Chapter 02 – Managerial Accounting and Cost Concepts
58. In September direct labor was 40% of conversion cost. If the manufacturing overhead for
the month was $66,000 and the direct materials cost was $20,000, the direct labor cost was:
Chapter 02 – Managerial Accounting and Cost Concepts
59. Aberge Company’s manufacturing overhead is 60% of its total conversion costs. If direct
labor is $38,000 and if direct materials are $21,000, the manufacturing overhead is:
Chapter 02 – Managerial Accounting and Cost Concepts
60. During the month of September, direct labor cost totaled $11,000 and direct labor cost
was 40% of prime cost. If total manufacturing costs during September were $73,000, the
manufacturing overhead was:
Chapter 02 – Managerial Accounting and Cost Concepts
61. A manufacturing company prepays its insurance coverage for a three-year period. The
premium for the three years is $2,700 and is paid at the beginning of the first year. Eighty
percent of the premium applies to manufacturing operations and 20% applies to selling and
administrative activities. What amounts should be considered product and period costs
respectively for the first year of coverage?
Chapter 02 – Managerial Accounting and Cost Concepts
62. Iadanza 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 $195.70 per unit.
The best estimate of the total contribution margin when 6,300 units are sold is:
Chapter 02 – Managerial Accounting and Cost Concepts
63. Gambarini 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 $197.80 per unit.
The best estimate of the total monthly fixed cost is:
Chapter 02 – Managerial Accounting and Cost Concepts
64. Bakker Corporation has provided the following production and average cost data for two
levels of monthly production volume. The company produces a single product.
The best estimate of the total variable manufacturing cost per unit is:
Chapter 02 – Managerial Accounting and Cost Concepts
65. Carbaugh Corporation has provided the following production and average cost data for
two levels of monthly production volume. The company produces a single product.
The best estimate of the total cost to manufacture 3,300 units is closest to:
Chapter 02 – Managerial Accounting and Cost Concepts
66. Edeen 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 variable manufacturing cost per unit is:
Chapter 02 – Managerial Accounting and Cost Concepts
67. Dabney 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:
Chapter 02 – Managerial Accounting and Cost Concepts
68. Haras 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 $141.30 per unit.
The best estimate of the total variable cost per unit is:
Chapter 02 – Managerial Accounting and Cost Concepts
69. Faraz 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 cost to manufacture 5,300 units is closest to:
Chapter 02 – Managerial Accounting and Cost Concepts
Chapter 02 – Managerial Accounting and Cost Concepts
70. Anderwald Corporation has provided the following production and average 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:
Chapter 02 – Managerial Accounting and Cost Concepts
71. Anaconda Mining Company shipped 9,000 tons of copper concentrate for $450,000 in
March and 11,000 tons for $549,000 in April. Shipping costs for 12,000 tons to be shipped in
May would be expected to be:
Chapter 02 – Managerial Accounting and Cost Concepts
72. Average maintenance costs are $1.50 per machine-hour at an activity level of 8,000
machine-hours and $1.20 per machine-hour at an activity level of 13,000 machine-hours.
Assuming that this activity is within the relevant range, total expected maintenance cost for a
budgeted activity level of 10,000 machine-hours would be closest to:
Chapter 02 – Managerial Accounting and Cost Concepts
73. The following data pertains to activity and the cost of cleaning and maintenance for two
recent months:
The best estimate of the total month 1 variable cost for cleaning and maintenance is:
Chapter 02 – Managerial Accounting and Cost Concepts
74. The following data pertains to activity and costs for two months:
Assuming that these activity levels are within the relevant range, the mixed cost for July was:
Chapter 02 – Managerial Accounting and Cost Concepts
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75. At an activity level of 9,200 machine-hours in a month, Nooner Corporation’s total
variable production engineering cost is $761,300 and its total fixed production engineering
cost is $154,008. What would be the total production engineering cost per unit, both fixed and
variable, at an activity level of 9,300 machine-hours in a month? Assume that this level of
activity is within the relevant range.
76. Jumpst Corporation uses the cost formula Y = $3,600 + $0.30X for the maintenance cost
in Department B, where X is machine-hours. The August budget is based on 20,000 hours of
planned machine time. Maintenance cost expected to be incurred during August is:
Chapter 02 – Managerial Accounting and Cost Concepts
77. Given the cost formula, Y = $9,000 + $2.50X, total cost for an activity level of 3,000 units
would be:
78. Blore Corporation reports that at an activity level of 7,300 units, its total variable cost is
$511,803 and its total fixed cost is $76,650. What would be the total cost, both fixed and
variable, at an activity level of 7,500 units? Assume that this level of activity is within the
relevant range.