1. Assume a company had no jobs in progress at the beginning of July and no beginning inventories. It started and completed only two jobs during JulyJob Y and Job Z. The company uses a plantwide predetermined overhead rate based on direct labor-hours. The following additional information from the month of July is available for the company as a whole and for Jobs Y and Z:

Estimated total fixed manufacturing overhead	$	13,000
Estimated variable manufacturing overhead per direct labor-hour	$	1.00
Estimated total direct labor hours to be worked		2,000
Total actual manufacturing overhead costs incurred	$	12,800

	Job Y			Job Z
Direct materials	$	13,000		$	8,000
Direct labor cost	$	21,000		$	7,500
Actual direct labor hours worked		1,400			500

Assuming Job Z contains 200 units and that the company applies a markup of 60% when establishing its selling prices, the price per unit that it would choose for Job Z is closest to:

rev: 06_09_2020_QC_CS-208650

Multiple Choice

• $134

• $144

• $154

• $164

2. Assume a company started and completed numerous jobs during Julyone of which was Job Z. The company uses two departmental predetermined overhead rates. The rate in the Machining Department is based on machine-hours and the rate in the Assembly Department is based on direct labor-hours. The following additional information from the month of July is available for the company as a whole and for Jobs Z:

	Machining				Assembly
Estimated total fixed manufacturing overhead	$	48,000			$	30,000
Estimated variable manufacturing overhead per machine-hour	$	1.50
Estimated variable manufacturing overhead per direct labor-hour					$	2.00
Estimated total machine-hours to be used		12,000
Estimated total direct labor hours to be worked						10,000

Job Z	Machining					Assembly
Direct materials		$	650				$	700
Direct labor		$	200				$	900
Machine-hours			40
Direct labor-hours								60

What is the total job cost for Job Z?

Multiple Choice

• $2,890

• $2,910

• $2,940

• $2,970

3. Assume a company started and completed numerous jobs during Julyone of which was Job Z. The company uses two departmental predetermined overhead rates. The rate in the Machining Department is based on machine-hours and the rate in the Assembly Department is based on direct labor-hours. The following additional information from the month of July is available for the company as a whole and for Jobs Z:

	Machining				Assembly
Estimated total fixed manufacturing overhead	$	48,000			$	30,000
Estimated variable manufacturing overhead per machine-hour	$	1.50
Estimated variable manufacturing overhead per direct labor-hour					$	2.00
Estimated total machine-hours to be used		12,000
Estimated total direct labor hours to be worked						10,000

Job Z	Machining					Assembly
Direct materials		$	650				$	700
Direct labor		$	200				$	900
Machine-hours			40
Direct labor-hours								60

If Job Z contains 50 units, the unit product cost for Job Z is closest to:

rev: 04_27_2020_QC_CS-208650, 06_15_2020_QC_CS-208650

Garrison 17e Rechecks 2020-06-22

Multiple Choice

• $58.20

• $59.10

• $59.20

• $59.40

4. A company makes two productsProduct A and B. Data regarding the two products follow:

	Direct Labor-Hours per Unit	Annual Production
Product A	0.75	20,000 units
Product B	0.50	50,000 units

Additional information is as follows:

1. Product A requires $15 in direct materials per unit, and Product B requires $8.
2. The direct labor wage rate is $18 per hour.
3. The companys activity-based absorption costing system has the following activity cost pools:

	Estimated					Expected Activity
Activity Cost Pool (and Activity Measures)	Overhead Cost					Product A			Product B		Total
Machine setups (number of setups)		$	100,000				100		300		400
Special processing (machine-hours)		$	200,000				2,000		6,000		8,000
General factory (Direct labor-hours)		$	150,000				15,000		25,000		40,000

Using activity-based absorption costing, what is the total manufacturing cost (including direct materials, direct labor, and manufacturing overhead) for Product B?

Multiple Choice

• $1,168,750

• $1,125,890

• $1,085,250

• $1,220,500

5. Which of the following is a valid approach for calculating the cost of unused capacity?

Multiple Choice

• (Actual amount of the allocation base Amount of allocation base at capacity) Predetermined overhead rate

• (Amount of allocation base at capacity Actual amount of the allocation base) Predetermined overhead rate

• (Amount of allocation base at capacity Actual amount of the allocation base) Predetermined overhead rate

• (Actual amount of the allocation base Amount of allocation base at capacity) Predetermined overhead rate