29 Jun Question . Manufacturing overhead cons
Question
. Manufacturing overhead consists of:
a. all manufacturing costs.
b. indirect materials but not indirect labor.
c. all manufacturing costs, except direct materials and direct labor.
d. indirect labor but not indirect materials.
2.Each of the following would be a period cost except:
a. the salary of the company president’s secretary.
b. the cost of a general accounting office.
c. depreciation of a machine used in manufacturing.
d. sales commissions.
3.In describing the cost formula equation Y = a + bX, which of the following statements is correct?
a. “X” is the dependent variable.
b. “a” is the fixed component.
c. In the high-low method, “b” equals change in activity divided by change in costs.
d. As “X” increases “Y” decreases.
4. Which one of the following costs should NOT be considered a direct cost of serving a particular customer who orders a customized personal computer by phone directly from the manufacturer?
a. the cost of the hard disk drive installed in the computer.
b. the cost of shipping the computer to the customer.
c. the cost of leasing a machine on a monthly basis that automatically d. tests hard disk drives before they are installed in computers.
d. the cost of packaging the computer for shipment.
5. The term differential cost refers to:
a. a difference in cost which results from selecting one alternative instead of another.
b. the benefit forgone by selecting one alternative instead of another.
c. a cost which does not involve any dollar outlay but which is relevant to the decision-making process.
d. a cost which continues to be incurred even though there is no activity.
6.When a decision is made among a number of alternatives, the benefit that is lost by choosing one alternative over another is the:
a. realized cost.
b. opportunity cost.
c. conversion cost.
d. accrued cost.
7.In September direct labor was 40% of conversion cost. If the manufacturing overhead for the month was $66,000 and the direct materials cost was $20,000, the direct labor cost was:
a. $13,333
b. $44,000
c. $99,000
d. $30,000
66000/.6 = 110000*.4 = 44000
8. At a volume of 10,000 units, Company P incurs $30,000 in factory overhead costs, including $10,000 in fixed costs. Assuming that this activity is within the relevant range, if volume increases to 12,000 units, Company P would expect to incur total factory overhead costs of:
a. $36,000
b. $34,000
c. $30,000
d.$32,000
20000/10000*12000 +10000 = 34000
9. Haar Inc. is a merchandising company. Last month the company’s cost of goods sold was $61,000. The company’s beginning merchandise inventory was $11,000 and its ending merchandise inventory was $21,000. What was the total amount of the company’s merchandise purchases for the month?
a. $61,000
b. $51,000
c. $71,000
d. $93,000
61000+21000-11000 = 71000
10. At a sales volume of 35,000 units, Thoma Corporation’s sales commissions (a cost that is variable with respect to sales volume) total $448,000.
To the nearest whole cent, what should be the average sales commission per unit at a sales volume of 36,800 units? (Assume that this sales volume is within the relevant range.)
a. $13.49
b. $12.17
c. $12.80
d.$12.49
448000/35000 = 12.8
12. Fiene Sales, Inc., a merchandising company, reported sales of 2,200 units in June at a selling price of $600 per unit. Cost of goods sold, which is a variable cost, was $364 per unit. Variable selling expenses were $23 per unit and variable administrative expenses were $33 per unit. The total fixed selling expenses were $30,500 and the total administrative expenses were $55,300.
The contribution margin for June was:
$1,111,000
$396,000
$310,200
$519,200
13. Getchman Marketing, Inc., a merchandising company, reported
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