WHAT IS THE TOTAL AMOUNT OF THE COSTS LISTED ABOVE THAT ARE DIRECT COSTS OF THE COSMETICS DEPARTMENT?

21 May WHAT IS THE TOTAL AMOUNT OF THE COSTS LISTED ABOVE THAT ARE DIRECT COSTS OF THE COSMETICS DEPARTMENT?

The following cost data pertain to the operations of Rademaker Department Stores, Inc., for
the month of March.
Corporate headquarters building lease
$85,200
Cosmetics Department sales commissions–Northridge Store
Corporate legal office salaries
Store manager’s salary-Northridge Store
Heating-Northridge Store
Cosmetics Department cost of sales–Northridge Store
Central warehouse lease cost
Store security-Northridge Store
Cosmetics Department manager’s salary–Northridge Store

$5,610
$58,200
$14,600
$17,600
$39,700
$6,900
$19,500
$4,240

The Northridge Store is just one of many stores owned and operated by the company. The
Cosmetics Department is one of many departments at the Northridge Store. The central
warehouse serves all of the company’s stores.
What is the total amount of the costs listed above that are direct costs of the Cosmetics
Department?
A. $45,310
B. 49,550
C. $39,700
D. $97,790
2. Erkkila Inc. reports that at an activity level of 6,500 machine-hours in a month, its total
variable inspection cost is $426,080 and its total fixed inspection cost is $183,872.
What would be the average fixed inspection cost per unit at an activity level of 6,800 machinehours in a month? Assume that this level of activity is within the relevant range.
A. $27.04
B. $93.84
C. $28.29
D. $37.26

3. Younger Corporation reports that at an activity level of 2,600 units, its total variable cost is
$117,390 and its total fixed cost is $71,415.
Required:
For the activity level of 2,700 units, compute: (a) the total variable cost; (b) the total fixed cost;
(c) the total cost; (d) the average variable cost per unit; (e) the average fixed cost per unit; and (f)
the average total cost per unit. Assume that this activity level is within the relevant range.
(Round your "Average cost" to 2 decimal places and other answers to the nearest dollar
amount.)
A. Total Variable Cost
B. Total Fixed Cost
C. Total Cost
D. Average Variable Cost
E. Average Fixed Cost
F. Average Total Cost

Per Unit
Per Unit
Per Unit

4. Gould Corporation uses the following activity rates from its activity-based costing to assign
overhead costs to products:
Activities
Activity Rate
Setting up batches
$88.50 per batch
Processing customer orders
$78.99 per customer order
Assembling products
$13.86 per assembly hour
Data concerning two products appear below:
Product V09X
Number of batches
Number of customer orders
Number of assembly hours

69
20
492

Product A09X
12
9
697

How much overhead cost would be assigned to Product V09X using the activity-based costing
system?
A. $181.35
B. $130,548.78
C. $14,505.42
D. $6,106.50

5. Jeanlouis, Inc., manufactures and sells two products: Product D0 and Product D5. The
company has an activity-based costing system with the following activity cost pools, activity
measures, and expected activity:
Estimated
Expected Activity
Activity Cost Pools

Activity Measures

Overhead Cost

Product D0

Labor-related

DLHs

$313,743

3,600

Production orders

orders

70,264

300

General factory

MHs

253,555

4,300

Product D5

3,300 6,900
500

The total overhead applied to Product D5 under activity-based costing is closest to:
A. $319,252
B. $125,286
C. $304,920
D. $273,240
6. Ofarrell Corporation, a company that produces and sells a single product, has provided its
contribution format income statement for March.
Sales (7,200 units)
$338,400
194,400

Contribution margin

144,000

Fixed expenses

103,500

Net operating income

800

4,200 8,500

$637,562

Variable expenses

Total

$40,500

If the company sells 7,100 units, its net operating income should be closest to:
A. $40,500
B. $36,000
C. $38,500
D. $39,979
7. Dybala Corporation’s produces and sells a single product. Data concerning that product appear
below:
Per Unit Percent of Sales
Selling price
$150
100%
Variable expenses
90
60%

Contribution margin

$ 60

40%

The company is currently selling 5,000 units per month. Fixed expenses are $242,800 per month.
The marketing manager believes that a $6,000 increase in the monthly advertising budget would
result in a 190 unit increase in monthly sales. What should be the overall effect on the company’s
monthly net operating income of this change?
A. Decrease of $5,400
B. Increase of $11,400
C. Increase of $5,400
D. Decrease of $6,000
8. Data concerning Wang Corporation’s single product appear below: (Do not round your
intermediate calculations.)
Selling price per unit
$ 160.00
Variable expense per unit $ 64.00
Fixed expense per month $ 124,800
The break-even in monthly dollar sales is closest to:
A. $208,000
B. $291,200
C. $124,800
D. $416,000
9. Data concerning Cutshall Enterprises Corporation’s single product appear below:
Selling price per unit
$ 230.00
Variable expense per unit $ 98.50
Fixed expense per month $ 451,190
The unit sales to attain the company’s monthly target profit of $33,000 is closest to: (Do not
round your intermediate calculations.)
A. 3,431
B. 2,105
C. 4,916
D. 3,682
10. A cement manufacturer has supplied the following data:
Tons of cement produced and sold
225,000
Sales revenue
$929,000
Variable manufacturing expense
$298,000

