53.
Crafter Lumber Supply noticed a recent decline in the amount of purchases from a key
customer. Worried that other customers might also reduce their purchases, Crafter’s
management decided to evaluate the cost of its delivery service. Which of the following
cost drivers is more appropriate for general administrative costs of the Delivery
Department?
54.
The unused resource capacity is the difference between the resources supplied and the
resources:
10–43
55.
The amount of resources used in an activity-based costing (ABC) system for a specific
activity is computed by multiplying the:
56.
South Beach Industries reports the following information about resources. At the
beginning of the year, South Beach estimated it would spend $180,000 for materials,
$42,000 for purchasing, $35,000 for setups, and $36,000 for repairs.
Cost Driver
Rate
Volume
Resources used
Materials
$10/lb
18,350 lbs
Purchasing
$250/purchase
order
160 purchase
orders
Setups
$450/setup
80 setups
Repairs
36
700 jobs
Resources
supplied
Materials
$192,700
Purchasing
44,300
Setups
$37,500
Repairs
30,000
Compute unused resource capacity for materials for South Beach.
10–45
57.
South Beach Industries reports the following information about resources. At the
beginning of the year, South Beach estimated it would spend $180,000 for materials,
$42,000 for purchasing, $35,000 for setups, and $36,000 for repairs.
Cost Driver
Rate
Volume
Resources used
Materials
$10/lb
18,350 lbs
Purchasing
$250/purchase
order
160 purchase
orders
Setups
$450/setup
80 setups
Repairs
36
700 jobs
Resources
supplied
Materials
$192,700
Purchasing
44,300
Setups
$37,500
Repairs
30,000
Compute unused resource capacity for purchasing for South Beach.
58.
South Beach Industries reports the following information about resources. At the
beginning of the year, South Beach estimated it would spend $180,000 for materials,
$42,000 for purchasing, $35,000 for setups, and $36,000 for repairs.
Cost Driver
Rate
Volume
Resources used
Materials
$10/lb
18,350 lbs
Purchasing
$250/purchase
order
160 purchase
orders
Setups
$450/setup
80 setups
Repairs
36
700 jobs
Resources
supplied
Materials
$192,700
Purchasing
44,300
Setups
$37,500
Repairs
30,000
Compute unused resource capacity for setups for South Beach.
59.
South Beach Industries reports the following information about resources. At the
beginning of the year, South Beach estimated it would spend $180,000 for materials,
$42,000 for purchasing, $35,000 for setups, and $36,000 for repairs.
Cost Driver
Rate
Volume
Resources used
Materials
$10/lb
18,350 lbs
Purchasing
$250/purchase
order
160 purchase
orders
Setups
$450/setup
80 setups
Repairs
36
700 jobs
Resources
supplied
Materials
$192,700
Purchasing
44,300
Setups
$37,500
Repairs
30,000
Compute unused resource capacity for repairs for South Beach.
60.
Macon Publishing reports the following information about resources. At the beginning of
the year, Macon estimated it would spend $42,000 for setups and $21,000 for clerical.
Cost Driver
Rate
Volume
Resources used
Setups
$250
175 runs
Clerical
30
500 pages typed
Resources supplied
Setups
$45,000
Clerical
20,000
61.
Macon Publishing reports the following information about resources. At the beginning of
the year, Macon estimated it would spend $42,000 for setups and $21,000 for clerical.
Cost Driver
Rate
Volume
Resources used
Setups
$250
175 runs
Clerical
30
500 pages typed
Resources supplied
Setups
$45,000
Clerical
20,000
62.
Denim Products reports the following information about resources. At the beginning of the
year, Denim estimated it would spend $84,000 for setups and $41,000 for quality testing.
Cost Driver
Rate
Volume
Resources used
Setups
$250/run
350 runs
Quality testing
$40/test
900 tests
Resources supplied
Setups
$90,000
Quality testing
40,000
Compute unused resource capacity for setups for Denim Products.
63.
Denim Products reports the following information about resources. At the beginning of the
year, Denim estimated it would spend $84,000 for setups and $41,000 for quality testing.
Cost Driver
Rate
Volume
Resources used
Setups
$250/run
350 runs
Quality testing
$40/test
900 tests
Resources supplied
Setups
$90,000
Quality testing
40,000
Compute unused resource capacity for quality testing for Denim Products.
64.
Scallon Products reports the following information about resources. At the beginning of
the year, Scallon estimated it would spend $8,000 for energy and $12,000 for repairs.
Cost Driver
Rate
Volume
Resources used
Energy
$0.80/MH
11,350 MH
Repairs
$24/job
600 jobs
Resources supplied
Energy
$10,500
Repairs
18,000
65.
Scallon Products reports the following information about resources. At the beginning of
the year, Scallon estimated it would spend $8,000 for energy and $12,000 for repairs.
Cost Driver
Rate
Volume
Resources used
Energy
$0.80/MH
11,350 MH
Repairs
$24/job
600 jobs
Resources supplied
Energy
$10,500
Repairs
18,000
Compute unused resource capacity for repairs for Scallon Products.
66.
The amount of production possible under normal working conditions, including planned
downtime and scheduled vacations, is called:
67.
rate.
68.
69.
70.
71.
Marine Enterprises has developed the following unit costs for the production of one of its
products, based on a normal activity of 10,000 units per month:
Direct materials
2.0 pounds @ $12 = $24.00
Direct labor
1.5 hours @ $15 = $22.50
Variable overhead
120% of direct labor cost
Fixed overhead
140% of direct labor cost
What is the total amount of direct labor budgeted for a month in which production is
expected to be 11,000 units?
72.
Marine Enterprises has developed the following unit costs for the production of one of its
products, based on a normal activity of 10,000 units per month:
Direct materials
2.0 pounds @ $12 = $24.00
Direct labor
1.5 hours @ $15 = $22.50
Variable overhead
120% of direct labor cost
Fixed overhead
140% of direct labor cost
What is the total amount of overhead included in the overhead budget for a month in
which production is expected to be 11,000 units?
73.
The degree to which a good or service meets specifications is called:
74.
75.
Which of the following is not an example of a prevention cost?