Question
24. If total sales are $100,000, total variable costs are $30,000, and total fixed costs are $40,000, the contribution margin is $100,000. $ 40,000. $
24.
If total sales are $100,000, total variable costs are $30,000, and total fixed costs are $40,000, the contribution margin is
$100,000.
$ 40,000.
$ 60,000.
$ 70,000.
none of these.
25.
Which of the following is NOT commonly found on a functional income statement prepared in accordance with GAAP?
Cost of Goods Sold
Selling Expenses
Contribution Margin
Administrative Expenses
Gross Margin
26.
The following cost data are available for Miner Company:
Month
Total Utility Costs
Number of Units Sold
January
$28,000
4,000 units
February
$22,000
3,000 units
March
$25,000
3,500 units
April
$39,000
6,500 units
May
$41,000
7,000 units
June
$42,000
8,000 units
Given this data and using the high-low method of mixed cost analysis, the monthly fixed cost portion of utility costs amounts to
$13,000.
$10,000.
$ 7,000.
$ 4,000.
none of these.
27.
Smith Company sells a single product at a selling price of $30 per unit. Variable costs are $12 per unit and fixed costs are $14,000. Smith's break-even point in either units or sales dollars is
1,380 units.
$69,000.
3,450 units.
$207,000.
none of these.
28.
Last year Easton Company reported sales revenues of $720,000, a contribution margin as a percentage of sales revenue of 30% and fixed costs of $240,000. Based on this information, the break-even point in sales dollars was
$640,000.
$880,000.
$744,000.
$800,000.
none of these.
29.
If variable costs are $15 per unit, sales revenues are $20 per unit, and the break-even point is 2,500 units, fixed costs are
$ 500.
$ 2,500.
$12,500.
$37,500.
none of these.
30.
Grate Corporation's product has a selling price per unit of $15 and a per-unit variable cost of $8. Its fixed costs are $14,000. How many units must the company sell to earn a profit of $35,000?
2,334 units
3,000 units
6,000 units
6,125 units
none of these
31.
When other factors remain constant, a decrease in fixed costs
increases the breakeven units.
decreases the breakeven units.
has no effect on the breakeven units.
32.
Star of the Sea School has annual fixed costs of $150,000 and variable costs of $550 per student. Star of the Sea expects 345 students for the upcoming year. If the school wishes to earn a profit of $10,000, what should tuition per student be (round answer to nearest $)?
$ 957
$1,014
$1,233
$1,346
none of these
33.
The contribution margin ratio is 25% for Grain Company and the break-even point in sales is $200,000. If Grain Company desires net income of $60,000, sales revenues would have to be
$260,000.
$440,000.
$280,000.
$240,000.
None of these.
34.
The following cost information is for Rocky Company.
Actual results:
Total cost of purchasing material
$15,000
Number of labor hours worked
450 hours
Number of material pounds used in production
2,000 pounds
Number of units produced
200 units
Number of material pounds purchased
1,500 pounds
Total labor cost
$12,500
Leslie Company has established the following standards:
Price per pound of materials
$8.00 per pound
Standard labor rate
$30.00 per hour
During the year, Rocky Company DEBITED Work-in-Process Inventory for a total of $12,000 of direct labor cost. Given these data, which ONE of the following PAIRS would be included in the summary journal entry needed to record the information related to DIRECT LABOR? Note: Assume that the wages have not yet been paid in cash.
Credit Labor Efficiency Variance for $1,000; Debit Labor Rate Variance for $1,500
Debit Labor Efficiency Variance for $1,000; Credit Labor Rate Variance for $1,500
Credit Labor Efficiency Variance for $1,500; Debit Labor Rate Variance for $1,000
Credit Labor Efficiency Variance for $500; Debit Labor Rate Variance for $1,000
Debit Labor Efficiency Variance for $500; Credit Labor Rate Variance for $1,000
Debit Labor Efficiency Variance for $1,500; Credit Labor Rate Variance for $1,000
Debit Labor Efficiency Variance for $1,000; Credit Labor Rate Variance for $500
Credit Labor Efficiency Variance for $1,000; Debit Labor Rate Variance for $500
35.
