Using the following information, determine the activity rate for purchase order activity. Activity Setups Purchase orders Quality inspections Budgeted Activity Cost Pool $60,000 100,000 0,000 Estimated Activity Base 1,000 10,000 2,000 a. $100 Ob. $10 d. $2 Under target costing, costs can be reduced in a variety of ways including all of the following except a. eliminating waste. b. changing the sales level. c. simplifying the design. d. None of these choices are correct. Using the following information, determine the activity rate for the quality inspections activity. Activity Setups Purchase orders Quality inspections Budgeted Activity Cost Pool $60,000 100,000 40,000 Estimated Activity Base 1,000 10,000 2,000 a. $100 b. $10 c. $6 Od. $20 Under the product cost concept, the product cost per unit is calculated as O a. (Total Product Costs/Desired Profit) + Total Selling and Administrative Expenses. b. Estimated Units Produced and Sold/Total Product Cost. c. Desired Profit/Total Product Cost. d. Total Product Costs/Estimated Units Produced and Sold. Bright Times Company has a table lamp segment that has been losing money for the last year and is considering closing that segment. This year's revenue was $78,000, with variable costs of $50,000 and fixed costs of $40,000. Determine the differential income or loss from the table lamp segment and whether the segment should be discontinued. a. differential loss, $90,000; segment should be discontinued b. differential income, $78,000; segment should be continued oc. differential loss, $12,000; segment should be discontinued d. differential income,$28,000; segment should be continued Rumba Dance Hall is considering offering a wedding reception package that includes the ballroom rental, decorations, a wedding cake, Determine if the new package isstare tiny the company is renting the baliroom with no extras at $4,500. The extras will cost $800. a. It decreases profits by $800 O b. It increases profits by $700 c. It increases profits by $800. d. The profitability cannot be determined from the information given. Muy costs. The total variable cost is $17. The desired profit is $9 per unit. Determine the markup percentage on product cost. Bueno Bakery sells its special chocolate cake for $35. The total cost to produce the cake is $26. Of this amount, $4 per unit is selling a, 25% , b. 59% c. 40% d, 65% Differential analysis is used a. to measure managerial efficiency in the use of investments in assets, computed as income from operations divided by invested C b. for comparing one company with another or for comparing a company with industry averages. Oc. to determine the effect of alternative courses of action on revenues and costs. assets. d. as a measure of the relative mik of a business's variable costs and fixed costs, computed as contribution margin divided by operating income. The activity rate is calculated as a. Estimated Activity Cost + Estimated Activity-Base Usage b. Estimated Activity Cost - Estimated Activity-Base Usage. c. Estimated Activity Cost/Estimated Activity-Base Usage. d. Estimated Activity Cost x Estimated Activity-Base Usage
