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CH 1 Pre-Assignment Practice

If 4,000 units are produced by Perkey Corporation, the total direct manufacturing cost would be closest to $31,600. If 6,000 units are produced by Ouelette Corporation, the total indirect manufacturing cost would be closest to $22,800. Using the high-low method, the variable and fixed supply cost components for Coulthard Corporation's gyms are estimated to be $0.74 per client-visit and $19,940 per month, respectively.

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83 views6 pages

CH 1 Pre-Assignment Practice

If 4,000 units are produced by Perkey Corporation, the total direct manufacturing cost would be closest to $31,600. If 6,000 units are produced by Ouelette Corporation, the total indirect manufacturing cost would be closest to $22,800. Using the high-low method, the variable and fixed supply cost components for Coulthard Corporation's gyms are estimated to be $0.74 per client-visit and $19,940 per month, respectively.

Uploaded by

Faizan Bashir Sidhu
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Pre-Assignment Practice

CHAPTER 1 ACCT2001
1. Perkey Corporation has provided the following information:

Cost per Cost per


Unit Period
Direct materials $ 5.00
Direct labor $ 2.90
Variable manufacturing overhead $ 1.25
Fixed manufacturing overhead $ 21,000
Sales commissions $ 1.00
Variable administrative expense $ 0.55
Fixed selling and administrative expense $ 7,500

If 4,000 units are produced, the total amount of direct manufacturing cost incurred is closest to:

O $53,400
O $35,600
O $36,600
O $31,600

2. Ouelette Corporation's relevant range of activity is 3,000 units to 7,000 units. When it
produces and sells 5,000 units, its average costs per unit are as follows:

Average Cost per Unit


Direct materials $ 5.25
Direct labor $ 4.05
Variable manufacturing overhead $ 1.30
Fixed manufacturing overhead $ 3.00
Fixed selling expense $ 0.70
Fixed administrative expense $ 0.40
Sales commissions $ 0.50
Variable administrative expense $ 0.45

If 6,000 units are produced, the total amount of indirect manufacturing cost incurred is closest
to:

O $15,000
O $22,800
O $7,800
O $25,800

PRE-ASSIGNMENT PRACTICE | Chapter 1 ACCT2001


3. The following costs were incurred in May:

Direct materials $ 41,000


Direct labor $ 13,000
Manufacturing overhead$ 46,000
Selling expenses $ 18,000
Administrative expenses $ 15,000

Conversion costs during the month totaled:

O $54,000
O $133,000
O $59,000
O $87,000

4. The following costs were incurred in May:

Direct materials $ 33,000


Direct labor $ 13,000
Manufacturing overhead$ 23,000
Selling expenses $ 16,000
Administrative expense $ 34,000

Prime costs during the month totaled:

O $36,000
O $119,000
O $69,000
O $46,000

PRE-ASSIGNMENT PRACTICE | Chapter 1 ACCT2001


5. Phaup Corporation's relevant range of activity is 3,000 units to 7,000 units. When it produces
and sells 5,000 units, its average costs per unit are as follows:

Average Cost per Unit


Direct materials $ 4.85
Direct labor $ 4.00
Variable manufacturing overhead $ 1.75
Fixed manufacturing overhead $ 3.90
Fixed selling expense $ 0.90
Fixed administrative expense $ 0.60
Sales commissions $ 0.50
Variable administrative expense $ 0.45

For financial reporting purposes, the total amount of period costs incurred to sell 5,000 units is
closest to:

O $8,200
O $12,250
O $7,500
O $4,750

6. Timchak Corporation reports that at an activity level of 9,900 units, its total variable cost is
$919,116 and its total fixed cost is $259,974. What would be the total cost, both fixed and
variable, at an activity level of 10,100 units? Assume that this level of activity is within the
relevant range. (Round intermediate calculations to 2 decimal places.)

O $1,197,658
O $1,191,000
O $1,179,090
O $1,202,910

PRE-ASSIGNMENT PRACTICE | Chapter 1 ACCT2001


7. Kipling Corporation's relevant range of activity is 7,000 units to 11,000 units. When it produces
and sells 9,000 units, its average costs per unit are as follows:

Average
Cost per
Unit
Direct materials $ 4.85
Direct labor $ 4.20
Variable manufacturing overhead $ 1.55
Fixed manufacturing overhead $ 9.00
Fixed selling expense $ 3.15
Fixed administrative expense $ 1.80
Sales commissions $ 0.50
Variable administrative expense $ 0.45

If the selling price is $25.00 per unit, the contribution margin per unit sold is closest to:
O $13.45
O ($0.50)
O $5.40
O $15.95

8. Supply costs at Coulthard Corporation's chain of gyms are listed below:


Client-Visits Supply Cost
March 11,648 $ 28,560
April 11,581 $ 28,510
May 11,976 $ 28,802
June 12,100 $ 28,894
July 11,708 $ 28,604
August 11,194 $ 28,224
September 11,988 $ 28,811
October 11,679 $ 28,582
November 11,827 $ 28,692

Management believes that supply cost is a mixed cost that depends on client-visits. Use the high-low
method to estimate the variable and fixed components of this cost. Compute the variable component
first. Then compute the fixed component, rounding off to the nearest whole dollar. Those estimates
are closest to: (Round your intermediate calculations to 2 decimal places.)
Garrison 17e Rechecks 2021-11-23

O $2.43 per client-visit; $28,605 per month


O $1.32 per client-visit; $12,882 per month
O $0.78 per client-visit; $19,435 per month
O $0.74 per client-visit; $19,940 per month

PRE-ASSIGNMENT PRACTICE | Chapter 1 ACCT2001


ANSWERS:

1. $31,600
2. $22,800
3. $59,000
4. $46,000
5. $12,250
6. $1,197,658
7. $13.45
8. $0.74 per client-visit; $19,940 per month

PRE-ASSIGNMENT PRACTICE | Chapter 1 ACCT2001

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