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$13,000Estimated variable manufacturing overhead per direct labor-hour$1.00Estimated total direct labor hours to be worked2,000Total actual manufacturing overhead costs incurred$12,800Job YJob ZDirect materials$13,000$8,000Direct labor cost$21,000$7,500Actual direct labor hours worked1,400500

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:

Multiple Choice

• $134
• $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:

MachiningAssemblyEstimated total fixed manufacturing overhead$48,000$30,000Estimated variable manufacturing overhead per machine-hour$1.50Estimated variable manufacturing overhead per direct labor-hour$2.00Estimated total machine-hours to be used12,000Estimated total direct labor hours to be worked10,000Job ZMachiningAssemblyDirect materials$650$700Direct labor$200$900Machine-hours40Direct labor-hours60

What is the total job cost for Job Z?

Multiple Choice

• $2,890
• $2,910
• $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:

MachiningAssemblyEstimated total fixed manufacturing overhead$48,000$30,000Estimated variable manufacturing overhead per machine-hour$1.50Estimated variable manufacturing overhead per direct labor-hour$2.00Estimated total machine-hours to be used12,000Estimated total direct labor hours to be worked10,000Job ZMachiningAssemblyDirect materials$650$700Direct labor$200$900Machine-hours40Direct labor-hours60

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

Multiple Choice

• $58.20
• $59.10
• $59.40

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

Direct Labor-Hours

per UnitAnnual

ProductionProduct A0.7520,000 unitsProduct B0.5050,000 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 company's activity-based absorption costing system has the following activity cost pools:

EstimatedExpected ActivityActivity Cost Pool (and Activity Measures)Overhead CostProduct AProduct BTotalMachine setups (number of setups)$100,000100300400Special processing (machine-hours)$200,0002,0006,0008,000General factory (Direct labor-hours)$150,00015,00025,00040,000

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
• $1,085,250
• $1,220,500

5. Which of the following statements is true when a company uses a predetermined overhead rate based on capacity?

Multiple Choice

• The amount of overhead assigned to cost objects, such as products and customers, will include some unused capacity costs.
• The unused capacity cost will fluctuate from one period to the next due solely to the fact that the company's level of output increases or decreases from one period to the next.
• The amount of overhead assigned to cost objects, such as products and customers, will fluctuate from one period to the next due solely to the fact that the company's level of output increases or decreases from one period to the next.

6. Assume a company reported the following information for this year:

Budgeted (estimated) production80,000unitsBudgeted sales80,000unitsProduction capacity100,000unitsSelling price$50per unitVariable manufacturing cost$18per unitEstimated total manufacturing overhead cost (all fixed)$700,000Selling and administrative expenses (all fixed)$250,000Beginning inventories$0

Using a predetermined overhead rate based on capacity with "units produced" as the allocation base, the company's budgeted income statement would report unused capacity costs that are closest to:

Multiple Choice

• $175,000
• $165,000
• $140,000

6.

Assume a company reported the following information for this year:

Budgeted (estimated) production80,000unitsBudgeted sales80,000unitsProduction capacity100,000unitsSelling price$25per unitVariable manufacturing cost$12per unitEstimated total manufacturing overhead cost (all fixed)$700,000Selling and administrative expenses (all fixed)$250,000Beginning inventories$0

Using a predetermined overhead rate based on capacity with "units produced" as the allocation base, the company's budgeted income statement would report a gross margin that is closest to:

rev: 04_16_2020_QC_CS-208650, 06_15_2020_QC_CS-208650

Multiple Choice

• $1,300,000
• $480,000
• $90,000