Question : 96. A business operated at 100% of capacity during its first : 1226952

 

 

96. A business operated at 100% of capacity during its first month and incurred the following costs: 

Production costs (5,000 units):

 

 

  Direct materials

$70,000

 

  Direct labor

20,000

 

  Variable factory overhead

10,000

 

  Fixed factory overhead

    2,000

$102,000

 

 

 

Operating expenses:

 

 

  Variable operating expenses

$17,000

 

  Fixed operating expenses

    1,000

18,000

 

 

 

If 1,000 units remain unsold at the end of the month and sales total $150,000 for the month, what would be the amount of income from operations reported on the absorption costing income statement? A. $50,400B. $70,000C. $52,000D. $68,400

 

97. A business operated at 100% of capacity during its first month and incurred the following costs: 

Production costs (10,000 units):

 

 

  Direct materials

$140,000

 

  Direct labor

40,000

 

  Variable factory overhead

20,000

 

  Fixed factory overhead

     4,000

$204,000

 

 

 

Operating expenses:

 

 

  Variable operating expenses

$ 34,000

 

  Fixed operating expenses

     2,000

36,000

 

 

 

If 2,000 units remain unsold at the end of the month and sales total $300,000 for the month, what is the amount of the manufacturing margin that would be reported on the variable costing income statement? A. $104,000B. $106,000C. $140,000D. $114,800

 

98. A business operated at 100% of capacity during its first month and incurred the following costs: 

Production costs (5,000 units):

 

 

  Direct materials

$70,000

 

  Direct labor

20,000

 

  Variable factory overhead

10,000

 

  Fixed factory overhead

   2,000

$102,000

 

 

 

Operating expenses:

 

 

  Variable operating expenses

$17,000

 

  Fixed operating expenses

    1,000

18,000

 

 

 

If 1,000 units remain unsold at the end of the month and sales total $150,000 for the month, what is the amount of the manufacturing margin that would be reported on the absorption costing income statement? A. $50,000B. $54,000C. not reportedD. $70,000

 

99. A business operated at 100% of capacity during its first month and incurred the following costs: 

Production costs (5,000 units):

 

 

  Direct materials

$70,000

 

  Direct labor

20,000

 

  Variable factory overhead

10,000

 

  Fixed factory overhead

    2,000

$102,000

 

 

 

Operating expenses:

 

 

  Variable operating expenses

$17,000

 

  Fixed operating expenses

    1,000

18,000

 

 

 

If 1,000 units remain unsold at the end of the month and sales total $150,000 for the month, what is the amount of the contribution margin that would be reported on the variable costing income statement? A. $51,400B. $52,000C. $54,000D. $53,000

 

100. A business operated at 100% of capacity during its first month, with the following results: 

Sales (160 units)

 

$160,000

Production costs (200 units):

 

 

  Direct materials

$100,000

 

  Direct labor

20,000

 

  Variable factory overhead

10,000

 

  Fixed factory overhead

     4,000

134,000

 

 

 

Operating expenses:

 

 

  Variable operating expenses

$ 12,000

 

  Fixed operating expenses

     2,000

14,000

 

 

 

What is the amount of the manufacturing margin that would be reported on the variable costing income statement? A. $30,000B. $38,000C. $56,000D. $44,000

 

101. A business operated at 100% of capacity during its first month, with the following results: 

Sales (90 units)

 

$90,000

Production costs (100 units):

 

 

  Direct materials

$40,000

 

  Direct labor

20,000

 

  Variable factory overhead

2,000

 

  Fixed factory overhead

    5,000

67,000

 

 

 

Operating expenses:

 

 

  Variable operating expenses

$ 8,000

 

  Fixed operating expenses

    1,000

9,000

 

 

 

What is the amount of the contribution margin that would be reported on the variable costing income statement? A. $34,200B. $20,200C. $29,700D. $26,200

 

102. A business operated at 100% of capacity during its first month, with the following results: 

Sales (90 units)

 

$90,000

Production costs (100 units):

 

 

  Direct materials

$40,000

 

  Direct labor

20,000

 

  Variable factory overhead

2,000

 

  Fixed factory overhead

    5,000

67,000

 

 

 

Operating expenses:

 

 

  Variable operating expenses

$ 8,000

 

  Fixed operating expenses

    1,000

9,000

 

 

 

What is the amount of the income from operations that would be reported on the variable costing income statement? A. $20,700B. $20,200C. $22,000D. $26,200

 

103. A business operated at 100% of capacity during its first month, with the following results: 

Sales (90 units)

 

$90,000

Production costs (100 units):

 

 

  Direct materials

$40,000

 

  Direct labor

20,000

 

  Variable factory overhead

2,000

 

  Fixed factory overhead

    5,000

67,000

 

 

 

Operating expenses:

 

 

  Variable operating expenses

$ 8,000

 

  Fixed operating expenses

    1,000

9,000

 

 

 

What is the amount of the income from operations that would be reported on the absorption costing income statement? A. $21,000B. $20,700C. $22,200D. $29,700

 

104. A business operated at 100% of capacity during its first month, with the following results: 

Sales (90 units)

 

$90,000

Production costs (100 units):

 

 

  Direct materials

$40,000

 

  Direct labor

20,000

 

  Variable factory overhead

2,000

 

  Fixed factory overhead

    5,000

67,000

 

 

 

Operating expenses:

 

 

  Variable operating expenses

$ 8,000

 

  Fixed operating expenses

    1,000

9,000

 

 

 

What is the amount of the gross profit that would be reported on the absorption costing income statement? A. $26,200B. $20,700C. $29,700D. $22,000

 

105. Accountants prefer the variable costing method over absorption costing method for evaluating the performance of a company because A. by using the absorption costing method, income could appear to be higher by producing more inventory.B. by using the absorption method, more sales will be generated. C. by using the variable costing method, the cost of goods sold will be higher as more units are manufactured and sales remain the same.D. by using the variable costing method, all fixed and variable costs are included in the unit cost of the product manufactured.

 

 

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