Which one of the following is not correct about variable costing systems? Select one: O a. Focuses on variable manufacturing costs only O b. Product cost does not include variable selling expenses. O c. Calculate product cost as the sum of directs materials, direct labor ar overhead costs O d. Normally result into a lower product cost compared to absorption c

Which one of the following is not correct about variable costing systems? Select one: O a. Focuses on variable manufacturing costs only O b. Product cost does not include variable selling expenses. O c. Calculate product cost as the sum of directs materials, direct labor ar overhead costs O d. Normally result into a lower product cost compared to absorption c

Excel Applications for Accounting Principles

4th Edition

ISBN:9781111581565

Author:Gaylord N. Smith

Publisher:Gaylord N. Smith

Chapter16: Manufacturing Accounting (mfg)

Section: Chapter Questions

Problem 4R: Open MFG2 and click the Chart sheet tab. The management of Twisp is convinced that the quality of...

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Which of the following statements is false? I. Absorption Costing Method differs from Variable Costing Method in terms of Fixed Manufacturing Overhead Cost. II. When production level are expected to decline within a relevant range, Fixed costs per unit increases and Variable Cost per unit decreases. III. Determining the "right" level of capacity is one of the most strategic and difficult decisions managers face. III. Variable Costing differs to Absorption costing only in one aspect, that is how to account for Fixed Manufacturing costs. a. I b. II c. III d. IV e. None of the statements is false.
Which of the following statement is false? O The only difference between absorption costing and variable costing is howthe variable MOH is treated. O A traditional income statement uses absorption costing, where both variableand fixed manufacturing costs are included when calculating the productcost. O For external financial reporting purposes, GAP requires the traditionalformat income statement. O For external financial reporting purposes, companies need to classify theircosts as product costs or period costs following GAAP.
ch7-q39 I have asked this question yesterday and this is a follow up on it : why did you use unit variable manufacturing cost as total variable cost minus? Also, you didn't answer the question : Which is used in cost-volume-profit analysis? variable selling expence and not also variable factory overhead? Units Sold to Break Even, Unit Variable Cost, Unit Manufacturing Cost, Units to Earn Target Income Werner Company produces and sells disposable foil baking pans to retailers for $2.95 per pan. The variable cost per pan is as follows: Direct materials $0.22 Direct labor 0.56 Variable factory overhead 0.70 Variable selling expense 0.13 Fixed manufacturing cost totals $303,290 per year. Administrative cost (all fixed) totals $41,358. Required: 1. Compute the number of pans that must be sold for Werner to break even. pans 2. Conceptual Connection: What is the unit variable cost? What is the unit variable manufacturing cost? Round your answers to the nearest cent. Unit…
Choose the letter of the correct answer 1. Statement 1: Product cost under Variable costing are Direct Material, Direct Material and Variable Overhead only. Statement 2: Under absorption costing, Factory Overhead is considered as indirect product cost. A. Both statements are True B. Both statements are False C. Statement 1 is true. Statement 2 is false D. Statement 1 is false. Statement 2 is true 2. Statement 1. Selling cost is treated as expenses under variable costing. Statement 2. If sales for a period exceed production, then variable costing income will be higher than absorption costing income. A. Both statements are True B. Both statements are False C. Statement 1 is true. Statement 2 is false D. Statement 1 is false. Statement 2 is true
The Connors Company has assembled the following data pertaining to certain costs that cannot beeasily identified as either fixed or variable. Connors Company has heard about a method of measuringcost functions called the high-low method and has decided to use it in this situation.A company has heard about a method of measuring cost functions called the regression analysis and hasdecided to use it in this situation.Cost Hours$23,000 5,000$26,000 6,450$34,600 7,650$42,000 10,000$38,000 9,350What is the estimated total cost at an operating level of 9,000 hours?A) $34,200B) $38,200C) $41,400D) $37,800 Work question #7 using regression analysis
1. Costs that do not change with the change in the level of production for some time is classified as ________. variable costs fixed costs mixed costs None of these choices are correct. 2. Under variable costing, the cost of goods manufactured consists of all except direct materials. direct labor. variable factory overhead. fixed factory overhead. 3. Costs that have characteristics of both a variable cost and a fixed cost are classified as ________. variable costs fixed costs mixed costs None of these choices are correct.
Mastery Problem: Variable Costing for Management Analysis Absorption vs. Variable Operating income is one of the most important items reported by a company. Depending on the decision-making needs of management, operating income can be determined using absorption costing or variable costing. Select whether the following characteristics are most often associated with absorption costing or variable costing. Required under generally accepted accounting principles (GAAP) Often used for internal use in decision making Cost of goods manufactured includes only variable manufacturing costs Used in reports prepared for external users Fixed factory overhead costs are not part of cost of goods manufactured Both fixed and variable factory costs are included in cost of goods sold and inventory Absorption Statement Absorption costing does not distinguish between variable and fixed costs. All manufacturing costs are included in the cost of…
True or False Product cost under Variable costing are DM, DL and VOH only. Under absorption costing, FOH is considered as indirect product cost. 3. Depreciation cost is always product cost 4. Depreciation cost is always period cost 5. Selling expense if always part of period cost, regardless of product costing system 6. Income under absorption is always greater than variable costing because of deferment of FOH 7. Selling cost is treated as expenses under variable costing. 8. If sales for a period exceeds production, then variable costing income will be higher than absorption costing income
Frisco Corporation is analyzing its fixed and variable costs within its current relevant range. As its cost driver activity changes within the relevant range, which of the following statements is/are correct? I. As the cost driver level increases, total fixed cost remains unchanged. II. As the cost driver level increases, unit fixed cost increases. III. As the cost driver level decreases, unit variable cost decreases. 1. I, II, and III are correct. 2. I and II only are correct. 3. I only is correct. 4. II and III only are correct.
The MTN Company has assembled the following data pertaining to certain costs which cannot be easily identified as either fixed or variable. MTN has heard about a method of measuring cost functions called the high-low method and has decided to use it in this situation Cost Hours $100,000 3,500 61,o00 2,000 85,000 2,600 78,200 2,450 91,000 3,000 110,400 3,900 106,000 3,740 93,000 3,380 Calculate the variable cost per hour Calculate the total fixed costs Write the equation which measures the cost behavior of the costs Calculate the operating costs for 3,750
Identify if true or false 1. If the ending inventories happened to be zero, the net profit reported under absorption costing will be greater than reported under variable costing 2. The primary reason of variances in net operating income under variable costing and absorption costing is the change in fixed cost 3. When inventory increases, the net operating income under absorption costing decreases 4. When inventory decreases, the net operating income under absorption costing is ALWAYS lower than of variable costing. 5.When inventory decreases the fixed manufacturing overhead is deferred in inventory. 6. The change in production does not affect net operating income under variable costing system. *
Falsetta Corporation makes three products that use the current constraint, which is a particular type of machine. Data concerning those products appear below: ZA JK DHSelling price per unit........................ $402.67 $462.82 $374.06Variable cost per unit....................... $307.53 $344.56 $285.56Time on the constraint (minutes) ...... 6.70 7.30 5.90 Required:a. Rank the products in order of their current profitability from the most profitable to the least profitable. In other words, rank the products in the order in which they should be emphasized. Show your work! b. Assume that sufficient constraint time is available to satisfy demand for all but the least profitable product. Up to how much should the company be willing to pay to acquire more of the constrained resource?