If each motorcycle requires a fan belt that costs $2.000 and between 1.500 and 2,000 motorcycles are produced in the month, the total cost for all of the fan belts used is: O considered to be a direct variable cost O considered to be an indirect variable cost. O considered to be a direct fixed cost. O considered to be an indirect fixed cost.

If each motorcycle requires a fan belt that costs $2.000 and between 1.500 and 2,000 motorcycles are produced in the month, the total cost for all of the fan belts used is: O considered to be a direct variable cost O considered to be an indirect variable cost. O considered to be a direct fixed cost. O considered to be an indirect fixed cost.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

Problem 5EA: Rose Company has a relevant range of production between 10,000 and 25.000 units. The following cost...

See similar textbooks

Similar questions

Manatoah Manufacturing produces 3 models of window air conditioners: model 101, model 201, and model 301. The sales price and variable costs for these three models are as follows: The current product mix is 4:3:2. The three models share total fixed costs of $430,000. Calculate the sales price per composite unit. What is the contribution margin per composite unit? Calculate Manatoahs break-even point in both dollars and units. Using an income statement format, prove that this is the break-even point.
Rose Company has a relevant range of production between 10,000 and 25.000 units. The following cost data represents average cost per unit for 15,000 units of production. Using the cost data from Rose Company, answer the following questions: If 10,000 units are produced, what is the variable cost per unit? If 18,000 units are produced, what is the variable cost per unit? If 21,000 units are produced, what are the total variable costs? If 11,000 units are produced, what are the total variable costs? If 19,000 units are produced, what are the total manufacturing overhead costs incurred? If 23,000 units are produced, what are the total manufacturing overhead costs incurred? If 19,000 units are produced, what are the per unit manufacturing overhead costs incurred? If 25,000 units are produced, what are the per unit manufacturing overhead costs incurred?
Baxter Company has a relevant range of production between 15,000 and 30,000 units. The following cost data represents average variable costs per unit for 25,000 units of production. Using the costs data from Rose Company, answer the following questions: A. If 15,000 units are produced, what is the variable cost per unit? B. If 28,000 units are produced, what is the variable cost per unit? C. If 21,000 units are produced, what are the total variable costs? D. If 29,000 units are produced, what are the total variable costs? E. If 17,000 units are produced, what are the total manufacturing overhead costs incurred? F. If 23,000 units are produced, what are the total manufacturing overhead costs incurred? G. If 30,000 units are produced, what are the per unit manufacturing overhead costs incurred? H. If 15,000 units are produced, what are the per unit manufacturing overhead costs incurred?
Your company manufactures bikes that sell for $10,000. Unit variable costs are $6,000 and totalmonthly fixed costs are $500,000. If your company is earning their target income amount of $2,400,00, what is the margin of safety expressed in both units and dollars?
A manufacturer is considering whether to make or buy a component used in its production. The annual cost of producing the 10,000 parts is as follows. Direct variable manufacturing costs $ 300,000Direct fixed manufacturing costs $ 100,000Allocated overhead $ 50,000 If the manufacture buys the component, the direct fixed manufacturing costs can be reduced by 35 per cent. What is the maximum unit purchasing price that makes purchasing a beneficial decision in comparison to making?
Harvey Automobiles uses a standard part in the manufacture of several of its trucks. The cost of producing 90,000 parts is $120,000, which includes fixed costs of $40,000 and variable costs of $80,000. The company can buy how the part from an outside supplier for $3.30 per unit and avoid 30% of the fixed costs. If Harvey makes the part, how much will its operating income be.
Bertha Corporation reports that at an activity level of 4,000 units, its total variable cost is $616,750 and its total fixed cost is $353,286. For the activity level of 4,800 units, i.e., 800 units more, (assuming that this activity level is within the relevant range), compute the total cost at that level. Show your work. Round your answer to the nearest dollar.
Limos Mfg. has been manufacturing furniture sets and is considering whether tomake or outsource its own seat cushions needed for its chairs. The expected priceof the cushions is P50 per unit.If it continue to produce the company would incur the following unit cost: Directmaterials P13, Direct Labor P15, Variable overhead 5, Fixed overhead (based onthe average production requirement of 10,000 units) P20 for a total of P53.Let us assume that materials and labor costs are expected to increase by 20% nextperiod. Factory overhead costs will remain the same, except that 40% of the fixedoverhead will be eliminated in case the company decides to buy the seat cushionsfrom other suppliers. Moreover, the facilities presently being used in the manufactureof seat cushions can be utilized to manufacture another part of the main product incase such facilities become vacant when the company decides to stop producing theseat cushions. The alternative use of resources would result into cost savings…
Dragon Sport Inc. manufactures and sells two products, baseball bats and baseball gloves. The fixed costs are $620,000, and the sales mix is 40% bats and 60% gloves. The unit selling price and the unit variable cost for each product are as follows: Product Unit Selling Price Unit Variable Cost Bats $90 $50 Gloves 105 65 Compute the break-even sales (units) for the overall product, E. How many units of each product, baseball bats and baseball gloves, would be sold at the break-even point?
If variable manufacturing costs are $15 per unit and total fixed manufacturing costs are $200,000, what is the manufacturing cost per unit if: d. 25,000 units are manufactured and the company uses the absorption costing concept? this is the only one i cant get
Lingkod Company, a manufacturer of furniture sets, is considering to purchase the seat cushions neededfor its chairs. The expected purchase price of these seat cushions is P50 per unit. Lingkod has been making its own seat cushions since it started operating. If it would continue to producethese cushions, the company expects to incur the ff costs: Raw materials - P13, Direct labor-P15, variableOH-P5 and Fixed OH (based on the average production requirement of 10,000 units)-P20.Should the company continue to make the seat cushion or buy from outside supplier?
Biz Tech Inc. is currently purchasing a standard part for $52 per unit which is used for manufacturing different types of appliances. The company is operating at 70% capacity and can make the part at a cost of $65 per unit which include an allocated fixed cost per unit of $11. If the company decide to use the idle manufacturing space to produce 30,000 units of parts, what would be the amount of increase or decrease in differential costs from making the part rather than purchasing? Group of answer choices Cost would be decreased or saved by $60,000 Cost would be increased by $150,000 Cost would be decreased by $150,000 Cost would be increased by $60,000