16.Assume the following (1) variable expenses = $281,000, (2) unit sales = 10,000, (3) the contribution margin ratio = 20%, and (4) net operating income = $10,000. Given these four assumptions, which of the following is true?

Multiple Choice

• The total fixed expenses = $56,200

• The total sales = $337,200

• The total contribution margin = $224,800

• The break-even point in sales dollars is $301,250

17.

Assume the following information for one of a companys variable expenses:

• The activity variance is $790 favorable.
• The actual amount of the expense is $8,300.
• The planned level of activity is 1,000 hours.
• The actual level of activity is 900 hours.

The cost formula for this expense must be:

Multiple Choice

• $8.20 per hour.

• $7.20 per hour.

• $7.90 per hour.

• $8.90 per hour.

18.

Assume that the amount of one of a companys variable expenses in its flexible budget is $40,000. The actual amount of the expense is $42,000 and the amount in the companys planning budget is $42,400. The activity variance for this expense is:

Multiple Choice

19.

Assume the following information appears in the standard cost card for a company that makes only one product:

	Standard Quantity or Hours		Standard Price or Rate			Standard Cost
Direct materials	5	pounds	$	12.10	per pound	$	60.50
Direct labor	2	hours	$	17.00	per hour	$	34.00
Variable manufacturing overhead	2	hours	$	3.00	per hour	$	6.00

During the most recent period, the following additional information was available:

• 20,000 pounds of material was purchased at a cost of $10.50 per pound.
• All of the material that was purchased was used to produce 3,900 units.
• 8,000 direct labor-hours were recorded at a total cost of $132,000.

What is the direct materials spending variance?

Garrison 17e Rechecks 2020-09-29

Multiple Choice

• $6,050 F

• $6,050 U

• $25,950 U

• $25,950 F

• $2,400 U.

• $2,400 F.

• $1,200 F.

• $1,200 U.

20.

Assume a companys estimated sales for January, February, and March are 39,000 units, 40,000 units, and 38,000 units, respectively. The company always maintains ending finished goods inventory equal to 10% of next months unit sales. What is the required production in units for January?

Multiple Choice

• 43,000 units

• 38,900 units

• 39,100 units

• 39,900 units