Question : 81. Which of the following statements correct using the direct costing : 1246851

 

81. Which of the following statements is correct using the direct costing concept? A. All manufacturing costs are included in the calculation of cost of goods manufacturedB. Only fixed costs are included in the calculation of cost of goods manufactured while variable costs are considered period costs.C. Only variable manufacturing costs are included in the calculation of cost of goods manufactured while fixed costs are considered period costs.D. All manufacturing costs are considered period costs.

82. The amount of income under absorption costing will be more than the amount of income under variable costing when units manufactured: A. exceed units soldB. equal units soldC. are less than units soldD. are equal to or greater than units sold

83. The level of inventory of a manufactured product has increased by 7,000 units during a period. The following data are also available: 

 

Variable

Fixed

Unit manufacturing costs of the period

$12.00

$6.00

Unit operating expenses of the period

  4.00

 1.50

 

 

 

What would be the effect on income from operations if absorption costing is used rather than variable costing? A. $42,000 decreaseB. $42,000 increaseC. $52,500 increaseD. $59,500 increase

 

84. The level of inventory of a manufactured product has increased by 8,000 units during a period. The following data are also available: 

 

Variable

Fixed

Unit manufacturing costs of the period

$24

$10

Unit operating expenses of the period

  8

  3

 

 

 

What would be the effect on income from operations if variable costing is used rather than absorption costing? A. $80,000 decreaseB. $80,000 increaseC. $88,000 increaseD. $104,000 increase

 

85. The level of inventory of a manufactured product has increased by 10,000 units during a period. The following data are also available: 

 

Variable

Fixed

Unit manufacturing costs of the period

$11.00

$7.00

Unit operating expenses of the period

  3.00

 2.50

 

 

 

What would be the effect on income from operations if variable costing is used rather than absorption costing? A. $70,000 decreaseB. $70,000 increaseC. $45,000 increaseD. $95,000 increase

 

86. The level of inventory of a manufactured product has increased by 8,000 units during a period. The following data are also available: 

 

Variable

Fixed

Unit manufacturing costs of the period

$24

$10

Unit operating expenses of the period

  8

  3

 

 

 

What would be the effect on income from operations if absorption costing is used rather than variable costing? A. $80,000 decreaseB. $80,000 increaseC. $88,000 increaseD. $104,000 increase

 

87. The level of inventory of a manufactured product has increased by 5,000 units during a period. The following data are also available: 

 

Variable

Fixed

Unit manufacturing costs of the period

$24

$10

Unit operating expenses of the period

  8

  3

 

 

 

What would be the effect on income from operations if variable costing is used rather than absorption costing? A. $50,000 decreaseB. $50,000 increaseC. $88,000 increaseD. $104,000 increase

 

88. The level of inventory of a manufactured product has increased by 4,000 units during a period. The following data are also available: 

 

Variable

Fixed

Unit manufacturing costs of the period

$22

$11

Unit operating expenses of the period

  7

  5

 

 

 

What would be the effect on income from operations if absorption costing is used rather than variable costing? A. $44,000 decreaseB. $44,000 increaseC. $64,000 increaseD. $52,000 increase

 

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

Production costs (20,000 units):

 

 

  Direct materials

$180,000

 

  Direct labor

240,000

 

  Variable factory overhead

280,000

 

  Fixed factory overhead

 100,000

$800,000

 

 

 

Operating expenses:

 

 

  Variable operating expenses

$130,000

 

  Fixed operating expenses

  50,000

180,000

 

 

 

If 1,600 units remain unsold at the end of the month, what is the amount of inventory that would be reported on the variable costing balance sheet? A. $64,000B. $56,000C. $66,400D. $68,000

 

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

Production costs (10,000 units):

 

 

  Direct materials

$ 80,000

 

  Direct labor

120,000

 

  Variable factory overhead

140,000

 

  Fixed factory overhead

  40,000

$380,000

Operating expenses:

 

 

  Variable operating expenses

$ 65,000

 

  Fixed operating expenses

  25,000

90,000

 

 

 

If 1,000 units remain unsold at the end of the month, what is the amount of inventory that would be reported on the absorption costing balance sheet? A. $38,000B. $28,000C. $34,000D. $47,000

 

 

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