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Exam 1: Managerial Accounting and Cost Concepts

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Question 61

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The following data pertains to activity and utility cost for two recent periods: Utility cost is a mixed cost with both fixed and variable components.Using the high-low method,the cost formula for utility cost is:

A) Y = $1.00 X
B) Y = $1.25 X
C) Y = $4,000 + $0.50 X
D) Y = $1,500 + $1.25 X

E) None of the above
F) All of the above

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Question 62

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Frank Company operates a cafeteria for its employees.The number of meals served each week over the last seven weeks,along with the total costs of operating the cafeteria are given below: Assume that the relevant range includes all of the activity levels mentioned in this problem. Assume that the cafeteria expects to serve 1,850 meals during Week 8.Using the high-low method,the expected total cost of the cafeteria would be:

A) $5,340
B) $5,180
C) $5,300
D) $4,375

E) None of the above
F) A) and C)

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Question 63

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Calip Corporation,a merchandising company,reported the following results for October: The gross margin for October is:

The following cost data pertain to the operations of Bouffard Department Stores,Inc. ,for the month of May. The Brentwood Store is just one of many stores owned and operated by the company.The Shoe Department is one of many departments at the Brentwood Store.The central warehouse serves all of the company's stores. What is the total amount of the costs listed above that are NOT direct costs of the Brentwood Store?

Inspection costs at one of Iuliano Corporation's factories are listed below: Management believes that inspection cost is a mixed cost that depends on units produced. Using the high-low method,the estimate of the fixed component of inspection cost per month is closest to:

The ________________________ is the amount remaining from sales revenue after all variable expenses have been deducted.

Haab Inc.is a merchandising company.Last month the company's cost of goods sold was $66,000.The company's beginning merchandise inventory was $17,000 and its ending merchandise inventory was $11,000.What was the total amount of the company's merchandise purchases for the month?

Given the cost formula Y = $18,000 + $6X,total cost at an activity level of 9,000 units would be:

A partial listing of costs incurred at Falkenberg Corporation during October appears below: Required: a.What is the total amount of product cost listed above? Show your work. b.What is the total amount of period cost listed above? Show your work.

In describing the cost equation,Y = a + bX,"a" is:

When the level of activity decreases,variable costs will:

Conversion cost equals product cost less direct labor cost.

In a contribution format income statement,the gross margin minus selling and administrative expenses equals net operating income.

Callis 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 $141.60 per unit. The best estimate of the total contribution margin when 5,300 units are sold is:

Contribution margin equals revenue minus all fixed costs.

Data concerning Nelson Company's activity for the first six months of the year appear below: Using the high-low method of analysis,the estimated variable electrical cost per machine hour is:

During the month of April,direct labor cost totaled $15,000 and direct labor cost was 30% of prime cost.If total manufacturing costs during April were $79,000,the manufacturing overhead was:

Discretionary fixed costs:

Depreciation on manufacturing equipment is a product cost.

Which of the following would most likely be included as part of manufacturing overhead in the production of a wooden table?