1:

Flesch Corporation produces and sells two products. In the most recent month, Product C90B had sales of $25,000 and variable expenses of $8,750. Product Y45E had sales of $27,300 and variable expenses of $13,650. The fixed expenses of the entire company were $16,200. If the sales mix were to shift toward Product C90B with total dollar sales remaining constant, the overall break-even point for the entire company:

Multiple Choice

• would not change.

• could increase or decrease.

• would decrease.

• would increase.

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2:

The following costs were incurred in May:

Direct materials	$47,300
Direct labor	$31,400
Manufacturing overhead	$25,400
Selling expenses	$15,200
Administrative expense	$35,600

Prime costs during the month totaled:

Multiple Choice

• $104,100

• $154,900

• $56,800

• $78,700

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3:

Farris Corporation, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price	$96
Units in beginning inventory	0
Units produced	8,750
Units sold	8,350
Units in ending inventory	400

Variable costs per unit:
Direct materials	$ 14
Direct labor	$ 56
Variable manufacturing overhead	$ 2
Variable selling and administrative expense	$ 6
Fixed costs:
Fixed manufacturing overhead	$131,250
Fixed selling and administrative expense	$ 8,400

What is the net operating income (loss) for the month under variable costing?

Multiple Choice

• $6,000

• $10,650

• $16,650

• $(18,150)

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4:

Corbel Corporation has two divisions: Division A and Division B. Last month, the company reported a contribution margin of $47,700 for Division A. Division B had a contribution margin ratio of 35% and its sales were $231,000. Net operating income for the company was $27,200 and traceable fixed expenses were $59,700. Corbel Corporation's common fixed expenses were:

Multiple Choice

• $41,650

• $128,550

• $59,700

• $101,350

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5:

Evan's Electronics Boutique sells a digital camera. The following information was reported for the digital camera last month:

Sales	$ 17,600
Variable expenses	9,680
Contribution margin	7,920
Fixed expenses	3,600
Net operating income	$ 4,320

Evan's margin of safety in dollars and percentage are closest to:

Multiple Choice

• $9,600 and 55%

• $9,600 and 120%

• $8,000 and 83%

• $8,000 and 45%

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6:

Krepps Corporation produces a single product. Last year, Krepps manufactured 30,030 units and sold 24,700 units. Production costs for the year were as follows:

Direct materials	$243,243
Direct labor	$126,126
Variable manufacturing overhead	$237,237
Fixed manufacturing overhead	$420,420

Sales totaled $1,272,050 for the year, variable selling and administrative expenses totaled $133,380, and fixed selling and administrative expenses totaled $195,195. There was no beginning inventory. Assume that direct labor is a variable cost.

Under variable costing, the company's net operating income for the year would be:

Multiple Choice

• $74,620 lower than under absorption costing.

• $28,249 higher than under absorption costing.

• $28,249 lower than under absorption costing.

• $74,620 higher than under absorption costing.