FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 5: Variable Costing for Management Analysis

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 41

Multiple Choice

Review LaterAdd Note

Review Later

For a supervisor of a manufacturing department, which of the following costs is controllable?

A) direct materials
B) insurance on factory building
C) depreciation of factory building
D) rent on factory building

E) A) and C)
F) B) and C)

Correct Answer

verified

Show Answer

Question 42

True/False

Review LaterAdd Note

Review Later

In contribution margin analysis, the effect of a difference in unit sales price or unit cost on the number of units sold is termed the unit price or unit cost factor.

A) True
B) False

Correct Answer

verified

Show Answer

Question 43

True/False

Review LaterAdd Note

In the absorption costing income statement, deduction of the cost of goods sold from sales yields contribution margin.

Management may use both absorption and variable costing methods for analyzing a particular product.

Which of the following would be included in the cost of a product manufactured according to absorption costing?

For a period during which the quantity of product manufactured equals the quantity sold, income from operations reported under absorption costing will equal the income from operations reported under variable costing.

For a period during which the quantity of product manufactured was less than the quantity sold, income from operations reported under absorption costing will be smaller than income from operations reported under variable costing.

Under absorption costing, which of the following costs would not be included in finished goods inventory?

In evaluating the performance of salespersons, the salesperson with the highest level of sales should be evaluated as the best performer.

For a period during which the quantity of product manufactured was less than the quantity sold, income from operations reported under absorption costing will be larger than income from operations reported under variable costing.

Variable costs are $80 per unit, and fixed costs are $40,000. Sales are estimated to be 4,000 units. (a) How much would absorption costing income from operations differ between a plan to produce 4,000 units and a plan to produce 5,000 units? (b) How much would variable costing income from operations differ between the two production plans?

For a period during which the quantity of inventory at the end was smaller than that at the beginning, income from operations reported under variable costing will be larger than income from operations reported under absorption costing.

Philadelphia Company has the following information for March:

In the short run, the selling price of a product should normally not be less than the variable costs and expenses of making and selling it.

Which of the following is(are) reason(s) for easy identification and control of variable manufacturing costs under the variable costing method?

A business operated at 100% of capacity during its first month, with the following results: What is the amount of the income from operations that would be reported on the absorption costing income statement?

A business operated at 100% of capacity during its first month and incurred the following costs: If 2,000 units remain unsold at the end of the month and sales total $300,000 for the month, what would be the amount of income from operations reported on the variable costing income statement?

If the ability to sell and the amount of production facilities devoted to each of two products is equal, it is profitable to increase the sales of that product with the lowest contribution margin.

In contribution margin analysis, the unit price or unit cost factor is computed as:

Cades Company has the following information for March: