11. Which of the following costs is least likely to be a variable cost?

1. sales commissions
2. direct labor
3. indirect materials
4. supervisory salaries

12. Which of the following components are included in a mixed cost?

1. a sunk cost and an opportunity cost
2. a fixed cost and a variable cost
3. a manufacturing cost and a selling cost
4. a product cost and a period cost

13. Karis Kookies has total costs of $5,000 when 2,000 units are produced and $11,000 when 5,000 units are produced. What is the variable cost per unit?

1. $2.50
2. $2.20
3. $2.00
4. $0.50

14. Which of the following items appears on a contribution margin income statement but not on a GAAP income statement?

A. Sales

B. Gross margin

C. Net income

D. Contribution margin

15. Well Water Inc. wants to produce and sell a new flavored water. In order to penetrate the market, the product will have to sell at $2.00 per 12 oz. bottle. The following data has been collected:

Annual sales 50,000 bottles

Projected selling and administrative costs $8,000

Desired profit $70,000

The target cost per bottle is

a. $0.44.

b. $0.60.

c. $0.16.

d. $0.40.