10 MANGO Inc adds direct materials at the beginnin g of the

10) MANGO Inc. adds direct materials at the beginnin g of the process and adds conversion costs throughout the process. The data that represents the Shaping Department is listed below 12,000 units Transferred-in costs in WIP. April 1 Direct materials (100%) in wil, April 1 $24,420 523,400 47,000 $550,900 42,000 Conversion costs (75%) in wil. April Units transferred in Transferred-in costs during April irect cost April conversion costs WIP, April 30 100% for materials and 60% for conversion costs) Which of the following is the total number of physical units? A) 42,000 B) 59,000 C) 64,000 D) 54,000 11) Total costs for Frost Corporation at 140,000 units are $339,000, while total fixed costs are $165,000 The total variable costs at a level of 300,000 units would be A) $158,200 B) $353,571 C) $372,857 D) $726,429 12) Lakeview Ltd. has a relevant range of 150,000 units to 400,000 units. The company has total fixed costs of S525,000. Total fixed and variable costs are $612.500 at a production level of 175,000 units. The variable cost per unit at 300,000 units is A) less than at 175,000 units. C) the same as at 175,000 units. B) greater than at 175,000 units. D) dependent upon fixed costs per unit. 13) Stempel Corporation produces frisbees. Total manufacturing costs are $360,000 when 50,000 frisbees are produced. Of this amount, total variable costs are $140,000. What are the total production costs when 85,000 frisbees are produced? (Assume the same relevant range for both production levels.) A) $612,000 B) $458,000 C) $598,000 D) $238,000 14) Which step is performed first when using the high-low method? A) Find the slope C) Find the vertical intercept B) Write the cost equation D) Predict total cost 15) Which of the following is a characteristic of a variable cost? A) Variable costs fluctuate in total with production and sales. B) Variable costs do not change in total over any range. C) Variable costs are fixed in total. D) All of the above may be characteristic of a variable cost. 16) Within the relevant range, which of the following statements is true with respect to fixed costs per unit? A) They will remain the same as production levels change. B) They will increase as production increases. C) They will decrease as production decreases. D) They will increase as production decreases.

Solution

Ans 10 Total no Of physical units Units transferred in+ Units in Beginning WIP 47000+12000 59000 Option B 59000 ans 11 Total cost $339,000 Less: fixed cost 165000 Variable cost A $174,000 No. of units B 140000 Variable cost per unit A/B $1.243 At 300000 units variable cost is $372,857 300000*1.243 option C $372857 ans 12 Variable cost per unit always remain same whether there is increase or decrease in level of activity. Option c the same as at 175000 units ans 14 B) write the cost equation y=a+bx ans 15 A) Variable cost fluctuate in total with production and sales Variable cost per unit always remain same whether there is increase or decrease in level of activity. But total variable cost increases with incraese in activity and vice versa ans 16 D) They will increase as production decraeses When production decreases fixed cost per unit is increased as it is spread to less units If satisfied you can rate