Tracie Corporation manufactures and sells women's skirts. Each skirt (unit) requires 2.2 yards of cloth. Selected data from Tracie's master budget for next quarter are shown below:

	July			August		September
Budgeted sales (in units)	8,500			10,500		12,500
Budgeted production (in units)	9,500			12,000		14,500

Each unit requires 0.8 hours of direct labor, and the average hourly cost of Tracie's direct labor is $18. What is the cost of Tracie Corporation's direct labor in September?

Multiple Choice

$208,800

$225,000

$261,000

$180,000

2.

Frolic Corporation has budgeted sales and production over the next quarter as follows:

	July			August		September
Sales in units	43,500			55,500		?
Production in units	44,350			55,800		60,150

The company has 4,700 units of product on hand at July 1. 10% of the next month's sales in units should be on hand at the end of each month. October sales are expected to be 75,000 units. Budgeted sales for September would be (in units):

Garrison 16e Rechecks 2017-09-30, 2017-10-31

Multiple Choice

67,650

58,500

67,500

65,700

3.

The Southern Corporation manufactures a single product and has the following cost structure:

Variable costs per unit:
Production	$	35
Selling and administrative	$	14
Fixed costs per year:
Production	$	175,560
Selling and administrative	$	140,450

Last year, 7,980 units were produced and 7,680 units were sold. There was no beginning inventory.

The carrying value on the balance sheet of the ending inventory of finished goods under variable costing would be:

Multiple Choice

the same as absorption costing.

$7,680 greater than under absorption costing.

$7,680 less than under absorption costing.

$6,600 less than under absorption costing.

4.

The following are budgeted data:

	January			February		March
Sales in units	15,200			20,400		18,200
Production in units	18,200			19,200		17,100

One pound of material is required for each finished unit. The inventory of materials at the end of each month should equal 30% of the following month's production needs. Purchases of raw materials for February would be budgeted to be:

Garrison 16e Rechecks 2017-10-03

Multiple Choice

18,630 pounds

19,670 pounds

19,830 pounds

18,570 pounds

5.

Foster Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead costs and its activity based costing system:

Overhead costs:

Wages and salaries	$	175,000
Other expenses		137,000
Total	$	312,000

Distribution of resource consumption:

	Activity Cost Pools
	Making Bouquets	Delivery		Other	Total
Wages and salaries	50%	35%		15%	100%
Other expenses	20%	70%		10%	100%

The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs.

The amount of activity for the year is as follows:

Activity Cost Pool	Activity
Making bouquets	82,660	bouquets
Delivery	16,100	deliveries

What would be the total overhead cost per delivery according to the activity based costing system? In other words, what would be the overall activity rate for the deliveries activity cost pool? (Round to the nearest whole cent.)

Multiple Choice

$9.33

$9.76

$8.05

$10.62

6.

The manufacturing overhead budget at Foshay Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 6,500 direct labor-hours will be required in May. The variable overhead rate is $8.90 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $122,200 per month, which includes depreciation of $24,920. All other fixed manufacturing overhead costs represent current cash flows. The company recomputes its predetermined overhead rate every month. The predetermined overhead rate for May should be:

Multiple Choice

$18.80

$8.90

$24.20

$27.70