29. If sales are $500,000, variable costs are $300,000, and fixed costs are $$240,000, what is the contribution margin ratio. a) b) c) d) e) 40% 48% 52% 55% 60% 30. A company has the choice of either selling 500 defective units as scrap or rebuilding them. The company could sell the defective units as they are for $7.00 per unit. Altenatively, it could rebuild them with incremental costs of $2.00 per unit for materials, $3 per unit for labor, and $1 per unit for overhead, and then sell the rebuilt units for $15 each. What should the company do? a) Sell the units as scrap. b) Throw the units away c) It does not matter because both alternatives have the same result. d) Neither sell nor rebuild because both alternatives produce a loss. Instead, the company should store the units permanently e) Rebuild the units 31. Which of the following may be part of a journal entry to increase cost of goods sold? a) Credit Cost of Goods Sold b) Debit Factory Overhead c) Debit Raw Materials d) Credit Finished Goods e) None of the above. 32. A sawmill bought a shipment of logs for $40,000. When cut, the logs produced 1 million board feet of lumber in the following grades Type 1-400,000 bd. ft. priced to sell at $0.12 per bd. ft. Type 2-400,000 bd. ft. priced to sell at $0.06 per bd. ft. Type 3-200,000 bd. ft. priced to sell at $0.04 per bd. ft How much cost should be allocated to Type 1 and Type 2, respectively? Iype 1Iype 2 a) $16,000 $16,000 b) $24,000 $12,000 C) $40,000 $24,000 d) $13,333 $4,444 e) $24,000 $8,000 For which of the following businesses would the process cost system be most appropriate? a) Crude oil refinery b) Automobile repair shop c) Custom furniture manufacturer d) Commercial custom building contractor e) Both "c" and "d 33