Learning Objective: 01-04 Understand cost classifications used to predict cost behavior: variable costs, fixed costs, and mixed costs.
Bloom's: Apply
AACSB: Analytical Thinking
AICPA: BB Critical Thinking; FN Measurement
135) Brault Corporation has provided the following information:
Cost per Unit
Cost per Period
Direct materials
$
6.85
Direct labor
$
3.85
Variable manufacturing overhead
$
1.25
Fixed manufacturing overhead
$
97,200
Sales commissions
$
1.00
Variable administrative expense
$
0.55
Fixed selling and administrative expense
$
40,500
If 10,000 units are sold, the variable cost per unit sold is closest to:
A) $22.75
B) $11.95
C) $13.50
D) $28.80
Answer: C
Explanation:
Direct materials
$
6.85
Direct labor
3.85
Variable manufacturing overhead
1.25
Sales commissions
1.00
Variable administrative expense
0.55
Variable cost per unit sold
$
13.50
Difficulty: 1 Easy
Topic: Cost Classifications for Predicting Cost Behavior
Learning Objective: 01-04 Understand cost classifications used to predict cost behavior: variable costs, fixed costs, and mixed costs.
Bloom's: Apply
AACSB: Analytical Thinking
AICPA: BB Critical Thinking; FN Measurement
136) Given the cost formula, Y = $16,000 + $3.40X, total cost for an activity level of 4,000 units would be:
A) $13,600
B) $3,600
C) $29,600
D) $16,000
Answer: C
Explanation:
Y = $16,000 + ($3.40 per unit × X)
= $16,000 + ($3.40 per unit × 4,000 units)
= $16,000 + $13,600
= $29,600
Difficulty: 1 Easy
Topic: Cost Classifications for Predicting Cost Behavior
Learning Objective: 01-04 Understand cost classifications used to predict cost behavior: variable costs, fixed costs, and mixed costs.
Bloom's: Apply
AACSB: Analytical Thinking
AICPA: BB Critical Thinking; FN Measurement
137) Sparacino Corporation has provided the following information:
Cost per Unit
Cost per Period
Direct materials
$
6.90
Direct labor
$
3.90
Variable manufacturing overhead
$
1.70
Fixed manufacturing overhead
$
25,200
Sales commissions
$
1.50
Variable administrative expense
$
0.55
Fixed selling and administrative expense
$
8,100
If 5,000 units are produced, the total amount of manufacturing overhead cost is closest to:
A) $24,750
B) $42,650
C) $33,700
D) $29,225
Answer: C
Explanation:
Total variable manufacturing overhead cost ($1.70 per unit × 5,000 units)
$
8,500
Total fixed manufacturing overhead cost
25,200
Total manufacturing overhead cost (a)
$
33,700
Difficulty: 1 Easy
Topic: Cost Classifications for Predicting Cost Behavior
Learning Objective: 01-04 Understand cost classifications used to predict cost behavior: variable costs, fixed costs, and mixed costs.
Bloom's: Apply
AACSB: Analytical Thinking
AICPA: BB Critical Thinking; FN Measurement
138) Given the cost formula Y = $23,000 + $8X, total cost at an activity level of 7,000 units would be:
A) $33,000
B) $79,000
C) $23,000
D) $56,000
Answer: B
Explanation:
Y = $23,000 + ($8 per unit × 7,000 units)
Y = $23,000 + $56,000
Y = $79,000