Principles of Cost Accounting
17th Edition
ISBN: 9781305087408
Author: Edward J. Vanderbeck, Maria R. Mitchell
Publisher: Cengage Learning
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Chapter 5, Problem 14E
To determine
Explain the reasons why increase in unit cost occurred in the given condition.
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Schonhardt Corporation's relevant range of activity is 2,900 units to 7,500 units. When it produces and sells 5,200 units, its average costs per unit are as follows: Average Cost per Unit Direct materials $ 7.20 Direct labor $ 3.40 Variable manufacturing overhead $ 1.25 Fixed manufacturing overhead $ 3.50 Fixed selling expense $ 0.85 Fixed administrative expense $ 0.55 Sales commissions $ 0.65 Variable administrative expense $ 0.55 If 6,500 units are produced, the total amount of fixed manufacturing cost incurred is closest to:
Multiple Choice
$23,400
$22,620
$18,200
$18,460
The Merchant Manufacturing Company has two service departments — purchasing and maintenance, and two production departments — fabrication and assembly. The distribution of each service department's efforts to the other departments is shown below:
FROM
TO
Purchasing
Maintenance
Fabrication
Assembly
Purchasing
0
%
30
%
45
%
25
%
Maintenance
70
%
0
%
20
%
10
%
The direct operating costs of the departments (including both variable and fixed costs) were as follows:
Purchasing
$
147,000
Maintenance
69,000
Fabrication
123,000
Assembly
99,000
The total cost accumulated in the assembly department using the step method is (calculate all ratios and percentages to 4 decimal places, for example 33.3333%, and round all dollar amounts to the nearest whole dollar):
Multiple Choice
a. $259,100.
b.$264,550.
c. $173,450.
d. $180,150.
e. $185,900.
Dake Corporation's relevant range of activity is 4,900 units to 5,500 units. When it produces and sells 5,200 units, its average costs per unit are as follows:
Average Cost per Unit
Direct materials
$
6.50
Direct labor
$
3.70
Variable manufacturing overhead
$
2.10
Fixed manufacturing overhead
$
3.00
Fixed selling expense
$
1.00
Fixed administrative expense
$
0.70
Sales commissions
$
0.80
Variable administrative expense
$
0.70
If 5,100 units are produced, the total amount of direct manufacturing cost incurred is closest to:
Chapter 5 Solutions
Principles of Cost Accounting
Ch. 5 - What are the two basic systems of cost accounting,...Ch. 5 - Following is a list of manufactured products. For...Ch. 5 - Give three examples of industries and companies...Ch. 5 - What is the primary difference between the two...Ch. 5 - What is the difference between the term unit cost...Ch. 5 - How do the two cost accounting systems differ in...Ch. 5 - What is the primary objective in accumulating...Ch. 5 - Prob. 8QCh. 5 - Prob. 9QCh. 5 - What would be the effect on the unit cost of...
Ch. 5 - What information is reflected on a production...Ch. 5 - What are the four main sections of a cost of...Ch. 5 - Prob. 13QCh. 5 - Prob. 14QCh. 5 - In determining the costs transferred to a third...Ch. 5 - Prob. 16QCh. 5 - Prob. 17QCh. 5 - Compute the equivalent production (unit output)...Ch. 5 - During the month, a company with no...Ch. 5 - Comacho Chemical Co. recorded costs for the month...Ch. 5 - Norwood Co. had 200 units in work in process at...Ch. 5 - Using the following data, determine which figures...Ch. 5 - The records of Burris Inc. reflect the following...Ch. 5 - The records of Stone Inc. reflect the following...Ch. 5 - Argo Manufacturing Co. had 500 units, three-fifths...Ch. 5 - AAA Appliances Inc. has two production...Ch. 5 - AAA Appliances Inc. has two production...Ch. 5 - Prob. 11ECh. 5 - Prob. 12ECh. 5 - Prob. 13ECh. 5 - Prob. 14ECh. 5 - Chavez Concrete Inc. has two production...Ch. 5 - Chavez Concrete Inc. has two production...Ch. 5 - Prob. 17ECh. 5 - Prob. 18ECh. 5 - Prob. 19ECh. 5 - Geneva Products Co. produces a latex paint and...Ch. 5 - Dublin Brewing Co. uses the process cost system....Ch. 5 - Kokomo Kayak Inc. uses the process cost system....Ch. 5 - Prob. 4PCh. 5 - Sifting, the second department in a...Ch. 5 - Forming, the second department in a...Ch. 5 - Premier Products Inc. has three departments and...Ch. 5 - Premier Products Inc. has three departments and...Ch. 5 - Aero Aluminum Inc. uses a process cost system. The...Ch. 5 - Aero Aluminum Inc. uses a process cost system. The...Ch. 5 - Prob. 11PCh. 5 - Petrini Products Co. has two departments: Mixing...Ch. 5 - Tanaka Manufacturing Co. uses the process cost...Ch. 5 - Syracuse Beverages Inc. has three plants that make...
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