Exam 1: Managerial Accounting and Cost Concepts

What would be the average fixed maintenance cost per unit at an activity level of 9,300 machine-hours in a month? Assume that this level of activity is within the relevant range.

A step-variable cost is a cost that is obtained in large chunks and that increases or decreases only in response to fairly wide changes in activity.

A number of costs and measures of activity are listed below. Required: For each item above, indicate whether the cost is MAINLY fixed or variable with respect to the possible measure of activity listed next to it.

In the standard cost formula Y = a + bX, what does the "Y" represent?

Shelp Corporation has provided the following information: For financial reporting purposes, the total amount of period costs incurred to sell 9,000 units is closest to:

One full-time clerical worker is needed for every 750 accounts receivable.The total wages of the accounts receivable clerks is an example of a:

If the activity level increases, then one would expect the fixed cost per unit to increase as well.

Norred Corporation has provided the following information: If 8,000 units are produced, the total amount of indirect manufacturing cost incurred is closest to:

The prime cost for November was:

Dizzy gives out a free T-shirt to every 100th customer entering the park.The cost of this T-shirt would best be described as a:

For financial reporting purposes, the total amount of product costs incurred to make 4,000 units is closest to:

Property taxes on the building that will be purchased to house the manufacturing facility are:

Conversion cost is the sum of direct labor cost and manufacturing overhead cost.

The gross margin for October is:

Weingartner Corporation, a merchandising company, reported sales of 4,800 units for July at a selling price of $269 per unit.The cost of goods sold (all variable)was $114 per unit and the variable selling expense was $6 per unit.The total fixed selling expense was $38,100.The variable administrative expense was $14 per unit and the total fixed administrative expense was $59,900. Required: a.Prepare a contribution format income statement for July. b.Prepare a traditional format income statement for July.

A merchandising company typically will have a high proportion of which type of cost in its cost structure?

If 5,000 units are sold, the variable cost per unit sold is closest to:

The total of the manufacturing overhead costs listed above for March is:

If 4,000 units are sold, the total variable cost is closest to:

If 4,000 units are sold, the total variable cost is closest to: