TEST BANK Managerial Accounting 17th Edition
by Garrison
ANSWERS ARE LOCATED IN THE SECOND PART OF THIS DOCUMENT
,ESSAY. Write your answer in the space provided or on a separate sheet of paper.
1)
Dobosh Corporation has provided the following information:
Cost per
Unit
Cost per
Period
Direct materials
$ 7.05
Direct labor
$ 3.65
Variable manufacturing overhead
$ 1.60
Fixed manufacturing overhead
$ 113,400
Sales commissions
$ 1.50
Variable administrative expense
$ 0.55
Fixed selling and administrative expense
$ 36,450
Required:
a. For financial reporting purposes, what is the total amount of product costs incurred to
make
9,000 units?
b. For financial reporting purposes, what is the total amount of period costs incurred to
sell
9,000 units?
c. If 10,000 units are sold, what is the variable cost per unit sold?
d. If 10,000 units are sold, what is the total amount of variable costs related to the units
sold?
e. If 10,000 units are produced, what is the total amount of manufacturing overhead cost
,incurred?
f. If the selling price is $21.60 per unit, what is the contribution margin per unit sold?
g. If 8,000 units are produced, what is the total amount of direct manufacturing cost
incurred?
h. If 8,000 units are produced, what is the total amount of indirect manufacturing costs
incurred?
i. What incremental manufacturing cost will the company incur if it increases production
from
9,000 to 9,001 units?
, 2
Question Details
AACSB : Analytical Thinking
AICPA : BB Critical Thinking
AICPA : FN Measurement
Bloom's : Apply
Type : Static
Difficulty : 1 Easy
Accessibility : Keyboard Navigation
Accessibility : Screen Reader Compatible
Learning Objective : 01-01 Understand cost classifications used for assigning costs to cost
objects:
Learning Objective : 01-03 Understand cost classifications used to prepare financial
statements: prod
Learning Objective : 01-02 Identify and give examples of each of the three basic
manufacturing cost c
Learning Objective : 01-04 Understand cost classifications used to predict cost behavior:
variable co
Learning Objective : 01-05 Understand cost classifications used in making decisions:
relevant costs a
Learning Objective : 01-06 Prepare income statements for a merchandising company using
the traditiona
Topic : Cost Classifications for Assigning Costs to Cost Objects
Topic : Cost Classifications for Decision Making
Topic : Cost Classifications for Manufacturing Companies
Topic : Cost Classifications for Predicting Cost Behavior
Topic : Cost Classifications for Preparing Financial Statements
Topic : Using Different Cost Classifications for Different Purposes
2)
Saxbury Corporation's relevant range of activity is 3,000 units to 7,000 units. When it
produces and sells 4,200 units, its average costs per unit are as follows:
Average Cost per
Unit
Direct materials
$ 6.60
Direct labor
$ 3.40
Variable manufacturing overhead
$ 1.40
by Garrison
ANSWERS ARE LOCATED IN THE SECOND PART OF THIS DOCUMENT
,ESSAY. Write your answer in the space provided or on a separate sheet of paper.
1)
Dobosh Corporation has provided the following information:
Cost per
Unit
Cost per
Period
Direct materials
$ 7.05
Direct labor
$ 3.65
Variable manufacturing overhead
$ 1.60
Fixed manufacturing overhead
$ 113,400
Sales commissions
$ 1.50
Variable administrative expense
$ 0.55
Fixed selling and administrative expense
$ 36,450
Required:
a. For financial reporting purposes, what is the total amount of product costs incurred to
make
9,000 units?
b. For financial reporting purposes, what is the total amount of period costs incurred to
sell
9,000 units?
c. If 10,000 units are sold, what is the variable cost per unit sold?
d. If 10,000 units are sold, what is the total amount of variable costs related to the units
sold?
e. If 10,000 units are produced, what is the total amount of manufacturing overhead cost
,incurred?
f. If the selling price is $21.60 per unit, what is the contribution margin per unit sold?
g. If 8,000 units are produced, what is the total amount of direct manufacturing cost
incurred?
h. If 8,000 units are produced, what is the total amount of indirect manufacturing costs
incurred?
i. What incremental manufacturing cost will the company incur if it increases production
from
9,000 to 9,001 units?
, 2
Question Details
AACSB : Analytical Thinking
AICPA : BB Critical Thinking
AICPA : FN Measurement
Bloom's : Apply
Type : Static
Difficulty : 1 Easy
Accessibility : Keyboard Navigation
Accessibility : Screen Reader Compatible
Learning Objective : 01-01 Understand cost classifications used for assigning costs to cost
objects:
Learning Objective : 01-03 Understand cost classifications used to prepare financial
statements: prod
Learning Objective : 01-02 Identify and give examples of each of the three basic
manufacturing cost c
Learning Objective : 01-04 Understand cost classifications used to predict cost behavior:
variable co
Learning Objective : 01-05 Understand cost classifications used in making decisions:
relevant costs a
Learning Objective : 01-06 Prepare income statements for a merchandising company using
the traditiona
Topic : Cost Classifications for Assigning Costs to Cost Objects
Topic : Cost Classifications for Decision Making
Topic : Cost Classifications for Manufacturing Companies
Topic : Cost Classifications for Predicting Cost Behavior
Topic : Cost Classifications for Preparing Financial Statements
Topic : Using Different Cost Classifications for Different Purposes
2)
Saxbury Corporation's relevant range of activity is 3,000 units to 7,000 units. When it
produces and sells 4,200 units, its average costs per unit are as follows:
Average Cost per
Unit
Direct materials
$ 6.60
Direct labor
$ 3.40
Variable manufacturing overhead
$ 1.40
