Carmelita Inc., has the following information available: Costs from Beginning Inventory Costs from current Period Direct materials $5,100 $22,000 Conversion costs 5,100 158,500 At the beginning of the period, there were 500 units in process that were 43% complete as to conversion costs and 100% complete as to direct materials costs. During the period, 4,800 units were started and completed. Ending inventory contained 300 units that were 24% complete as to conversion costs and 100% complete as to materials costs. The company uses the FIFO process cost method. The equivalent units of production for direct materials and conversion costs, respectively, were a.5,157 for direct materials and 5,157 for conversion costs b.5,157 for direct materials and 5,100 for conversion costs c.4,800 for direct materials and 5,157 for conversion costs d.5,100 for direct materials and 5,157 for conversion costs If sales are $277,000, variable costs are 75% of sales, and operating income is $44,500, what is the operating leverage? a.0.0 b.1.2 c.1.6 d.4.7 Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four separate activity pools. The budgeted activity cost and activity base data by product are provided below. Activity Cost Activity Base Procurement $350,500 Number of purchase orders Scheduling $206,400 Number of production orders Materials handling $451,100 Number of moves Product development $741,700 Number of engineering changes Production $1,576,500 Machine hours Number ofPurchaseOrders Number ofProductionOrders NumberofMoves Number ofEngineeringChanges MachineHours NumberofUnits Disk drives 4,130 270 1,500 14 1,900 2,200 Tape drives 1,800 225 510 5 8,300 3,900 Wire drives 11,900 1,000 3,500 21 10,100 2,500 Determine the activity rate per production order for scheduling. a.$19.66 b.$234.45 c.$77.66 d.$138.06

Carmelita Inc., has the following information available: Costs from Beginning Inventory Costs from current Period Direct materials $5,100 $22,000 Conversion costs 5,100 158,500 At the beginning of the period, there were 500 units in process that were 43% complete as to conversion costs and 100% complete as to direct materials costs. During the period, 4,800 units were started and completed. Ending inventory contained 300 units that were 24% complete as to conversion costs and 100% complete as to materials costs. The company uses the FIFO process cost method. The equivalent units of production for direct materials and conversion costs, respectively, were a.5,157 for direct materials and 5,157 for conversion costs b.5,157 for direct materials and 5,100 for conversion costs c.4,800 for direct materials and 5,157 for conversion costs d.5,100 for direct materials and 5,157 for conversion costs If sales are $277,000, variable costs are 75% of sales, and operating income is $44,500, what is the operating leverage? a.0.0 b.1.2 c.1.6 d.4.7 Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four separate activity pools. The budgeted activity cost and activity base data by product are provided below. Activity Cost Activity Base Procurement $350,500 Number of purchase orders Scheduling $206,400 Number of production orders Materials handling $451,100 Number of moves Product development $741,700 Number of engineering changes Production $1,576,500 Machine hours Number ofPurchaseOrders Number ofProductionOrders NumberofMoves Number ofEngineeringChanges MachineHours NumberofUnits Disk drives 4,130 270 1,500 14 1,900 2,200 Tape drives 1,800 225 510 5 8,300 3,900 Wire drives 11,900 1,000 3,500 21 10,100 2,500 Determine the activity rate per production order for scheduling. a.$19.66 b.$234.45 c.$77.66 d.$138.06

Cornerstones of Cost Management (Cornerstones Series)

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ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 21E: Ellerson Company provided the following information for the last calendar year: During the year,...

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Carmelita Inc., has the following information available:

	Costs from Beginning Inventory	Costs from current Period
Direct materials	$5,100	$22,000
Conversion costs	5,100	158,500

At the beginning of the period, there were 500 units in process that were 43% complete as to conversion costs and 100% complete as to direct materials costs. During the period, 4,800 units were started and completed. Ending inventory contained 300 units that were 24% complete as to conversion costs and 100% complete as to materials costs. The company uses the FIFO process cost method.

The equivalent units of production for direct materials and conversion costs, respectively, were

a.5,157 for direct materials and 5,157 for conversion costs

b.5,157 for direct materials and 5,100 for conversion costs

c.4,800 for direct materials and 5,157 for conversion costs

d.5,100 for direct materials and 5,157 for conversion costs

If sales are $277,000, variable costs are 75% of sales, and operating income is $44,500, what is the operating leverage?

a.0.0

b.1.2

c.1.6

d.4.7

Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four separate activity pools. The budgeted activity cost and activity base data by product are provided below.

	Activity Cost		Activity Base
Procurement	$350,500						Number of purchase orders
Scheduling	$206,400						Number of production orders
Materials handling	$451,100						Number of moves
Product development	$741,700						Number of engineering changes
Production	$1,576,500						Machine hours

	Number of Purchase Orders	Number of Production Orders	Number of Moves	Number of Engineering Changes	Machine Hours	Number of Units
Disk drives	4,130			270				1,500	14	1,900	2,200
Tape drives	1,800			225				510	5	8,300	3,900
Wire drives	11,900			1,000				3,500	21	10,100	2,500

Determine the activity rate per production order for scheduling.

a.$19.66

b.$234.45

c.$77.66

d.$138.06

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