Category: Managerial Accounting

“Monthly cost and revenue amounts for a textbook are as follows: Fixed Costs Variable Costs Copy editing $3,000 Printing and binding $1.60/copy Art work $1,000 Bookstore discounts $2.00/copy Typesetting $36,000 Salespersons’ commissions $ .25/copy Author’s royalties $1.00/copy Each book sells for $10 per copy. 78. The contribution margin ratio for the textbook is: a. 41.5% b. 54.0% c. 71.5% d. 51.5%”

Managerial Accounting

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“Pardoe, Inc., manufactures a product called Product A. The company uses a standard cost system and has established the following standards for one unit of Product A: Standard Standard Price Standard Quantity or Rate Cost Direct materials 1.5 pounds $3 per pound $4.50 Direct labor 0.6 hours $6 per hour 3.60 Variable overhead 0.6 hours $1.25 per hour .75 $8.85 ÍÍÍÍÍ During March 19×3, the following activity was recorded by the company relative to the production of Product A: I. The company produced 3,000 units during the month. II. A total of 8,000 pounds of material were purchased at a cost of $23,000. III. There was no beginning inventory of materials on hand to start the month; at the end of the month, 2,000 pounds of material remained in the warehouse unused. IV. The company employs 10 people to work on the production of Product A. During March, each worked at an average of 160 hours at a rate of $6.50 per hour. In the past, the 10 persons employed in the production of Product A consisted of four senior workers and six assistants. During March, the company experimented with five senior workers and five assistants. V. Variable overhead is assigned to Product A on the basis of direct labor-hours. Variable overhead costs during March totaled $1,800.94. The material price variance for July was: a. $1,000 unfavorable. b. $1,000 favorable. c. $12,000 favorable. d. $12,000 unfavorable.”,”2Material price variance:Actual Quantity Purchased at actual price – Actual quantity at Standard price= $23,0000 – (8,000 x 3)= $1

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.“Pardoe, Inc., manufactures a product[…]

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“Pardoe, Inc., manufactures a product called Product A. The company uses a standard cost system and has established the following standards for one unit of Product A: Standard Standard Price Standard Quantity or Rate Cost Direct materials 1.5 pounds $3 per pound $4.50 Direct labor 0.6 hours $6 per hour 3.60 Variable overhead 0.6 hours $1.25 per hour .75 $8.85 ÍÍÍÍÍ During March 19×3, the following activity was recorded by the company relative to the production of Product A: I. The company produced 3,000 units during the month. II. A total of 8,000 pounds of material were purchased at a cost of $23,000. III. There was no beginning inventory of materials on hand to start the month; at the end of the month, 2,000 pounds of material remained in the warehouse unused. IV. The company employs 10 people to work on the production of Product A. During March, each worked at an average of 160 hours at a rate of $6.50 per hour. In the past, the 10 persons employed in the production of Product A consisted of four senior workers and six assistants. During March, the company experimented with five senior workers and five assistants. V. Variable overhead is assigned to Product A on the basis of direct labor-hours. Variable overhead costs during March totaled $1,800.95. The materials quantity variance for July was: a. $10,500 unfavorable. b. $6,000 favorable. c. $4,500 unfavorable. d. $6,750 unfavorable.”,”3Material Quantity Variance:Actual Quantity Used at Standard – Standard Quantity Allowed at Standard Rate 6000 x 3 – (3000 x 1.5) x 3 18,000 – 13,500 = $4,500 UActual Quantity at Standard – Standard Quantity allowed at Standard Rate18,000 – 13,500 = $4,500 UActual Quantity at Standard – Standard Quantity allowed at Standard Rate18,000 – 13,500 = $4

Managerial Accounting

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“Douglas Corporation produces and sells two models of vacuum cleaners, Standard and Deluxe. The company records show the following monthly data relating to these two products: Standard Deluxe Selling price per unit $140 $155 Variable production costs per unit 110 116 Variable selling expense per unit 15 12 Expected monthly sales in units 600 1,200 Total monthly fixed cost $15,000 80. If the expected monthly sales in units were divided equally between the two models (900 Standard and 900 Deluxe), the break-even level of sales would be: a. the same as with the expected sales mix. b. higher than with the expected sales mix. c. lower than with the expected sales mix. d. cannot be determined with the available data.”,”2The break-even point in Sales $: CM = Sales prices – VCCM from Standard 140 – 125 = 15 /unitCM from Deluxe 155 – 128 = 27 /unitThen if the sales mix would increase the standard

