1) The net operating income for March was:
A) $130,000
B) $134,000
C) $43,000
D) $47,000
2) At a break-even point of 800 units sold, White Corporation’s variable expenses are
$8,000 and its fixed expenses are $4,000. What will the Corporation’s net operating
income be at a volume of 801 units?
A.$15
B.$10
C.$5
D.$20
3) The Maxwell Corporation has a standard costing system in which variable
manufacturing overhead is assigned to production on the basis of standard
machine-hours. The following data are available for July:
Actual variable manufacturing overhead cost incurred: $22,620
Actual machine-hours worked: 1,600 hours
Variable overhead rate variance: $3,420 Unfavorable
Total variable overhead spending variance: $4,620 Unfavorable
The variable overhead efficiency variance for July is:
A.$8,040 Unfavorable
B.$8,040 Favorable
C.$1,200 Unfavorable
D.$1,200 Favorable
4) Escau Corporation is a wholesale distributor that uses activity-based costing for all of
its overhead costs. The company has provided the following data concerning its annual
overhead costs and its activity based costing system:
The “Other” activity cost pool consists of the costs of idle capacity and
organization-sustaining costs.
The activity measures for the activity cost pools for the year are as follows:
What would be the total overhead cost per order according to the activity based costing
system? In other words, what would be the overall activity rate for the filling orders
activity cost pool? (Round to the nearest whole cent.)
A.$56.00
B.$48.00
C.$49.67
D.$52.00
5) The most recent balance sheet and income statement of Dallavalle Corporation
appear below:
Cash dividends were $12. The company did not retire or sell any property, plant, and
equipment during the year. The net cash provided by (used in) operating activities for
the year was:
A.$77
B.$68
C.$40
D.$14
6) The total of the product costs listed above for December is:
A) $340,000
B) $82,000
C) $647,000
D) $307,000
7) The net cash provided by (used in) investing activities for the year was:
A.$26
B.$15
C.$(26)
D.$(15)
8) Davis 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) $130,000
B) $177,600
C) $34,800
D) $225,200
9) Wahler Corporation manufactures and sells one product. In the company’s first year
of operations, the variable cost consisted solely of direct materials of $85 per unit. The
annual fixed costs were $640,000 of direct labor cost, $2,208,000 of fixed
manufacturing overhead expense, and $1,140,000 of fixed selling and administrative
expense. The company does not have any variable manufacturing overhead costs or
variable selling and administrative costs. During its first year of operations, the
company produced 32,000 units and sold 30,000 units. The company’s only product is
sold for $249 per unit.
The net operating income for the year under super-variable costing is:
A.$1,110,000
B.$932,000
C.$972,000
D.$762,000
10) What is the maximum contribution margin the company can earn per month?
A.$28,908
B.$36,476
C.$25,124
D.$26,999
11) The free cash flow for the year was:
A.$123,000
B.$87,000
C.$142,000
D.$269,000
12) Benoist Corporation has an activity-based costing system with three activity cost
pools-Machining, Setting Up, and Other. The company’s overhead costs have already
been allocated to the cost pools and total $17,200 for the Machining cost pool, $7,700
for the Setting Up cost pool, and $52,100 for the Other cost pool.
Costs in the Machining cost pool are assigned to products based on machine-hours
(MHs) and costs in the Setting Up cost pool are assigned to products based on the
number of batches. Costs in the Other cost pool are not assigned to products. Data
concerning the two products and the company’s costs appear below:
Required:
a. Calculate activity rates for each activity cost pool using activity-based costing.
b. Determine the amount of overhead cost that would be assigned to each product using
activity-based costing.
c. Determine the product margins for each product using activity-based costing.