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89) Delisa Corporation has two divisions: Division L and Division Q. Data from the most recent
month appear below:
Total
Company
Division L
Division Q
Sales
$
517,000
$
156,000
$
361,000
Variable expenses
255,960
82,680
173,280
Contribution margin
261,040
73,320
187,720
Traceable fixed expenses
171,000
49,000
122,000
Segment margin
90,040
$
24,320
$
65,720
Common fixed expenses
87,890
Net operating income
$
2,150
The break-even in sales dollars for Division Q is closest to:
A) $352,635
B) $234,615
C) $403,635
D) $512,742
90) Fernstrom Corporation has two divisions: East and West. Data from the most recent month
appear below:
East
West
Sales
$
330,000
$
144,000
Variable expenses
$
132,000
$
76,320
Traceable fixed expenses
$
140,000
$
43,000
The company's common fixed expenses total $52,140. If the company operates at exactly the
break-even sales of the East Division and West Division, what would be the company's overall
net operating income?
A) $0
B) ($235,140)
C) ($52,140)
D) $30,540
91) Holts Corporation has two divisions: Xi and Sigma. Data from the most recent month appear
below:
Xi
Sigma
Sales
$
311,000
$
346,000
Variable expenses
$
65,310
$
169,540
Traceable fixed expenses
$
176,000
$
135,000
The company's common fixed expenses total $78,840. The break-even in sales dollars for the
company as a whole is closest to:
A) $487,491
B) $606,715
C) $466,018
D) $119,225
92) WV Construction has two divisions: Remodeling and New Home Construction. Each
division has an on-site supervisor who is paid a salary of $58,000 annually and one salaried
estimator who is paid $52,000 annually. The corporate office has two office administrative
assistants who are paid salaries of $38,000 and $31,000 annually. The president's salary is
$127,000. How much of these salaries are common fixed expenses?
A) $127,000
B) $110,000
C) $196,000
D) $306,000
93) Nuzum Corporation has two divisions: Division M and Division N. Data from the most
recent month appear below:
Total
Company
Division M
Division N
Sales
$
557,000
$
254,000
$
303,000
Variable expenses
144,910
81,280
63,630
Contribution margin
412,090
172,720
239,370
Traceable fixed expenses
273,000
128,000
145,000
Segment margin
139,090
44,720
94,370
Common fixed expenses
94,690
43,180
51,510
Net operating income
$
44,400
$
1,540
$
42,860
Management has allocated common fixed expenses to the Divisions based on their sales. The
break-even in sales dollars for Division N is closest to:
A) $248,747
B) $496,987
C) $183,544
D) $303,405
94) Mckissic Corporation has two divisions: Domestic and Foreign. Data from the most recent
month appear below:
Total
Company
Domestic
Foreign
Sales
$
450,000
$
119,000
$
331,000
Variable expenses
157,240
38,080
119,160
Contribution margin
292,760
80,920
211,840
Traceable fixed expenses
226,000
57,000
169,000
Segment margin
66,760
$
23,920
$
42,840
Common fixed expenses
58,500
Net operating income
$
8,260
The break-even in sales dollars for the company as a whole is closest to:
A) $437,304
B) $347,886
C) $394,323
D) $89,418
95) Muckleroy Corporation has two divisions: Division K and Division L. Data from the most
recent month appear below:
Total
Company
Division K
Division L
Sales
$
544,000
$
248,000
$
296,000
Variable expenses
187,760
54,560
133,200
Contribution margin
356,240
193,440
162,800
Traceable fixed expenses
254,000
136,000
118,000
Segment margin
102,240
57,440
44,800
Common fixed expenses
54,400
24,800
29,600
Net operating income
$
47,840
$
32,640
$
15,200
Management has allocated common fixed expenses to the Divisions based on their sales. The
break-even in sales dollars for Division K is closest to:
A) $244,103
B) $206,154
C) $174,359
D) $470,945
96) Carlton Corporation has two divisions: Delta and Echo. Data from the most recent month
appear below:
Delta
Echo
Sales
$
254,000
$
147,000
Variable expenses
$
91,440
$
86,730
Traceable fixed expenses
$
99,000
$
44,000
The company's common fixed expenses total $44,110. The break-even in sales dollars for Echo
Division is closest to:
A) $146,756
B) $336,719
C) $214,902
D) $107,317
97) Caruso Inc., which produces a single product, has provided the following data for its most
recent month of operations:
Number of units produced
4,000
Variable costs per unit:
Direct materials
$
39
Direct labor
$
71
Variable manufacturing overhead
$
5
Variable selling and administrative expense
$
8
Fixed costs:
Fixed manufacturing overhead
$
220,000
Fixed selling and administrative expense
$
308,000
There were no beginning or ending inventories.
The unit product cost under absorption costing was:
A) $170 per unit
B) $115 per unit
C) $255 per unit
D) $110 per unit
98) Caruso Inc., which produces a single product, has provided the following data for its most
recent month of operations:
Number of units produced
4,000
Variable costs per unit:
Direct materials
$
39
Direct labor
$
71
Variable manufacturing overhead
$
5
Variable selling and administrative expense
$
8
Fixed costs:
Fixed manufacturing overhead
$
220,000
Fixed selling and administrative expense
$
308,000
There were no beginning or ending inventories.