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.“Douglas Corporation produces and sells[…]

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“Pardoe, Inc., manufactures a product called Product A. The company uses a standard cost system and has established the following standards for one unit of Product A: Standard Standard Price Standard Quantity or Rate Cost Direct materials 1.5 pounds $3 per pound $4.50 Direct labor 0.6 hours $6 per hour 3.60 Variable overhead 0.6 hours $1.25 per hour .75 $8.85 ÍÍÍÍÍ During March 19×3, the following activity was recorded by the company relative to the production of Product A: I. The company produced 3,000 units during the month. II. A total of 8,000 pounds of material were purchased at a cost of $23,000. III. There was no beginning inventory of materials on hand to start the month; at the end of the month, 2,000 pounds of material remained in the warehouse unused. IV. The company employs 10 people to work on the production of Product A. During March, each worked at an average of 160 hours at a rate of $6.50 per hour. In the past, the 10 persons employed in the production of Product A consisted of four senior workers and six assistants. During March, the company experimented with five senior workers and five assistants. V. Variable overhead is assigned to Product A on the basis of direct labor-hours. Variable overhead costs during March totaled $1,800. 96. The labor rate variance for July was: a. $800 favorable. b. $4,640 unfavorable. c. $3,840 unfavorable. d. $800 unfavorable.”

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.“Pardoe, Inc., manufactures a product[…]

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“Madengrad Company manufactures a single electronic product called Precisionmix. This unit is a batch-density monitoring device attached to large industrial mixing machines used in flour, rubber, petroleum, and chemical manufacturing. Precisionmix sells for $900 per unit. The following variable costs are incurred to produce each Precisionmix device. Direct labor $180 Direct materials 240 Factory overhead 105 Total variable production costs 525 Marketing costs 75 Total variable costs $600 ÍÍÍÍ Madengrad’s annual fixed costs are $6,600,000. Except for an operating loss incurred in the year of incorporation, the firm has been profitable over the last five years. 81. If Madengrad Company achieves a sales and production volume of 8,000 units, the annual before-tax income (loss) will be a. $(4,200,000) b. $1,780,000 c. $(2,520,000) d. $(420,000) e. $2,400,000”,”1The annual (before tax) income (loss):Total Cost = Variable (8,000 x 600) = $4,800,000 Fixed 6,600,000Total 11,400,000Income = Sales – Total Cost = (8,000 x 900) – 11,400,000 = 7,200,000 – 11,400,000 = (4,200

Managerial Accounting

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“Columbia Company Income Statement-Variable Costing Method For the Month ended November 30, 19×4 Sales (40,000 units x $30) $1,200,000 Less Variable Costs: Variable cost of goods sold: Beginning Inventory (8,000 units) $144,000 Variable Cost of Goods Manufactured 630,000 Good Available for Sale $774,000 Ending Inventory (3,000 units) 54,000 Variable Cost of Goods Sold $720,000 Variable Selling Expense 160,000 Total Variable Costs 880,000 Contribution Margin $ 320,000 Fixed Costs: Manufacturing $140,000 Selling and Administrative 35,000 Total Fixed Costs 175,000 Net Income $ 145,000 ÍÍÍÍÍÍÍÍÍÍ During November 19×4, 35,000 units were manufactured. Production costs have remained constant on a per unit basis over the past several months. 82. The dollar value of the company’s inventory on November 30 under the absorption costing method would be: a. $54,000 b. $66,000 c. $78,000 d. $81,000”,”2The dollar value of the company’s inventory on November 30, under the absorption costing method:Fixed manufacturing costs per unit = 140,000 / 35,000=$4Absorption Cost = VC + Absorption = 54,000 + 3000 x $4 =$66

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.“Columbia Company Income Statement-Variable Costing[…]

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