Question 1

Anderwald Corporation has provided the following production and average cost data for two levels of monthly production volume. The company produces a single product.  The best estimate of the total monthly fixed manufacturing cost is:
A)$360,800
B)$136,800
C)$196,800
D)$176,800

Accepted Answer

The answer of Anderwald Corporation has provided the following production...

Question 2

A manufacturing company prepays its insurance coverage for a three-year period. The premium for the three years is $2,700 and is paid at the beginning of the first year. Eighty percent of the premium applies to manufacturing operations and 20% applies to selling and administrative activities. What amounts should be considered product and period costs respectively for the first year of coverage? 
A)Option A
B)Option B
C)Option C
D)Option D

Accepted Answer

The answer of A manufacturing company prepays its insurance coverage...

Question 3

Bakker Corporation has provided the following production and average cost data for two levels of monthly production volume. The company produces a single product.  The best estimate of the total variable manufacturing cost per unit is:
A)$89.70
B)$131.80
C)$19.50
D)$112.30

Accepted Answer

The answer of Bakker Corporation has provided the following production...

Question 4

At an activity level of 4,400 units in a month, Goldbach Corporation's total variable maintenance and repair cost is $313,632 and its total fixed maintenance and repair cost is $93,104. What would be the total maintenance and repair cost, both fixed and variable, at an activity level of 4,600 units in a month? Assume that this level of activity is within the relevant range.
A)$420,992
B)$425,224
C)$415,980
D)$406,736

Accepted Answer

Variable cost per unit = $313,632 F1F1F1S1F1F1F10 4,400 units = $71.28 unit
Total cost = Total fixed cost + Total variable cost
= $93,104 + $71.28 per unit F1F1F1S1F1F1F10 4,600 units
= $93,104 + $327,888
= $420,992

Question 5

Jumpst Corporation uses the cost formula Y = $3,600 + $0.30X for the maintenance cost in Department B, where X is machine-hours. The August budget is based on 20,000 hours of planned machine time. Maintenance cost expected to be incurred during August is:
A)$3,600
B)$6,000
C)$6,300
D)$9,600

Accepted Answer

Y = $3,600 + $0.30 per unit F1F1F1S1F1F1F10 X
= $3,600 + $0.30 per unit F1F1F1S1F1F1F10 20,000 hours
= $3,600 + $6,000
= $9,600

Question 6

Average maintenance costs are $1.50 per machine-hour at an activity level of 8,000 machine-hours and $1.20 per machine-hour at an activity level of 13,000 machine-hours. Assuming that this activity is within the relevant range, total expected maintenance cost for a budgeted activity level of 10,000 machine-hours would be closest to:
A)$16,128
B)$15,000
C)$13,440
D)$11,433

Accepted Answer

Average maintenance cost = Total maintenance cost F1F1F1S1F1F1F10 Total activity
 11eaa48f_7c06_2f61_9e4a_8d9f8b46cbdc_TB2485_00 Variable cost = Change in cost F1F1F1S1F1F1F10 Change in activity
= ($15,600 - $12,000)F1F1F1S1F1F1F10 (13,000 machine-hours - 8,000 machine hours)
= $3,600 F1F1F1S1F1F1F10 5,000 machine-hours
= $0.72 per machine-hour
Total fixed cost = Total cost - Total variable cost
= $15,600 - ($0.72 per machine-hour F1F1F1S1F1F1F10 13,000 machine-hours)
= $15,600 - $9,360
= $6,240
Total cost = Total fixed cost + Total variable cost
= $6,240 + $0.72 per machine-hour F1F1F1S1F1F1F10 10,000 machine-hours
= $6,240 + $7,200
= $13,440

Question 7

Blore Corporation reports that at an activity level of 7,300 units, its total variable cost is $511,803 and its total fixed cost is $76,650. What would be the total cost, both fixed and variable, at an activity level of 7,500 units? Assume that this level of activity is within the relevant range.
A)$604,575
B)$602,475
C)$596,514
D)$588,453

Accepted Answer

Variable cost per unit = $511,803 F1F1F1S1F1F1F10 7,300 units = $70.11 unit
Total cost = Total fixed cost + Total variable cost
= $76,650 + $70.11 per unit F1F1F1S1F1F1F10 7,500 units
= $76,650 + $525,825
= $602,475

