Question7

Aday Restaurant Supply produced 300,000 pots and pans last year, and incurred the following costs:

TOTAL COST

Direct Materials

$80,000

Labor Cots

$120,000

Indirect Materials

$40,000

Administrative Costs

$40,000

Other Fixed Costs

$30,000

Total Costs

$310,000

The management has decided the following:

1.All of Direct Materials will be considered Variable Costs

2.80% of Labor Costs will be classified as VC and 20% as FC.

3.40% of Indirect Materials will be classified as FC and 60% as VC.

4.All of Administrative Costs and Other Fixed Costs will be considered as FC.

Using the above information, calculate:

TOTAL VARIABLE COSTS

Select one:

a.$200,000

b.$310,000

c.$110,000

d.$0.67

Question8

Aday Restaurant Supply produced 300,000 pots and pans last year, and incurred the following costs:

TOTAL COST

Direct Materials

$80,000

Labor Cots

$120,000

Indirect Materials

$40,000

Administrative Costs

$40,000

Other Fixed Costs

$30,000

Total Costs

$310,000

The management has decided the following:

1.All of Direct Materials will be considered Variable Costs

2.80% of Labor Costs will be classified as VC and 20% as FC.

3.40% of Indirect Materials will be classified as FC and 60% as VC.

4.All of Administrative Costs and Other Fixed Costs will be considered as FC.

Using the above information, calculate:

TOTAL FIXED COSTS

Select one:

a.$110,000

b.$310,000

c.$200,000

d.$0.37