using variable costing, what is the contribution margin for last month? A).
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60) Travel Throne Inc produces after-market heated seats for motorcycles. The company's average cost per seat is $350.00 when it produces 6,000 seats per month. Required: 1. What is the total cost of producing 6,000 seats? 2. If $750,000 of the total cost is fixed, what is the variable cost of producing each.
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41) Jeppson Company manufactures computer hard drives. The following data is related to sales and production of the computer hard drives for last year. Selling price per unit $100.00 Variable manufacturing costs per unit $45.00 Variable selling and administrative expenses per unit $6.00 Fixed manufacturing overhead (in total) $30,000 Fixed selling and.
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47) Match the term on the right with the appropriate definition provided on the right. Definition Term   1. _____ A statistical procedure for determining the line that best fits the data by using all of the historical data points, not just the high and low data points A. Outliers   2. _____ Costs that change, but.
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30) What are three methods used to estimate cost behavior?  What are the advantages and disadvantages of each method? 31) Sisler Company would like to estimate its total manufacturing costs using regression analysis but unsure whether machine hours or units produced would be a better predictor of total manufacturing costs. Output from regression analysis.
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56) Jetboat Tours Company offers guided jet boat rides on the Magnetewan River. The tour business is highly regulated by the municipal government. Jet Boat Tours Company has the following operating costs during July: Monthly depreciation expense on equipment.$2,135 Fee paid to the Municipal Government for docking etc10% of ticket revenue Cost of.
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33) The controller of Menno Corp presents you with the following observations in a general ledger account called Maintenance: Month Machine-hours Maintenance Costs Incurred January 6,000 $4,000 February 8,000 4,750 March 8,500 4,900 April 9,000 5,000 May 7,000 4,400 June 10,000 5,400 Using the high-low method, what will the total monthly manufacturing costs be if the company produces 7,500 units? A) $2,625 B) $5,555 C) $4,525 D) $4,050 34) Gourmet College has recently opened a restaurant as.
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1) When a manufacturer prepares a contribution margin income statement, Cost of Goods Sold is always a variable cost. 2) When a company produces more units than it sells, absorption costing operating income will be less than variable costing operating income. 3) If the number of units produced equals the number of.
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37) Gourmet College has recently opened a restaurant as part of its hospitality major. The manager gathered the following data from the first five weeks of operations. Knowing you are currently taking a managerial accounting course he has asked that you analyze the data Week Number of customers per week Weekly total restaurant.
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31) Total fixed costs for Excelsior Corporation are $600,000.  Total costs, both fixed and variable, are $750,000 if 125,000 units are produced.  The fixed cost per unit at 300,000 units would be: A) $6.00/unit. B) $0.50/unit. C) $4.80/unit. D) $2.00/unit. 32) Total fixed costs for Yellow Boats Inc. are $100,000.  Total costs, both fixed and.
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32) Maxwell Corporation is trying to predict its manufacturing overhead costs for the upcoming year; they are debating the use of the high-low method versus the use of regression analysis.  They have gathered information about their manufacturing overhead costs in each of the past six months. A table containing their.
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10) A “perfect” straight line would render an R-square value of zero. 11) If the data points were randomly scattered, the R-square value would be closer to 1 than 0. 12) An R-square value over .80 generally indicates that the cost equation is very reliable for predicting costs at other volumes within.
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41) Feathered Nests produces decorative birdhouses. The company's average cost per unit is $20.00 when it produces 2,000 birdhouses. If $4,800 of the costs are fixed, and the plant manager uses the average cost per unit to predict total costs, his forecast for 2,200 birdhouses will be: A) $44,000. B) $43,520. C) $4,000. D).
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51) Ava's Hats is a small e-tail business specializing in the hand crocheted hats for infants and toddlers over the web. The business is owned by a sole proprietor and operated out of her home. Results for last year are as follows: AVA'S HATS Income  Statement December 31 Sales revenue$852,300 Cost of goods sold (498,900) Gross.
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49) Ava's Chapeaus is a small e-tail business specializing in the hand crocheted hats for infants and toddlers over the web. The business is owned by a sole proprietor and operated out of her home. Results for last year are as follows: AVA'S CHAPEAUS Income  Statement December 31 Sales revenue$394,800 Cost of goods sold(266,000) Gross profit128,800 Operating.
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11) If inventory has grown, operating income will be higher under variable costing than it is under absorption costing. 12) If inventory has declined, operating income will be higher under variable costing than it is under absorption costing. 13) If inventory has not increased or decreased, but has stayed the same, operating.
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21) On a contribution margin income statement, all variable costs are listed: A) above the contribution margin line. B) above the gross profit line. C) below the contribution margin line. D) below the gross profit line. 22) Suzy's Cool Treatz is a snow cone stand near the local park. To plan for the future, the.