Question 8

At a volume of 10,000 units, Company P incurs $30,000 in factory overhead costs, including $10,000 in fixed costs. Assuming that this activity is within the relevant range, if volume increases to 12,000 units, Company P would expect to incur total factory overhead costs of:
A)$36,000
B)$34,000
C)$30,000
D)$32,000

Accepted Answer

Total cost = Fixed cost + Variable cost
$30,000 = $10,000 + Variable costs
Variable cost = $30,000 - $10,000
Variable cost = $20,000
Variable costs per unit = $20,000 F1F1F1S1F1F1F10 10,000 units = $2 per unit
Total cost = Total fixed cost + Total variable cost
= $10,000 + $2 per unit F1F1F1S1F1F1F10 12,000 units
= $10,000 + $24,000
= $34,000

Question 9

Haras Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $141.30 per unit.  The best estimate of the total variable cost per unit is:
A)$123.40
B)$79.60
C)$57.90
D)$130.70

Accepted Answer

The answer of Haras Corporation is a wholesaler that sells...

Question 10

Edeen Corporation has provided the following production and total cost data for two levels of monthly production volume. The company produces a single product.  The best estimate of the total variable manufacturing cost per unit is:
A)$62.20
B)$96.50
C)$109.30
D)$12.80

Accepted Answer

The answer of Edeen Corporation has provided the following production...

Question 11

Given the cost formula, Y = $9,000 + $2.50X, total cost for an activity level of 3,000 units would be:
A)$9,750
B)$12,000
C)$16,500
D)$7,500

Accepted Answer

To find the total cost for an activity level of 3,000 units, we substitute X = 3,000 into the cost formula:
Y = $9,000 + $2.50X
Y = $9,000 + $2.50(3,000)
Y = $9,000 + $7,500
Y = $16,500
Therefore, the total cost for an activity level of 3,000 units would be $16,500.

Question 12

Gambarini Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $197.80 per unit.  The best estimate of the total monthly fixed cost is:
A)$541,800
B)$1,192,100
C)$1,099,200
D)$1,145,650

Accepted Answer

The answer of Gambarini Corporation is a wholesaler that sells...

Question 13

Carbaugh Corporation has provided the following production and average cost data for two levels of monthly production volume. The company produces a single product.  The best estimate of the total cost to manufacture 3,300 units is closest to:
A)$637,560
B)$612,975
C)$588,390
D)$619,680

Accepted Answer

The answer of Carbaugh Corporation has provided the following production...

Question 14

The following data pertains to activity and costs for two months:  Assuming that these activity levels are within the relevant range, the mixed cost for July was:
A)$10,000
B)$35,000
C)$15,000
D)$40,000

Accepted Answer

The answer of The following data pertains to activity and...

Question 15

Iadanza Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $195.70 per unit.  The best estimate of the total contribution margin when 6,300 units are sold is:
A)$752,220
B)$638,190
C)$100,170
D)$177,030

Accepted Answer

The answer of Iadanza Corporation is a wholesaler that sells...

Question 16

The following data pertains to activity and the cost of cleaning and maintenance for two recent months:  The best estimate of the total month 1 variable cost for cleaning and maintenance is:
A)$300
B)$500
C)$800
D)$100

Accepted Answer

The best estimate of the total month 1 variable cost for cleaning and maintenance can be calculated by taking the difference between the total cost in month 1 and the fixed cost for both months. From the data given, the fixed cost for both months is $500. Therefore, the variable cost for month 1 can be calculated as:
Total cost for month 1 - Fixed cost = $1,300 - $500 = $800. Therefore, the best estimate for the total month 1 variable cost is $800, which is option C.

Question 17

Given the cost formula Y = $15,000 + $5X, total cost at an activity level of 8,000 units would be:
A)$23,000
B)$15,000
C)$55,000
D)$40,000

Accepted Answer

The cost formula is Y = $15,000 + $5X, which means that for every unit of activity (X), the cost (Y) increases by $5. To find the total cost at an activity level of 8,000 units, we need to substitute X = 8,000 into the formula:

Y = $15,000 + $5(8,000)
Y = $15,000 + $40,000
Y = $55,000

Therefore, the total cost at an activity level of 8,000 units would be $55,000.