The following information is available for Aina Company.
Estimated for Year 1:
Estimated total manufacturing overhead
$100,000
Estimated direct labor hours
40,000 hours
Actual data for Year 1 are as follows:
Actual total manufacturing overhead
$90,000
Variable overhead spending variance
$22,500 favorable
The number of units produced during Year 1 was 1,000. The standard number of direct labor hours to be worked to produce each unit is 50. Given this information, the variable manufacturing overhead efficiency variance is
$10,000 unfavorable
$10,000 favorable
$25,000 unfavorable
$25,000 favorable
$12,500 unfavorable
$12,500 favorable
$32,500 unfavorable
$32,500 favorable
36.
Solar Salt Company has two divisions. Sales, direct materials cost, and direct labor cost data for Solar Salt's two divisions are not available. However, manufacturing overhead and gross profit data for the two divisions are available, as follows.
Agricultural Products
Retail Products
Manufacturing overhead*
$450,000
$250,000
Gross profit
150,000
100,000
*Manufacturing overhead is allocated to production based on the amount of direct labor cost. Solar Salt has determined that its total manufacturing overhead cost of $700,000 is a mixture of unit-level costs, batch-level costs, and product line costs. Solar Salt has assembled the following information concerning the manufacturing overhead costs, the annual number of units produced, production batches, and number of product lines in each division.
Total Manufacturing Overhead Costs
Agricultural Products
Retail Products
Unit-level overhead
$210,000
7,500 units
13,500 units
Batch-level overhead
280,000
50 batches
90 batches
Product line overhead
210,000
10 lines
18 lines
$700,000
How much will GROSS PROFIT in each of the divisions be if Solar Salt adopts an activity-based costing system?
Agricultural, $50,000; Retail, $200,000
Agricultural, loss of $50,000; Retail, $300,000
Agricultural, $350,000; Retail, loss of$100,000
Agricultural, $350,000; Retail, $100,000
Agricultural, $350,000; Retail, $300,000
Agricultural, $250,000; Retail, $450,000
Agricultural, loss of $50,000; Retail, loss of$100,000
Agricultural, $150,000; Retail, $100,000
37.
The following information is for Harold Company. The "percent completed" numbers are for conversion costs; all direct materials are added at the beginning of the production process. For the beginning inventory, the percentage given is the percentage that was already completed as of the beginning of the period. For the ending inventory, the percentage given is the percentage that was completed as of the end of the period.
Units
Percent Completed
Direct Materials Costs
Conversion Costs
Beginning work in process
6,000 units
20%
$10,000
$5,000
Costs added this period
$52,800
$43,600
Ending work in process
10,000 units
30%
Units completed and transferred during the period
20,000 units
Compute the TOTAL COST TRANSFERRED OUT DURING THE PERIOD THAT WAS ASSOCIATED WITH THE 6,000 BEGINNING WIP INVENTORY UNITS. Assume a FIFO flow of costs.
$24,600
$27,100
$25,200
$20,160
38.
The following information is for Stahc Company. The "percent completed" numbers are for conversion costs; all direct materials are added at the beginning of the production process. For the beginning inventory, the percentage given is the percentage that was already completed as of the beginning of the period. For the ending inventory, the percentage given is the percentage that was completed as of the end of the period.
Units
Percent Completed
Direct Materials Costs
Conversion Costs
Beginning work in process
12,000 units
70%
$10,000
$5,000
Costs added this period
$56,000
$49,200
Ending work in process
6,000 units
80%
Units completed and transferred during the period
20,000 units
Compute the total cost of goods STARTED AND COMPLETED during the period. Assume a FIFO flow of costs.
$56,000
$64,200
$101,600
$41,000
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started