1.

During the month of September, direct labor cost totaled $9,150 and direct labor cost was 30% of prime cost. If total manufacturing costs during September were $78,400, the manufacturing overhead was:

$30,500$18,900$47,900$66,800

2.

A manufacturing company prepays its insurance coverage for a three-year period. The premium for the three years is $4,980 and is paid at the beginning of the first year. Eighty percent of the premium applies to manufacturing operations and twenty percent applies to selling and administrative activities. What amounts should be considered product and period costs respectively for the first year of coverage?

Product

Period

$4,980

$0

$3,984

$996

$2,656

$664

$1,328

$332

3.

Carbaugh Corporation has provided the following production and average cost data for two levels of monthly production volume. The company produces a single product.

Production volume	6,000	units	7,000	units
Direct materials	$77.90	per unit	$77.90	per unit
Direct labor	$51.20	per unit	$51.20	per unit
Manufacturing overhead	$73.40	per unit	$65.30	per unit

The best estimate of the total cost to manufacture 6,700 units is closest to:(Do not round intermediate calculations.)

$1,317,060 $1,323,765 $1,285,770 $1,334,940

4.

A soft drink bottler incurred the following factory utility cost: $3,486 for 950 cases bottled and $3,592 for 1,500 cases bottled. Factory utility cost is a mixed cost containing both fixed and variable components. The variable factory utility cost per case bottled is closest to:

$3.67 $0.19 $2.39 $2.32

5.

Supply costs at Lattea Corporation's chain of gyms are listed below:

	Client-Visits	Supply Cost
March	11,660	$28,574
April	11,456	$28,408
May	11,988	$28,832
June	13,300	$28,918
July	11,720	$28,635
August	11,206	$28,234
September	12,000	$28,833
October	11,691	$28,591
November	11,839	$28,716

Management believes that supply cost is a mixed cost that depends on client-visits. Use the high-low method to estimate the variable and fixed components of this cost, Compute the variable component first, rounding off to the nearest whole cent. Then compute the fixed component, rounding off to the nearest whole dollar. Those estimates would be closest to:(Round your Variable cost per unit to 2 decimal places.)

$2.02 per client-visit; $28,636 per month $.91 per client-visit; $17,471 per month $0.37 per client-visit; $24,024 per month $0.33 per client-visit; $24,529 per month

6.

The following cost data pertain to the operations of Swestka Department Stores, Inc., for the month of July.

Corporate headquarters building lease	$85,400
Cosmetics Department sales commissions--Northridge Store	$5,000
Corporate legal office salaries	$65,000
Store manager's salary-Northridge Store	$19,600
Heating-Northridge Store	$11,500
Cosmetics Department cost of sales--Northridge Store	$32,700
Central warehouse lease cost	$8,200
Store security-Northridge Store	$17,600
Cosmetics Department manager's salary--Northridge Store	$4,680

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?

$37,700 $84,360 $42,380 $32,700

7.

At a sales volume of 39,500 units, Thoma Corporation's sales commissions (a cost that is variable with respect to sales volume) total $505,600.

To the nearest whole cent, what should be the average sales commission per unit at a sales volume of 41,900 units? (Assume that this sales volume is within the relevant range.)

$12.80 $12.49 $12.17 $13.49

8.

Erkkila Inc. reports that at an activity level of 6,000 machine-hours in a month, its total variable inspection cost is $425,330 and its total fixed inspection cost is $162,477.

What would be the average fixed inspection cost per unit at an activity level of 6,300 machine-hours in a month? Assume that this level of activity is within the relevant range.

$25.79 $97.97 $27.08 $43.81 9.

Inspection costs at one of Iuliano Corporation's factories are listed below:

	Units produced	Inspection cost
February	908	$	16,512
March	955	$	16,900
April	914	$	16,565
May	898	$	16,410
June	920	$	16,594
July	905	$	16,480
August	922	$	16,632
September	862	$	16,030
October	901	$	16,438

Management believes that inspection cost is a mixed cost that depends on units produced.

Using the high-low method, the estimate of the fixed component of inspection cost per unit produced is closest to:(Round the intermediate calculations to two decimal places.)

$16,420.00 $16,031.00 $16,411.00 $7,970.75

10.

Nikkel Corporation, a merchandising company, reported the following results for July:

Sales	$413,000
Cost of goods sold (all variable)	$169,100
Total variable selling expense	$20,700
Total fixed selling expense	$17,900
Total variable administrative expense	$13,100
Total fixed administrative expense	$30,400

The gross margin for July is:

$364,700 $243,900 $161,800 $210,100 11.

Salvadore Inc., a local retailer, has provided the following data for the month of September:

Merchandise inventory, beginning balance	$44,000
Merchandise inventory, ending balance	$47,500
Sales	$268,200
Purchases of merchandise inventory	$137,300
Selling expense	$17,400
Administrative expense	$52,500

The cost of goods sold for September was:

$137,300 $207,200 $140,800 $133,800