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    Quiz 1 Answers PDF

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    Mariami
    The document contains 10 multiple choice and short answer questions related to cost accounting concepts. Specifically, it covers: 1) Period vs product costs, 2) Calculating cost of goods sold, gross margin, and operating income, 3) Variable and fixed costs per unit, 4) Contribution margin and break-even analysis, 5) Calculating costs such as cost of goods manufactured and cost of goods sold. It also includes two word problems applying these concepts.

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    Quiz 1 Answers PDF

    Uploaded by

    Mariami
    68 views4 pages
    The document contains 10 multiple choice and short answer questions related to cost accounting concepts. Specifically, it covers: 1) Period vs product costs, 2) Calculating cost of goods sold, gross margin, and operating income, 3) Variable and fixed costs per unit, 4) Contribution margin and break-even analysis, 5) Calculating costs such as cost of goods manufactured and cost of goods sold. It also includes two word problems applying these concepts.

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    The document contains 10 multiple choice and short answer questions related to cost accounting concepts. Specifically, it covers: 1) Period vs product costs, 2) Calculating cost of goods sold, gross margin, and operating income, 3) Variable and fixed costs per unit, 4) Contribution margin and break-even analysis, 5) Calculating costs such as cost of goods manufactured and cost of goods sold. It also includes two word problems applying these concepts.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    68 views4 pages

    Quiz 1 Answers PDF

    Uploaded by

    Mariami
    The document contains 10 multiple choice and short answer questions related to cost accounting concepts. Specifically, it covers: 1) Period vs product costs, 2) Calculating cost of goods sold, gross margin, and operating income, 3) Variable and fixed costs per unit, 4) Contribution margin and break-even analysis, 5) Calculating costs such as cost of goods manufactured and cost of goods sold. It also includes two word problems applying these concepts.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 4

    1. Which of the following is NOT a period cost?

    a. Marketing Cost
    b. General and administrative costs
    c. Research and development costs
    d. Manufacturing costs

    Answer the following question using the information below:

    Beginning finished goods, 1/1/20X3 $ 80 000

    Ending finished goods, 12/31/20X3 $ 67 000

    Cost of goods sold $ 270 000

    Sales revenue $ 500 000

    Operating expenses $ 145 000

    2. What is cost of goods manufactured for 20X3?

    270 000 + 67 000 – 80 000 = 257 000

    3. What is gross margin for 20x3?

    $500,000 - $270,000 = $230,000

    4. What is operating income for 20x3?

    $500,000 - $270,000 - 145,000 = $85,000

    5. What are the variable costs per unit associated with product Alta?

    UC=60+10+18+4=92

    6. What are the fixed costs per unit associated with product Alta?

    Fixed cost per unit = total fixed cost / number of unites

    FC=32+16=48
    7. The selling price per unit less the variable cost per unit is the:
    a. Fixed cost per unit
    b. Gross margin
    c. Margin of safety
    d. Contribution margin per unit

    Company sells a single product. 7 000 units were sold resulting in $ 70 000 of sales revenue. $ 28 000 of
    variable costs and $ 12 000 of fixed costs.

    8. Contribution margin per unit is:

    ($70,000 - $28,000) / 7,000 units = $6 per unit

    9. Breakeven point in units is:

    $12,000 / $6 = 2,000 units

    10. If sales increase by $25 000 operating income will increase by:

    [($70,000 - $28,000) / $70,000] x $25,000 = $15,000


    Problem #1

    Company sells car batteries to service stations for an average of $30 each. The variable cost of each battery
    is $20 and monthly fixed manufacturing costs total $10 000. Other monthly fixed costs of the company
    total $3 000.

    a) What is the breakeven point in batteries?


    b) What is the margin of safety, assuming sales total $60 000?
    c) What is the breakeven level in batteries, assuming variable costs increase by 20%?
    d) What is the breakeven level in batteries, assuming the selling price goes up by 10%, fixed
    manufacturing costs decline by 10% and other fixed costs decline by $100?
    Problem #2

    Company had the following actives during 20X5:

    Direct materials:
    Beginning inventory $40 000

    Purchases $123 200

    Ending Inventory $20 800

    Direct manufacturing labor $32 000

    Manufacturing overhead $24 000

    Beginning work-in-process inventor $1 600

    Ending work-in-process inventory $8 000

    Beginning finished goods inventory $48 000

    Ending finished goods inventory $32 000

    a) What is the cost of direct materials used during 20X5?


    b) What is cost of goods manufactured for 20X5?
    c) What is cost of goods sold for 20X5?
    d) What amount of prime costs was added to production during 20X5?
    e) What amount of conversion costs was added to production during 20X5?

    a) $40,000 + $123,200 – $20,800 = $142,400

    b) $142,400 + $32,000 + $24,000 + $1,600 – $8,000 = $192,000

    c) $192,000 + $48,000 – $32,000 = $208,000

    d) $142,400 + $32,000 = $174,400

    e) $32,000 + $24,000 = $56,000

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