Question 18

Anaconda Mining Company shipped 9,000 tons of copper concentrate for $450,000 in March and 11,000 tons for $549,000 in April. Shipping costs for 12,000 tons to be shipped in May would be expected to be:
A)$548,780
B)$549,020
C)$594,000
D)$598,500

Accepted Answer

Variable shipping cost per ton = Change in cost F1F1F1S1F1F1F10 Change in activity
= ($549,000 - $450,000)F1F1F1S1F1F1F10 (11,000 tons - 9,000 tons)
= $99,000 F1F1F1S1F1F1F10 2,000 tons
= $49.50 per ton
Fixed cost element of shipping cost = Total cost - Total variable cost
= $549,000 - ($49.50 per ton F1F1F1S1F1F1F10 11,000 tons)
= $549,000 - $544,500
= $4,500
Total shipping cost = $4,500 + $49.50 per ton F1F1F1S1F1F1F10 12,000 tons = $4,500 + $594,000 = $598,500

Question 19

At an activity level of 9,200 machine-hours in a month, Nooner Corporation's total variable production engineering cost is $761,300 and its total fixed production engineering cost is $154,008. What would be the total production engineering cost per unit, both fixed and variable, at an activity level of 9,300 machine-hours in a month? Assume that this level of activity is within the relevant range.
A)$98.42
B)$99.49
C)$99.31
D)$98.96

Accepted Answer

Variable cost per unit = $761,300 F1F1F1S1F1F1F10 9,200 units = $82.75 per unit
Fixed cost per unit at 9,300 units = $154,008 F1F1F1S1F1F1F10 9,300 units = $16.56 per unit
Total cost = Variable cost + Fixed cost
= $82.75 per unit + $16.56 per unit
= $99.31 per unit

Question 20

Dabney Corporation has provided the following production and total cost data for two levels of monthly production volume. The company produces a single product.  The best estimate of the total monthly fixed manufacturing cost is:
A)$778,400
B)$1,457,400
C)$1,505,900
D)$1,554,400

Accepted Answer

The answer of Dabney Corporation has provided the following production...

Quiz 1: Managerial Accounting and Cost Concepts

Anderwald Corporation has provided the following production and average cost data for two levels of monthly production volume. The company produces a single product. The best estimate of the total monthly fixed manufacturing cost is:

Bakker Corporation has provided the following production and average cost data for two levels of monthly production volume. The company produces a single product. The best estimate of the total variable manufacturing cost per unit is:

Jumpst Corporation uses the cost formula Y = $3,600 + $0.30X for the maintenance cost in Department B, where X is machine-hours. The August budget is based on 20,000 hours of planned machine time. Maintenance cost expected to be incurred during August is:

Blore Corporation reports that at an activity level of 7,300 units, its total variable cost is $511,803 and its total fixed cost is $76,650. What would be the total cost, both fixed and variable, at an activity level of 7,500 units? Assume that this level of activity is within the relevant range.

At a volume of 10,000 units, Company P incurs $30,000 in factory overhead costs, including $10,000 in fixed costs. Assuming that this activity is within the relevant range, if volume increases to 12,000 units, Company P would expect to incur total factory overhead costs of:

Haras Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $141.30 per unit. The best estimate of the total variable cost per unit is:

Edeen Corporation has provided the following production and total cost data for two levels of monthly production volume. The company produces a single product. The best estimate of the total variable manufacturing cost per unit is:

Given the cost formula, Y = $9,000 + $2.50X, total cost for an activity level of 3,000 units would be:

Gambarini Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $197.80 per unit. The best estimate of the total monthly fixed cost is:

Carbaugh Corporation has provided the following production and average cost data for two levels of monthly production volume. The company produces a single product. The best estimate of the total cost to manufacture 3,300 units is closest to:

The following data pertains to activity and costs for two months: Assuming that these activity levels are within the relevant range, the mixed cost for July was:

Iadanza Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $195.70 per unit. The best estimate of the total contribution margin when 6,300 units are sold is:

The following data pertains to activity and the cost of cleaning and maintenance for two recent months: The best estimate of the total month 1 variable cost for cleaning and maintenance is:

Given the cost formula Y = $15,000 + $5X, total cost at an activity level of 8,000 units would be:

Anaconda Mining Company shipped 9,000 tons of copper concentrate for $450,000 in March and 11,000 tons for $549,000 in April. Shipping costs for 12,000 tons to be shipped in May would be expected to be:

Dabney Corporation has provided the following production and total cost data for two levels of monthly production volume. The company produces a single product. The best estimate of the total monthly fixed manufacturing cost is: