Hayes Inc. provided the following information for the year 2015:

Beginning inventory	170 units
Units produced	820 units
Units sold	869 units
Selling price	$220/unit
Direct materials	$42/unit
Direct labor	$23/unit
Variable manufacturing overhead	$22/unit
Fixed manufacturing overhead	$31,980/yr
Variable selling/administrative costs	$15/unit
Fixed selling/administrative costs	$22,500/yr

What is the unit product cost for the year using variable costing?

$126

$87

$102

$163

Sea Company reports the following information regarding its production cost.

Units produced	53,000 units
Direct labor	$46 per unit
Direct materials	$39 per unit
Variable overhead	$28 per unit
Fixed overhead	$116,000 in total

Compute production cost per unit under variable costing.

$39.00

$115.19

$113.00

$85.00

$46.00

Sea Company reports the following information regarding its production cost:

Units produced	46,000 units
Direct labor	$39 per unit
Direct materials	$32 per unit
Variable overhead	$21 per unit
Fixed overhead	$115,000 in total

Compute production cost per unit under absorption costing.

$32.00

$94.50

$92.00

$71.00

$39.00

Which of the following costing methods charges all manufacturing costs to its products?

Direct costing

ABC costing

Variable costing

Absorption costing

Which of the following statements is true regarding variable costing?

It is a traditional costing approach.

Only manufacturing costs that change in total with changes in production level are included in product costs.

It is not permitted to be used for managerial reporting.

It treats overhead in the same manner as absorption costing.

It makes it easier to manipulate earnings with changes in production levels.

Bengal Co. provides the following sales forecast for the next three months:

	July	August	September
Sales units	5,200	5,900	5,760

The company wants to end each month with ending finished goods inventory equal to 30% of the next month's sales. Finished goods inventory on June 30 is 1,560 units. The budgeted production units for July are:

6,760 units.

3,640 units.

6,970 units.

3,120 units.

5,410 units.

Flack Corporation provides the following information for its December budgeting process:

The November 30 inventory was 1,760 units.

Budgeted sales for December are 4,400 units.

Desired December 31 inventory is 3,080 units.

Budgeted purchases are:

3,080 units.

7,480 units.

5,720 units.

4,400 units.

6,160 units.

Bioclean Co. sells a biodegradable cleaning product and has predicted the following sales for the first four months of the current year:

	Jan.	Feb.	March	April
Sales in units	2,700	2,900	3,100	2,600

Ending inventory for each month should be 20% of the next month's sales, and the December 31 inventory is consistent with that policy. How many units should be purchased in February?

2,940.

3,520.

2,980.

2,900.

2,860.

Junior Snacks reports the following information from its sales budget:

Expected Sales:	October	$151,000
	November	159,000
	December	195,000

All sales are on credit and are expected to be collected 35% in the month of sale and 65% in the month following sale. The total amount of cash expected to be received from customers in November is:

$153,800.

$98,150.

$159,000.

$257,150.

$55,650.

Justin Company's budget includes the following credit sales for the current year: September, $41,000; October, $52,000; November, $46,000; December, $48,000. Experience has shown that payment for the credit sales is received as follows: 20% in the month of sale, 55% in the first month after sale, 22% in the second month after sale, and 3% is uncollectible. How much cash can Justin Company expect to collect in November as a result of current and past credit sales?

$49,620.

$44,220.

$35,420.

$46,000.

$46,820.

Trago Company manufactures a single product and has a JIT policy that ending inventory must equal 10% of the next month's sales. It estimates that May's ending inventory will consist of 28,400 units. June and July sales are estimated to be 284,000 and 294,000 units, respectively. Compute the number of units to be produced that would appear on the company's production budget for the month of June.

255,600 units.

313,400 units.

285,000 units.

284,000 units.

291,160 units.

Operating budgets include all of the following except the:

Sales budget.

Budgeted balance sheet.

Production budget.

Selling expense budget.

General and administrative expense budget.

The usual starting point for preparing a master budget is forecasting or estimating:

Expenditures.

Sales.

Production.

Income.

Cash payments.

Bengal Co. provides the following sales forecast for the next three months:

	July	August	September
Sales units	5,000	5,700	5,560

The company wants to end each month with ending finished goods inventory equal to 25% of the next month's sales. Finished goods inventory on June 30 is 1,250 units. The budgeted production units for July are:

6,250 units.

3,750 units.

6,425 units.

2,500 units.

5,175 units.