Average manufacturing overhead cost per unit usually varies from one periodito the next because:O fixed manufacturing overhead changes in total when production levels varyO the makeup of manufacturing overhead changes from period to periodO fxed manufacturing overhead remains the same in total when production levels varyO variable overhead costs per unit vary when production levels vary

Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…

Average manufacturing overhead cost per unit usually varies from one periodto the next because: O feed manutacturing overhead changes in total when production levels vary O the make of manufacturing overhead changes from period to period O fed manufacturing overhead remains the same in total when production levels vary O variable overhead costs per unit vary when production levels vary

Average manufacturing overhead cost per unit usually varies from one periodto the next because: O feed manutacturing overhead changes in total when production levels vary O the make of manufacturing overhead changes from period to period O fed manufacturing overhead remains the same in total when production levels vary O variable overhead costs per unit vary when production levels vary

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter6: Activity-based, Variable, And Absorption Costing

Section: Chapter Questions

Problem 16MC: Under variable costing, a unit of product includes which costs? direct material, direct labor, and...

See similar textbooks

Similar questions

In the variable costing income statement, how are the fixed manufacturing costs reported, and how are the fixed selling and administrative expenses reported?
Classify each of the following items of factory overhead as either a fixed or a variable cost. (Include any costs that you consider to be semivariable within the variable category. Remember that variable costs change in total as the volume of production changes.) Indirect labor Indirect materials Insurance on building Overtime premium pay Depreciation of building (straight-line method) Polishing compounds Depreciation of machinery (units-of-production method) Employer’s payroll taxes Property taxes Machine lubricants Employees’ hospital insurance (paid by employer) Labor for machine repairs Vacation pay Janitor’s wages Rent Small tools Plant manager’s salary Factory electricity Product inspector’s wages
The cost behavior patterns below are lettered A through H. The vertical axes of the graphs represent total dollars of expense, and the horizontal axes represent production in units, machine hours, or direct labor hours. In each case, the zero point is at the intersection of the two axes. Each graph may be used no more than once. Required: Select the graph that matches the lettered cost described here. a. Depreciation of equipmentthe amount of depreciation charged is computed based on the number of machine hours that the equipment was operated. b. Electricity billflat fixed charge, plus a variable cost after a certain number of kilowatt hours are used. c. City water billcomputed as follows: d. Depreciation of equipmentthe amount is computed by the straight-line method. e. Rent on a factory building donated by the citythe agreement calls for a fixed fee payment, unless 200,000 labor hours are worked, in which case no rent need be paid. f. Salaries of repair workersone repair worker is needed for every 1,000 machine hours or less (i.e., 0 to 1,000 hours requires one repair worker, 1,001 to 2,000 hours requires two repair workers, etc.).
In the variable costing income statement, how are the fixed manufacturing costs reported, and how are the fixed selling and administrative expenses reported?
Which of the following statements is true regarding average fixed costs? A. Average fixed costs per unit remain fixed regardless of level of activity. B. Average fixed costs per unit rise as the level of activity rises. C. Average fixed costs per unit fall as the level of activity rises. D. Average fixed costs per unit cannot be determined.
Under variable costing, a unit of product includes which costs? direct material, direct labor, and manufacturing overhead Direct material, direct labor, and variable manufacturing overhead Direct material, direct labor, and fixed manufacturing overhead D. Direct material, direct labor, and all variable manufacturing overhead
How do the multiple production department and the single plantwide factory overhead rate methods differ?
The component of per-unit costs that remains constant as the production level varies is: a. product cost b. fixed factory overhead c. variable factory overhead d. general and administrative expenses
Explain why the fixed manufacturing overhead cost per unit changes when there is a change in the number of units produced.
Classify each of the following items of factory overhead as either a fixed or a variable cost. (Include any costs that you consider to be semivariable within the variable category. Remember that variable costs change in total as the volume of production changes.
Variable costing is concerned with the variable costs and includes direct material, direct labor, and variable manufacturing overhead. The fixed manufacturing overhead is treated as a cost of the period under variable costing. Absorption costing uses the costs in variable costing and the per-unit cost of fixed manufacturing overhead. When inventory increases, the ending inventory includes a portion of the fixed manufacturing overhead in absorption costing. True / False
Question: In cost accounting, what is the primary purpose of calculating the predetermined overhead rate? A) To allocate indirect costs to products based on a predetermined formula.B) To determine the actual overhead costs incurred during a specific production period.C) To calculate variable costs associated with each unit of production.D) To assess fixed costs that remain constant regardless of production levels.