78 - A business operated at 100% of capacity during its first month and incurred the following costs:

Production costs (20,800 units):
??? Direct materials	$171,700
??? Direct labor	222,500
??? Variable factory overhead	244,200
??? Fixed factory overhead	93,900	$732,300
Operating expenses:
??? Variable operating expenses	$129,800
??? Fixed operating expenses	42,500	172,300

If 2,000 units remain unsold at the end of the month, what is the amount of inventory that would be reported on the variable costing balance sheet?

a.$61,380

b.$73,865

c.$70,413

d.$86,981

73-

The level of inventory of a manufactured product has increased by 7,847 units during a period. The following data are also available:

	Variable	Fixed
Unit manufacturing costs of the period	$13	$7
Unit operating expenses of the period	$2	$3

What would be the effect on income from operations if variable costing is used rather than absorption costing?

a.$54,929 decrease

b.$78,470 decrease

c.$78,470 increase

d.$54,929 increase

80-The following data relate to direct labor costs for the current period:

Standard costs	7,500 hours at $11.70
Actual costs	6,200 hours at $10.60

What is the direct labor time variance?

a.$15,210 unfavorable

b.$13,780 favorable

c.$13,780 unfavorable

d.$15,210 favorable

79-

A business operated at 100% of capacity during its first month and incurred the following costs:

Production costs (19,300 units):
??? Direct materials	$174,400
??? Direct labor	221,400
??? Variable factory overhead	252,900
??? Fixed factory overhead	100,300	$749,000
Operating expenses:
??? Variable operating expenses	$120,800
??? Fixed operating expenses	46,700	167,500

If 1,500 units remain unsold at the end of the month, what is the amount of inventory that would be reported on the absorption costing balance sheet?

a.$59,806

b.$58,215

c.$50,417

d.$71,231

136

If sales totaled $221,768 for the current year (11,672 units at $19 each) and planned sales totaled $166,400 (12,800 units at $13 each), the effect of the unit price factor on the change in sales is a:

a.$70,032 increase

b.$70,032 decrease

c.$76,800 increase

d.$55,368 increase

72-

The level of inventory of a manufactured product has increased by 8,505 units during a period. The following data are also available:

	Variable	Fixed
Unit manufacturing costs of the period	$14	$6
Unit operating expenses of the period	$4	$5

What would be the effect on income from operations if absorption costing is used rather than variable costing?

a.$51,030 increase

b.$51,030 decrease

c.$93,555 decrease

d.$93,555 increase