1.A local merchandiser purchases inventory that it subsequently sells to customers.During the month of May, the following costs (in dollars) were incurred:

Cost of inventory purchased and sold:$20, 000

Selling Expenses: $4000

Administrative Expensive:$5000

What was the product cost per unit if 1,000 units of inventory were purchased and sold during May?

a.$29

b.$26

c.$24

d.$25

#2 During its first month of operations, a manufacturer incurs the following costs (in dollars) related to activities within its factory.

Direct Materials - $20,000

Direct Labor - $40,000

Manufacturing Overhead - $25,000

What are the manufactures total product costs for the month?

a.$85,000

b.$65,000

c.$60,000

d.$45,000

#3 Which overhead cost is associated with unit level activity?

a.Power to run the equipment

b.Product design costs

c.Machine setup expenses

d.Property taxes

#4 What would be the appropriate cost drive to allocate overhead for a company that is labor intensive?

a.Number of labor hours

b.Totals sales dollars

c.Number of units produced

d.Total material cost