A partial listing of costs incurred at Pickle Corporation during October appears

1. A partial listing of costs incurred at Pickle Corporation during October appearsbelow:Direct materials………………………………………….Utilities, factory…………………………………………..Administrative salaries…………………………………Indirect labor……………………………………………..Sales commissions……………………………………..Depreciation of production equipment……………Depreciation of administrative equipment……….Direct labor………………………………………………..$157,000$6,000$99,000$25,000$54,000$46,000$30,000$114,000$61,000Advertising………………………………………………..The total of the manufacturing overhead costs listed above for October is:A. $77,000B. $348,00C. $592,00D. $31,0002. Ensign Inc. is a merchandising company. Last month the company’s cost ofgoods sold was $61,000. The company’s beginning merchandise inventory was$11,000 and its ending merchandise inventory was $21,000. What was the totalamount of the company’s merchandise purchases for the month?A. $71,000B. $51,000C. $61,000D.$93,0003. Supply costs at Maxin Corporation’s chain of physical therapy clinics are listedbelow:Client­VisitsSupply CostMarch………………….11,647$28,561April…………………….11,443$28,395May…………………….11,975$28,819June……………………12,088$28,892July……………………..11,707$28,622August…………………11,193$28,221September…………..11,987$28,820October……………….11,678$28,578November…………….11,826$28,703Management believes that supply cost is a mixed cost that depends on client­visits.Using the high­low method to estimate the variable and fixed components of thiscost, those estimates would be closest to:A. $0.79 per client­visit; $19,321 per monthB. $1.33 per client­visit; $12,768 per monthC. $0.75 per client­visit; $19,826 per monthD. $2.44 per client­visit; $28,623 per month4. Given the cost formula,Y = $9,000 + $2.50X, totalcost for an activity level of3,000 units would be:A.$7,500B. $16,500C. $12,000D. $9,7505. The following data pertains to activity and costs for two months:JuneJulyActivity levels in units……….10,00020,000Variable cost…………………..$20,000$ ?Fixed cost………………………15,000?Mixed cost………………………10,000?Total cost……………………..$45,000$70,000Assuming that these activity levels are within the relevant range, the mixed costfor July was:A. $15,000B. $35,000C. $10,000D. $40,0006. Instagratin Corporation is a wholesaler that sells a single product. Managementhas provided the following cost data for two levels of monthly sales volume. Thecompany sells the product for $141.30 per unit.Sales volume (units)……………………..6,0007,000Cost of sales………………………………..$347,400$405,300Selling and administrative costs………$436,800$458,500The best estimate of the total variable cost per unit is:A. $79.60B. $123.40C. $57.90D. $130.707. Endentin Corporation has provided the following production and average costdata for two levels of monthly production volume. The company produces a singleproduct.Production volume…………..4,000 units5,000 unitsDirect materials……………….$89.70 per unit$89.70 per unitDirect labor…………………….$22.60 per unit$22.60 per unitManufacturing overhead…..$70.50 per unit$60.30 per unitThe best estimate of the total variable manufacturing cost per unit is:A. $112.30B. $19.50C. $89.70D. $131.808. Credenza Corporation is a wholesaler that sells a single product. Managementhas provided the following cost data for two levels of monthly sales volume. Thecompany sells the product for $195.70 per unit.Sales volume (units)……………………..6,0007,000Cost of sales………………………………..$457,800$534,100Selling and administrative costs………$621,000$639,100The best estimate of the total contribution margin when 6,300 units are sold is:A. $177,030B. $638,190C. $752,220D. $100,1709. A manufacturing company prepays its insurance coverage for a three­yearperiod. The premium for the three years is $2,700 and is paid at the beginning ofthe first year. Eighty percent of the premium applies to manufacturing operationsand 20% applies to selling and administrative activities. What amounts should beconsidered product and period costs respectively for the first year of coverage?ProductPeriodOption A$2,700$0Option B$2,160$540Option C$1,440$360Option D$720$180Option COption AOption DOption B10. In September direct labor was 40% of conversion cost. If the manufacturingoverhead for the month was $66,000 and the direct materials cost was $20,000, thedirect labor cost was:A. $99,000B. $13,333C. $44,000D. $30,00011. Which of the following costs is often important in decision making, but isomitted from conventional accounting records?A. Indirect cost.B. Opportunity cost.C. Sunk cost.D. Fixed cost.12. Last month, when 10,000 units of a product were manufactured, the cost perunit was $60. At this level of activity, variable costs are 50% of total unit costs. If10,500 units are manufactured next month and cost behavior patterns remainunchanged the:A. Fixed costs will increase in total.B. Variable cost per unit will increase.C. Total variable cost will remain unchanged.D. Total cost per unit will decrease.

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