Fixed manufacturing expense

$283,000

Variable selling and administrative expense

$166,500

Fixed selling and administrative expense
Net operating income

$83,000
$98,500

The company’s contribution margin ratio is closest to:
A. 37.5%
B. 50.0%
C. 69.5%
D. 10.6%
11. Gonyo Inc., which produces and sells a single product, has provided the following
contribution format income statement for December appears below:
Sales (5,000 units)
Variable expenses

$310,000
125,000

Contribution margin
Fixed expenses

185,000
106,100

Net operating income

$ 78,900

Required:
Redo the company’s contribution format income statement assuming that the company sells
5,200 units.
Net Operating income is:
12. The contribution margin ratio of Donath Corporation’s only product is 64%. The company’s
monthly fixed expense is $455,800 and the company’s monthly target profit is $41,800.
Required:
Determine the dollar sales to attain the company’s target profit. (Round your answer to the
nearest dollar amount.)

Sales:

13. A manufacturing company that produces a single product has provided the following data
concerning its most recent month of operations:
Selling price
$145
Units in beginning inventory
Units produced
Units sold
Units in ending inventory
Variable costs per unit:
Direct materials
Direct labor
Variable manufacturing overhead
Variable selling and administrative
Fixed costs:
Fixed manufacturing overhead
Fixed selling and administrative expenses

0
2,440
2,280
160

$49
$17
$17
$10
$85,400
$22,800

The total gross margin for the month under absorption costing is:
A. $61,560
B. $15,960
C. $107,760
D. $118,560
14. A manufacturing company that produces a single product has provided the following data
concerning its most recent month of operations:
Units in beginning inventory
0
Units produced
5,000
Units sold
4,900
Units in ending inventory
100

Variable costs per unit:
Direct materials
$ 61
Direct labor
$ 63
Variable manufacturing overhead $ 26
Variable selling and administrative $ 24
Fixed costs:
Fixed manufacturing overhead
$
105,000
Fixed selling and administrative $ 49,000
What is the variable costing unit product cost for the month?
A. $174 per unit
B. $195 per unit
C. $150 per unit
D. $151 per unit
15. Bartelt Inc., which produces a single product, has provided the following data for its most
recent month of operations:
Number of units produced
7,000
Variable costs per unit:
Direct materials
$149
Direct labor
$98
Variable manufacturing overhead
$6
Variable selling and administrative expense
$16
Fixed costs:
Fixed manufacturing overhead
$245,000
Fixed selling and administrative expense
$483,000
There were no beginning or ending inventories. The absorption costing unit product cost was:
A. $247 per unit
B. $288 per unit
C. $253 per unit
D. $373 per unit
16. Rehmer Corporation is working on its direct labor budget for the next two months. Each unit
of output requires 0.06 direct labor-hours. The direct labor rate is $9.00 per direct labor-hour. The
production budget calls for producing 4,300 units in June and 4,800 units in July.
Required:
Construct the direct labor budget for the next two months, assuming that the direct labor work
force is fully adjusted to the total direct labor-hours needed each month. (Round your answers
to 2 decimal places.)
June
Required production in units
Direct labor-hours per unit
Total direct labor-hours needed

July

Direct labor cost per hour
Total direct labor cost
17. A manufacturing company that has only one product has established the following standards
for its variable manufacturing overhead. Variable manufacturing overhead standards are based on
machine-hours.
Standard hours per unit of output
4.10 machine-hours
Standard variable overhead rate
$11.45 per machine-hour
The following data pertain to operations for the last month:
Actual hours

8,500

Actual total variable manufacturing overhead cost
Actual output

machinehours

$95,870
2,000 units

What is the variable overhead efficiency variance for the month?
A. $2,652 U
B. $7,133 F
C. $3,435 U
D. $7,133 U
18. The following materials standards have been established for a particular product:
Standard quantity per unit of output
Standard price

4.0 grams
$12.00 per grams

The following data pertain to operations concerning the product for the last month:
Actual materials purchased
Actual cost of materials purchased
Actual materials used in production
Actual output

2,900 grams
$ 33,785
2,200 grams
480 units

The direct materials purchases variance is computed when the materials are purchased.
Required:
What is the materials price variance for the month? (Input the amount as a positive value.
Leave no cells blank – be certain to enter "0" wherever required. Indicate the effect of each
variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect
(i.e., zero variance.)
Materials Price Variance
Choose Favorable or unfavorable
What is the materials quantity variance for the month? (Input the amount a as positive value.
Leave no cells blank – be certain to enter "0" wherever required. Indicate the effect of each

variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect
(i.e., zero variance.)
Materials Quantity Variance
Choose Favorable or unfavorable

19. The following standards for variable overhead have been established for a company that
makes only one product:
Standard hours per unit of output
Standard variable overhead rate

5.2 hours
$15.00 per hour

The following data pertain to operations for the last month:
Actual hours
Actual total variable overhead cost
Actual output