The unit product cost under variable costing was:
A) $115 per unit
B) $123 per unit
C) $118 per unit
D) $170 per unit
99) Davison Corporation, which has only one product, has provided the following data
concerning its most recent month of operations:
Selling price
$
95
Units in beginning inventory
0
Units produced
5,000
Units sold
4,900
Units in ending inventory
100
Variable costs per unit:
Direct materials
$
26
Direct labor
$
40
Variable manufacturing overhead
$
1
Variable selling and administrative expense
$
4
Fixed costs:
Fixed manufacturing overhead
$
40,000
Fixed selling and administrative expense
$
73,500
What is the total period cost for the month under variable costing?
A) $133,100
B) $113,500
C) $40,000
D) $93,100
100) Davison Corporation, which has only one product, has provided the following data
concerning its most recent month of operations:
Selling price
$
95
Units in beginning inventory
0
Units produced
5,000
Units sold
4,900
Units in ending inventory
100
Variable costs per unit:
Direct materials
$
26
Direct labor
$
40
Variable manufacturing overhead
$
1
Variable selling and administrative expense
$
4
Fixed costs:
Fixed manufacturing overhead
$
40,000
Fixed selling and administrative expense
$
73,500
What is the total period cost for the month under the absorption costing?
A) $93,100
B) $133,100
C) $40,000
D) $73,500
101) Tat Corporation produces a single product and has the following cost structure:
Number of units produced each year
7,000
Variable costs per unit:
Direct materials
$
77
Direct labor
$
89
Variable manufacturing overhead
$
5
Variable selling and administrative expense
$
3
Fixed costs:
Fixed manufacturing overhead
$
532,000
Fixed selling and administrative expense
$
574,000
The unit product cost under absorption costing is:
A) $247 per unit
B) $166 per unit
C) $332 per unit
D) $171 per unit
102) Tat Corporation produces a single product and has the following cost structure:
Number of units produced each year
7,000
Variable costs per unit:
Direct materials
$
77
Direct labor
$
89
Variable manufacturing overhead
$
5
Variable selling and administrative expense
$
3
Fixed costs:
Fixed manufacturing overhead
$
532,000
Fixed selling and administrative expense
$
574,000
The unit product cost under variable costing is:
A) $169 per unit
B) $171 per unit
C) $247 per unit
D) $174 per unit
103) Baughn Corporation, which has only one product, has provided the following data
concerning its most recent month of operations:
Selling price
$
115
Units in beginning inventory
0
Units produced
6,600
Units sold
6,400
Units in ending inventory
200
Variable costs per unit:
Direct materials
$
26
Direct labor
$
46
Variable manufacturing overhead
$
7
Variable selling and administrative expense
$
9
Fixed costs:
Fixed manufacturing overhead
$
105,600
Fixed selling and administrative expense
$
51,200
What is the unit product cost for the month under variable costing?
A) $104 per unit
B) $79 per unit
C) $88 per unit
D) $95 per unit
104) Baughn Corporation, which has only one product, has provided the following data
concerning its most recent month of operations:
Selling price
$
115
Units in beginning inventory
0
Units produced
6,600
Units sold
6,400
Units in ending inventory
200
Variable costs per unit:
Direct materials
$
26
Direct labor
$
46
Variable manufacturing overhead
$
7
Variable selling and administrative expense
$
9
Fixed costs:
Fixed manufacturing overhead
$
105,600
Fixed selling and administrative expense
$
51,200
What is the unit product cost for the month under absorption costing?
A) $79 per unit
B) $95 per unit
C) $104 per unit
D) $88 per unit
105) Ross Corporation produces a single product. The company has direct materials costs of $8
per unit, direct labor costs of $6 per unit, and manufacturing overhead of $10 per unit. Sixty
percent of the manufacturing overhead is for fixed costs. In addition, variable selling and
administrative expenses are $2 per unit, and fixed selling and administrative expenses are $3 per
unit at the current activity level. Assume that direct labor is a variable cost.
Under absorption costing, the unit product cost is:
A) $24 per unit
B) $20 per unit
C) $26 per unit
D) $29 per unit
106) Ross Corporation produces a single product. The company has direct materials costs of $8
per unit, direct labor costs of $6 per unit, and manufacturing overhead of $10 per unit. Sixty
percent of the manufacturing overhead is for fixed costs. In addition, variable selling and
administrative expenses are $2 per unit, and fixed selling and administrative expenses are $3 per
unit at the current activity level. Assume that direct labor is a variable cost.
Under variable costing, the unit product cost is:
A) $24 per unit
B) $20 per unit
C) $18 per unit
D) $21 per unit
99
107) Columbia Corporation produces a single product. The company's variable costing income
statement for November appears below:
Columbia Corporation
Income Statement
For the Month ended November 30
Sales ($30 per unit)
$
1,200,000
Variable expenses:
Variable cost of goods sold
720,000
Variable selling expense
160,000
Total variable expenses
880,000
Contribution margin
320,000
Fixed expenses:
Manufacturing
140,000
Selling and administrative
35,000
Total fixed expenses
175,000
Net operating income
$
145,000
During November, 35,000 units were manufactured and 8,000 units were in beginning
inventory. Variable production costs have remained constant on a per unit basis over the past
several months.
The value of the company's inventory on November 30 under absorption costing would be:
A) $54,000
B) $66,000
C) $78,000
D) $81,000
