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Exam 6: Variable Costing and Segment Reporting: Tools for Management

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Question 161

Multiple Choice

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The impact on net operating income of a small change in sales for a segment is best predicted by using:

A) the contribution margin ratio.
B) the segment margin.
C) the ratio of the segment margin to sales.
D) net sales less segment fixed costs.

E) None of the above
F) B) and D)

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Question 162

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Kray Incorporated, which produces a single product, has provided the following data for its most recent month of operations: There were no beginning or ending inventories. The variable costing unit product cost was:

A) $145 per unit
B) $66 per unit
C) $70 per unit
D) $62 per unit

E) A) and D)
F) A) and C)

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Question 163

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Baughn Corporation, which has only one product, has provided the following data concerning its most recent month of operations: What is the unit product cost for the month under absorption costing?

Wyrich Corporation has two divisions: Blue Division and Gold Division. The following report is for the most recent operating period: The company's overall break-even sales is closest to:

Moises Corporation manufactures a single product. Last year, the company's variable costing net operating income was $68,000 and ending inventory decreased by 900 units. Fixed manufacturing overhead cost per unit was $6 in both beginning and ending inventory.Required:Determine the absorption costing net operating income for last year.

Neelon Corporation has two divisions: Southern Division and Northern Division. The following data are for the most recent operating period: The common fixed expenses have been allocated to the divisions on the basis of sales.The Northern Division's break-even sales is closest to:

Sawicki Corporation manufactures and sells one product. The following information pertains to the company's first year of operations: The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 25,000 units and sold 18,000 units. The company's only product is sold for $224 per unit. Required:a. Assume the company uses super-variable costing. Compute the unit product cost for the year and prepare an income statement for the year. b. Assume that the company uses an absorption costing system that assigns $10 of direct labor cost and $62 of fixed manufacturing overhead to each unit that is produced. Compute the unit product cost for the year and prepare an income statement for the year.

Moskowitz Corporation has provided the following data for its two most recent years of operation: The unit product cost under absorption costing in Year 2 is closest to:

Segmented statements for internal use should not be prepared using the contribution format.

Tubaugh Corporation has two major business segments--East and West. In December, the East business segment had sales revenues of $370,000, variable expenses of $200,000, and traceable fixed expenses of $44,000. During the same month, the West business segment had sales revenues of $1,040,000, variable expenses of $532,000, and traceable fixed expenses of $199,000. The common fixed expenses totaled $306,000 and were allocated as follows: $153,000 to the East business segment and $153,000 to the West business segment.The contribution margin of the West business segment is:

Neef Corporation has provided the following data for its two most recent years of operation: Which of the following statements is true for Year 1?

Aaron Corporation, which has only one product, has provided the following data concerning its most recent month of operations: The total contribution margin for the month under variable costing is:

Davison Corporation, which has only one product, has provided the following data concerning its most recent month of operations: What is the total period cost for the month under variable costing?

Leheny Corporation manufactures and sells one product. The following information pertains to the company's first year of operations: The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 55,000 units and sold 50,000 units. The company's only product is sold for $238 per unit.Assume that the company uses a variable costing system that assigns $21 of direct labor cost to each unit that is produced. The net operating income under this costing system is:

Tremble Corporation manufactures and sells one product. The following information pertains to the company's first year of operations: The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 49,000 units and sold 45,000 units. The company's only product is sold for $233 per unit.Assume that the company uses a variable costing system that assigns $11 of direct labor cost to each unit that is produced. The net operating income under this costing system is:

Smidt Corporation has provided the following data for its two most recent years of operation: The unit product cost under variable costing in Year 1 is closest to:

Neef Corporation has provided the following data for its two most recent years of operation: The net operating income (loss) under variable costing in Year 2 is closest to:

A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations: What is the net operating income for the month under variable costing?

Helmers Corporation manufactures a single product. Variable costing net operating income last year was $95,000 and this year was $113,800. Last year, $35,400 in fixed manufacturing overhead costs were released from inventory under absorption costing. This year, $13,300 in fixed manufacturing overhead costs were deferred in inventory under absorption costing.What was the absorption costing net operating income last year?

Janos Corporation, which has only one product, has provided the following data concerning its most recent month of operations: The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month.What is the unit product cost for the month under variable costing?