Question 31ptsSkip to question text.

Daniele Corporation uses an activity-based costing system with the following three activity cost pools:

Activity Cost Pool	Total Activity
Fabrication	50,000 machine-hours
Order processing	500 orders
Other	Not applicable

The Other activity cost pool is used to accumulate costs of idle capacity and organization-sustaining costs.

The company has provided the following data concerning its costs:

Wages and salaries	$280,000
Depreciation	200,000
Occupancy	140,000
Total	$620,000

The distribution of resource consumption across activity cost pools is given below:

Activity Cost Pools Order
Fabrication	Processing	Other	Total
Wages and Salaries	60%	30%	10%	100%
Depreciation	20%	35%	45%	100%
Occupancy	10%	50%	40%	100%

The activity rate for the Fabrication activity cost pool is closest to:

$1.24 per machine-hour

$3.72 per machine-hour

$4.44 per machine-hour

$7.44 per machine-hour

Flag this QuestionQuestion 41ptsSkip to question text. Graney Corporation uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs and its activity based costing system:

Cost
Wages and salaries	$240,000
Depreciation	200,000
Utilities	100,000
Total	$540,000

Activity Cost Pools
Assembly	Setting Up	Other	Total
Wages and salaries	40%	40%	20%	100%
Depreciation	20%	45%	35%	100%
Utilities	35%	40%	25%	100%

How much cost, in total, would be allocated in the first-stage allocation to the Other activity cost pool?

$108,000

$144,000

$135,000

$143,000

Flag this QuestionQuestion 51ptsSkip to question text.

Viren Corporation has provided the following data from its activity-based costing system:

Activity Cost Pool	Total Cost	Total Activity
Assembly	$387,000	25,000 machine-hours
Processing orders	$68,510	1,700 orders
Inspection	$129,117	1,930 inspection-hours

The company makes 240 units of product T91H a year, requiring a total of 550 machine-hours, 90 orders, and 40 inspection-hours per year. The product's direct materials cost is $16.98 per unit and its direct labor cost is $12.09 per unit.

According to the activity-based costing system, the average cost of product T91H is closest to:

$75.70 per unit

$29.07 per unit

$79.66 per unit

$90.81 per unit

Flag this Question

Flag this Question

Flag this Question

Flag this QuestionQuestion 111ptsSkip to question text.

Indiana Corporation produces a single product that it sells for $9 per unit. During the first year of operations, 100,000 units were produced and 90,000 units were sold. Manufacturing costs and selling and administrative expenses for the year were as follows:

Fixed Costs	Variable Costs
Raw materials	$1.75 per unit produced
Direct labor	$1.25 per unit produced
Factory overhead	100,000	$0.50 per unit produced
Selling and administrative	$70,000	$0.60 per unit sold

What was Indiana Corporation's net operating income for the year using variable costing?

$371,000

$271,000

$281,000

$181,000

Flag this QuestionQuestion 121ptsSkip to question text. Atlantic Company produces a single product. For the most recent year, the company's net operating income computed by the absorption costing method was $7,400, and its net operating income computed by the variable costing method was $10,100. The company's unit product cost was $17 under variable costing and $22 under absorption costing. If the ending inventory consisted of 1,460 units, the beginning inventory must have been:

920 units

1,460 units

2,000 units

12,700 units

Flag this QuestionQuestion 131ptsSkip to question text.

Harris Company produces a single product. Last year, Harris manufactured 17,000 units and sold 13,000 units. Production costs for the year were as follows:

Direct materials	$153,000
Direct labor	$110,500
Variable manufacturing overhead	$204,000
Fixed manufacturing overhead	$255,000

Sales were $780,000 for the year, variable selling and administrative expenses were $88,400, and fixed selling and administrative expenses were $170,000. There was no beginning inventory. Assume that direct labor is a variable cost.

The contribution margin per unit was:

$27.30

$32.50

$25.70

$17.50

Flag this QuestionQuestion 141ptsSkip to question text.

Hackney Company, which has only one product, has provided the following data concerning its most recent month of operations:

Selling Price	$110
Units in beginning inventory	0
Units produced	4,800
Units sold	4,700
Units in ending inventory	100
Variable costs per unit
Direct materials	$30
Direct labor	$52
Variable manufacturing overhead	$3
Variable selling and administrative	$7
Fixed costs:
Fixed manufacturing overhead	$72,000
Fixed selling and administrative	$9,400

The total contribution margin for the month under the variable costing approach is:

$117,500

$47,000

$84,600

$12,600

Flag this QuestionQuestion 151ptsSkip to question text.

During its first year of operations, Holt Manufacturing Company incurred the following costs to produce 200,000 units of its only product:

Direct materials	$144,000
Direct labor	$108,000
Variable manufacturing overhead	$216,000
Fixed manufacturing overhead	$432,000

Holt also incurred the following costs in the sale of 180,000 units of product during its first year:

Variable selling and administrative	$72,000
Fixed selling and administrative	$252,000

Assume that direct labor is a variable cost. If Holt's variable costing net operating income for this first year is $397,800, what would its absorption costing net operating income be for this first year?

$445,800

$441,000

$473,800

$354,600

Flag this QuestionQuestion 161ptsSkip to question text.

Dearman Company, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price	$158
Units in beginning inventory	0
Units produced	3,100
Units sold	2,800
Units in ending inventory	300
Variable costs per unit
Direct materials	$49
Direct labor	$57
Variable manufacturing overhead	$3
Variable selling and administrative	$11
Fixed costs
Fixed manufacturing overhead	$65,100
Fixed selling and administrative	$33,600

What is the total period cost for the month under the variable costing approach?

$65,100

$98,700

$129,500

$64,400