Question 1 - The following information was summarized from the records of the Muentes Company for the first quarter of the year:

Sales $700,000 / Fixed administration expenses $110,000 / Fixed cost of goods sold $100,000

Fixed selling expense $50,000 / Variable administration expenses $30,000 / Variable cost of goods sold $220,000

Variable selling expense $17,000

The company's contribution margin for the quarter was:

(A) $280,000

(B) $380,000

(C) $420,000

(D) $600,000

Question 2 - All of the following would be classified as product costs except:

(A) the cost of air-conditioning the factory foreman's office.

(B) depreciation on the machinery in the factory.

(C) the cost of shipping units of product to one of the company's customers

(D) All of the above would be classified as product costs.

Question 3 - Given the cost formula Y = $30,000 + $5X, total cost at an activity level of 16,000 units would be:

(A) $30,000

(B) $46,000

(C) $80,000

(D) $110,000

Question 4 - All of the following would be classified as manufacturing overhead except the:

(A) wages of supervisor of the machining shop.

(B) depreciation of the equipment in the machining shop.

(C ) property taxes relating to the building that houses the machining shop.

(D) All of the above would be classified as manufacturing overhead.

Question 5 - An opportunity cost is:

(A) the difference between the total cost of one alternative and the total cost of another alternative.

(B) the benefit forgone when one alternative is selected rather than another.

(C) a cost that is saved by not adopting a given alternative.

(D) a cost that continues to be incurred even when there is no activity.

Question 6 - Within the relevant range:

(A) both total variable costs and total fixed costs will remain constant.

(B) both total variable costs and total fixed costs fluctuate.

(C) Fixed costs per unit will remain constant and variable costs per unit will fluctuate.

(D) Total fixed cost is not affected by changes in the activity level within the relevant range

Question 7 - Copy of The following information was summarized from the records of the Muentes Company for the first quarter of the year:

Sales $700,000 / Fixed administration expense $110,000 / Fixed cost of goods sold $100,000 /

Fixed Selling Expense $50,000 / Variable administration expenses $30,000 /

Variable cost of goods sold $220,000 / Variable selling expense $170,000

The company's gross margin for the quarter was:

(A) $280,000

(B) $380,000

(C) $420,000

(D) $440,000

Question 8 - Which one of the following costs would not be considered an indirect cost of serving a particular customer at a delicatessen?

(A) The salary of the manager. (B) The cost of the tables and chairs used to furnish the restaurant (C) The cost of the bread used to make the sub sandwich that is ordered

(D) The cost of lighting and heating the restaurant.

Question 9 - An analysis of a particular cost incurred in a factory revealed that the cost averages $0.40 per machine-hour at an activity level of 20,000 machine hours and increases to an average of $0.50 per machine hour at an activity level of 16,000 machine hours. Assuming that this activity is within the relevant range, what is the total expected cost if the activity level is 17,300 machine hours?

(A) $1,600 (B) $6,960 (C) $8,000 (D) $9,000