5) Product costs used for pricing and product-mix decisions generally include: A) manufacturing costs only B) design costs plus manufacturing costs C) all costs incurred along the value chain D) distribution costs only 6) Product costs used for government contracts generally include: A) manufacturing costs only B) design costs plus manufacturing costs C) all costs incurred along the value chain D) distribution costs only 7) Product costs used for external reporting generally include: A) manufacturing costs only B) design costs plus manufacturing costs C) all costs incurred along the value chain D) All of these answers are correct. 8) Inventoriable […]

11) Managers apply two criteria to obtain accurate and useful cost functions.  These criteria are ________. A) plausibility and believability B) plausibility and reliability C) reliability and validity D) believability and plausibility 12) In relation to a cost function, the term reliability means ________. A) whether the costs and activities can be easily observed B) whether the cost function conforms to a given mathematical model C) how well the cost function predicts future costs D) how well the cost function explains past cost behavior 13) A cost function is an algebraic equation used to describe the relationship between a cost […]

41) If the selling price per unit of a product is $50, variable costs per unit are $40, and total fixed costs are $50,000, a company must sell 6,000 units to make a target operating income of $10,000. 42) Gilley, Inc., sells a single product. The company's most recent income statement is given below. Sales (4,000 units)$120,000 Less variable expenses(68,000) Contribution margin52,000 Less fixed expenses(40,000) Net income$ 12,000 Required:   a.Contribution margin per unit is$ ________ per unit b.If sales are doubled to $240,000, total variable costs will equal$ ________ c.If sales are doubled to $240,000, total fixed costs will […]

1) The selling price per unit less the variable cost per unit is the: A) fixed cost per unit B) gross margin C) margin of safety D) contribution margin per unit Answer the following questions using the information below: Sherry's Custom Jewelry sells a single product. 700 units were sold resulting in $7,000 of sales revenue, $2,800 of variable costs, and $1,200 of fixed costs. 2) Breakeven point in units is: A) 200 units B) 300 units C) 500 units D) None of these answers are correct. 3) The number of units that must be sold to achieve $6,000 of […]

21) Work-in-process inventory would normally include: A) direct materials in stock and awaiting use in the manufacturing process B) goods partially worked on but not yet fully completed C) goods fully completed but not yet sold D) products in their original form intended to be sold without changing their basic form 22) Finished goods inventory would normally include: A) direct materials in stock and awaiting use in the manufacturing process B) goods partially worked on but not yet fully completed C) goods fully completed but not yet sold D) products in their original form intended to be sold without changing […]