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11) Contribution margin income statements organize costs by behavior rather than by function. 12) On a traditional income statement, sales revenue less cost of goods sold equals: A) contribution margin. B) gross profit. C) operating income. D) operating expenses. 13) GAAP allows companies to use ________ for external reporting purposes. A) only the traditional format of the.
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51) Harbor Manufacturing is trying to predict the cost associated with producing its anchors.  At a production level of 4,000 anchors, Harbor Manufacturing's average cost per anchor is $50.00.   If $20,000 of the costs are fixed, and the plant manager uses the cost equation to predict total costs, her forecast.
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53) Spadina Carriage Company offers guided mini-bus tours through downtown  Toronto. The tour business is highly regulated by the city. Spadina Carriage Company has the following operating costs during July: Monthly depreciation expense on non-automotive equipment. $3,625 Fee paid to the City of Toronto15% of ticket revenue Cost of souvenir set of postcards.
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41) Gourmet College has recently opened a restaurant as part of its hospitality major. The manager gathered the following data from the first five weeks of operations. Knowing you are currently taking a managerial accounting course he has asked that you analyze the data Week Number of customers per week Weekly total restaurant.
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58) Cute Wheels Cars produces custom wheels. The company's average cost per wheel is $189.50 when it produces 5,000 wheels per month. Required: 1. What is the total cost of producing 5,000 wheels? 2. If $500,000 of the total cost is fixed, what is the variable cost of producing each wheel? 3. What is.
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30) The controller of Menno Corp presents you with the following observations in a general ledger account called Maintenance: Month Machine-hours Maintenance Costs Incurred January 6,000 $4,000 February 8,000 4,750 March 8,500 4,900 April 9,000 5,000 May 7,000 4,400 June 10,000 5,400 Using the high- low method, what would the variable maintenance cost per machine hour be? A) $0.35 B) $0.54 C) $1.50 D) $0.67 31) The controller of Menno Corp presents you with the following observations.
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29) To follow is information about the units produced and total manufacturing costs for Darryl Rug Company for the past six months. Month Number of units produced Total manufacturing costs January 28,800 $21,500 February 31,200 $22,500 March 25,200 $19,500 April 26,400 $20,000 May 30,800 $23,000 June 29,000 $21,900 Darryl Rug Company uses the high-low method to estimate its costs. Answer the following questions: A.  What is the variable.
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52) Ava's Boutique is a small e-tail business specializing in the hand crocheted hats for infants and toddlers over the web. The business is owned by a sole proprietor and operated out of her home. Results for last year are as follows: AVA'S BOUTIQUE Income  Statement December 31 Sales revenue$289,300 Cost of goods sold  (201,100) Gross.
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20) When predicting costs at other volumes using a cost equation derived from either the high-low method or regression analysis, managers should consider: A) outliers. B) general inflation. C) seasonality. D) all of the above. 21) Your client's company wants to determine the relationship between its monthly operating costs and a potential cost driver. The.
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21) Net income reported under absorption costing will exceed net income reported under variable costing for a given period if: A) production equals sales for that period. B) production exceeds sales for that period. C) sales exceed production for that period. D) variable overhead exceeds fixed overhead for that period. 22) Under absorption costing, the.
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36) Selected financial data for Flash Corporation follows for a production level of 100,000 units: Total fixed costs $400,000 Total costs (fixed and variable) $500,000 A.  Calculate the variable cost per unit. B.  If Flash Corporation makes 80,000 units, calculate the fixed cost per unit. C.  If Flash Corporation makes 150,000 units, calculate the total variable.
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54) Waterfront Tours Company offers guided mini-bus tours through downtown Toronto. The tour business is highly regulated by the city. Waterfront Tours Company has the following operating costs during July: Monthly depreciation expense on non-automotive equipment$5,250 Fee paid to the City of Toronto12% of ticket revenue Cost of souvenir set of postcards given.
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50) Ava's Needlework is a small e-tail business specializing in the hand crocheted hats for infants and toddlers over the web. The business is owned by a sole proprietor and operated out of her home. Results for last year are as follows: AVA'S NEEDLEWORK Income  Statement December 31 Sales revenue$789,600 Cost of goods sold.  (532,000) Gross.
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55) Jetboat Tours Company offers guided jet boat rides on the Ottawa River. The tour business is highly regulated by the municipal government. Jet Boat Tours Company has the following operating costs during July: Monthly depreciation expense on equipment$7,625 Fee paid to the Municipal Government for docking etc16% of ticket revenue Cost of.
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17) Using account analysis, what type of cost is the purchase of a cup of coffee on the way to school? A) Fixed B) Mixed C) Step D) Variable 18) Using account analysis, what type of cost is a student activity pass that costs $50 plus $5.00 per event? A) Fixed B) Mixed C) Step D) Variable 19) Manufacturing overhead.
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