6 Jenny was reviewing the water bili for her doggy day spa and determined that her highest bil1 g3 000 occurred in July when she washed 2 000 dogs and her lowest bill 2 000 occurred in November when she washed 1 000 dogs 44rat was the fixed rate for enny s water bill A 3 000 B 2 000 1 000 D 1 soo 7 Using account analysis what type of cost is the price of gasoline when your car gets 20 miles per 7 gallon and each gallon costs 3 10 A Fixed B Mixed Quu uot D Step 8 Gerry s Gym provides monthly memberships as well as personal training sessions The personal trainers earn 50 of the revenue for all personal training sessions The gym also sells nutrition products Gerry s general ledger accounts indicate the following for the year The front desk staff wages expense remains the same throughout the year 5 8 Account Membership revenue Personal training revenue Product sales Cost of product sold Front desk staff wages exP Amount 100 000 Account Personal trainer wages expense 50 000 Space rental expense Straight line depreciation expense 75 000 40 000 Rental insurance expense 10 000 Amount 24 000 4 000 2 000 If a contribution margin income statement is prepared for the year what is the contribution margin A 120 000 B 185 000 c 22s 000 uo ooo 9 pBA Company manufactures bowling balis The following data are available for last month All of e the bowling balls in beginning finished goods inventory were sold last month Beginning finished goods inventory Goods manufactured Ending finished goods inventorY Sales commissions Fixed manuf acturing overhead Fixed marketing expenses Sales Variable costs of manufacturing 1 bowling bail 0 12 000 ba1ls 2 000 bails 3 00 per bail sold 36 000 10 000 10 000 balls at 30 each 10 00 Using variable costing A 130 000 what is the operating income for last month B 19o ooo 6 rza ooo D 170 000 10 When the number of units produced is less than the number of units sold how does operating 10 income under variable costing differ from operating income under absorption costing A It is lower than operating income under absorption costing B It depends upon the amount of decline Q It is the same as operating lncome under absorption costing fq tt is higher than operating income under absorption costing 11 Centel Movies sel1s movie tickets for 10 per movie patron Variable costs are 4 per movie patron and fixed costs are 40 000 per rnonth The company s relevant range extends to 20 000 monthly movie patrons What is Centel s projected operating income if 20 000 movie patrons see movies during a month 11 S uo ooo B 160 000 c 12o ooo D 200 000 12 If the sale price per unit is 68 50 the variable expense per unit is 45 and total fixed expenses are 12 1 325 400 what will the breakeven sales in units be L 79 349 B 56 000 D 29 453 55 400 Q 13 If the sale price per unit is 32 total fixed expenses are 45 000 and the breakeven sales in dollars is 13 180 000 what will the variable expense per unit be A oo B 8 00 rnoo D 4 20 14 Sunbucks Coffee sells three large coffees for every two small ones A small coffee sells for 3 per 74 cup with a variable cost of 1 50 per cup A large coffee sells for 5 per cup with a variable cost of 3 per cup V 4rat is the weighted average contribution margin 0 B 6 00 C 1 s0 D 3 00 15 John sJymhasamonthlytargetoperatingincome of 24 000 Variableexpenses are60o o of sales and monthiy fixed expenses are 18 000 44rat is the monthly margin of safety as a percentage of target sales in dollars 15 A 175 0 c 43 D 75 16 John s Jym has a monthly target operating income of 24 000 Variable expenses are 60o o of sales 16 and monthly fixed expenses are 18 000 44rat is John s operating leverage factor at the target level of operating income A 43 B 75 c s7 1 75 BMGT 221 Review Exam 2 Sorine 20 0 Name MULTIPLE CHOICE Choose the one alternative that best completes the statement or answers the question 1 Kermey Company uses activity based cosiing to account for its manufacturing process Kenney Company produces tires each tire has 50 of direct materials includes 20 parts and requires 2 hours of machine iime Additional information follows 1 Activity Materials handling Machining Assembling Packaging Allocation Base Number of parts Machine hours Number of parts Number of finished units Cost Allocation Rate 16 per part 74 40 per machine hour 70 per part 5 40 per finished unit What is the cost of machining per tire A 26 40 B 29 50 S uo D 25 80 2 The production system designed to eliminate waste is called a n A traditional system C full costing system A appraisal cost C external failure cost B activitY based sYstem fi ust in time system J 7 Q JPrevention cost D internal failure cost 3 The cost of evaluating potential raw material suppliers is an example of a n 4 A standard costing system that starts manufacfuring costs to units sold and with completed output and works backward to assign to finished goods inventories is called A traditional cosLing 4s backflush costing B value added costing costing o utoution 5 Within the relevant range which of the following statements is true with respect to fixed costs per 5 unit A They will decrease as production decreases B They wiil remain the same as production levels change C They will increase as production increases TneV will increase as production decreases 2 3 4
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