Question 1

Would the following costs be classified as product or period costs under variable costing at a retail clothing store?

Accepted Answer

A)  Option A
B)  Option B
C)  Option C
D)  Option DE) None of the above
F) A) and C) D

Question 2

Maga Company, which has only one product, has provided the following data concerning its most recent month of operations:  Required:
a. What is the unit product cost for the month under variable costing?
b. What is the unit product cost for the month under absorption costing?
c. Prepare a contribution format income statement for the month using variable costing.
d. Prepare an income statement for the month using absorption costing.
e. Reconcile the variable costing and absorption costing net operating incomes for the month.

Accepted Answer

a. & b. Unit product...

Question 3

During April, Division D of Carney Company had a segment margin ratio of 15%, a variable expense ratio of 60% of sales, and traceable fixed expenses of $15,000. Division D's sales were closest to:

Accepted Answer

A)  $100,000
B)  $60,000
C)  $33,333
D)  $22,500E) C) and D)
F) A) and D)

Question 4

What is the net operating income for the month under absorption costing?

Accepted Answer

A)  $1,400
B)  $(19,000) 
C)  $8,800
D)  $10,200E) A) and B)
F) None of the above

Question 5

What is the unit product cost for the month under absorption costing?

Accepted Answer

A)  $83
B)  $92
C)  $86
D)  $77E) All of the above
F) C) and D)

Question 6

The contribution margin of the Commercial business segment is:

Accepted Answer

A)  $769,000
B)  $272,000
C)  $313,000
D)  $86,000E) A) and C)
F) All of the above

Question 7

What is the unit product cost for the month under variable costing?

Accepted Answer

A)  $62
B)  $58
C)  $91
D)  $87E) All of the above
F) B) and C)

Question 8

What was the absorption costing net operating income last year?

Accepted Answer

A)  $60,000
B)  $23,000
C)  $97,000
D)  $89,000E) B) and C)
F) A) and D)

Question 9

What is the total period cost for the month under the variable costing approach?

Accepted Answer

A)  $31,200
B)  $104,400
C)  $117,400
D)  $135,600E) A) and C)
F) B) and C)

Question 10

Gore Corporation has two divisions: the Business Products Division and the Export Products Division. The Business Products Division's divisional segment margin is $55,700 and the Export Products Division's divisional segment margin is $70,600. The total amount of common fixed expenses not traceable to the individual divisions is $107,400. What is the company's net operating income?

Accepted Answer

A)  $233,700
B)  $(126,300) 
C)  $126,300
D)  $18,900E) C) and D)
F) B) and D)

Question 11

All other things equal, if a division's traceable fixed expenses decrease:

Accepted Answer

A)  the division's segment margin will increase.
B)  the overall company net operating income will decrease.
C)  the division's contribution margin will increase.
D)  the division's sales volume will increase.E) B) and C)
F) A) and C)

Question 12

Only those costs that would disappear over time if a segment were eliminated should be considered traceable costs of the segment.

Accepted Answer

A) True 
 B)False  True

Question 13

Carvey Corporation manufactures a variety of products. The following data pertain to the company's operations over the last two years:  Required:
a. Determine the absorption costing net operating income for last year. Show your work!
b. Determine the absorption costing net operating income for this year. Show your work!

Accepted Answer

The answer of Carvey Corporation manufactures a variety of products....

Question 14

Hansen Company produces a single product. During the last year, Hansen had net operating income under absorption costing that was $5,500 lower than its income under variable costing. The company sold 9,000 units during the year, and its variable costs were $10 per unit, of which $6 was variable selling expense. If fixed production cost is $5 per unit under absorption costing every year, then how many units did the company produce during the year?

Accepted Answer

A)  7,625 units
B)  8,450 units
C)  10,100 units
D)  7,900 unitsE) C) and D)
F) B) and C)

Question 15

Data for May concerning Dorow Corporation's two major business segments-Fibers and Feedstocks-appear below:  Common fixed expenses totaled $345,000 and were allocated as follows: $186,000 to the Fibers business segment and $159,000 to the Feedstocks business segment.
Required:
Prepare a segmented income statement in the contribution format for the company. Omit percentages; show only dollar amounts.

Accepted Answer

The answer of Data for May concerning Dorow Corporation's two...

Question 16

The product line segment margin for Product A for June was:

Accepted Answer

A)  $200,000
B)  $80,000
C)  $65,000
D)  $10,000E) None of the above
F) C) and D)

Question 17

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?

Accepted Answer

A)  $21,600
B)  $(15,200) 
C)  $8,000
D)  $13,600E) All of the above
F) A) and B)

Question 18

A segment is any portion or activity of an organization about which a manager seeks revenue, cost, or profit data.

Accepted Answer

A) True 
 B)False

Question 19

What is the unit product cost for the month under absorption costing?

Accepted Answer

A)  $88
B)  $99
C)  $81
D)  $106E) C) and D)
F) All of the above B

Question 20

What is the net operating income for the month under variable costing?

Accepted Answer

A)  $11,400
B)  $16,800
C)  $5,400
D)  $(12,900) E) A) and B)
F) A) and C)

Exam 4: Variable Costing and Segment Reporting: Tools for Management

Would the following costs be classified as product or period costs under variable costing at a retail clothing store?

Correct Answer
verified
D

Correct Answer
verified
a. & b. Unit product...
View Answer

During April, Division D of Carney Company had a segment margin ratio of 15%, a variable expense ratio of 60% of sales, and traceable fixed expenses of $15,000. Division D's sales were closest to:

Correct Answer
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What is the net operating income for the month under absorption costing?

Correct Answer
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What is the unit product cost for the month under absorption costing?

Correct Answer
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The contribution margin of the Commercial business segment is:

Correct Answer
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What is the unit product cost for the month under variable costing?

Correct Answer
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What was the absorption costing net operating income last year?

Correct Answer
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What is the total period cost for the month under the variable costing approach?

Correct Answer
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Correct Answer
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All other things equal, if a division's traceable fixed expenses decrease:

Correct Answer
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Only those costs that would disappear over time if a segment were eliminated should be considered traceable costs of the segment.

Correct Answer
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True

Correct Answer
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Correct Answer
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Correct Answer
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The product line segment margin for Product A for June was:

Correct Answer
verified

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?

Correct Answer
verified

A segment is any portion or activity of an organization about which a manager seeks revenue, cost, or profit data.

Correct Answer
verified

What is the unit product cost for the month under absorption costing?

Correct Answer
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B

What is the net operating income for the month under variable costing?

Correct Answer
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Exam 4: Variable Costing and Segment Reporting: Tools for Management

Would the following costs be classified as product or period costs under variable costing at a retail clothing store?

Correct AnswerverifiedD

Correct Answerverifieda. & b. Unit product...View AnswerShow Answer

During April, Division D of Carney Company had a segment margin ratio of 15%, a variable expense ratio of 60% of sales, and traceable fixed expenses of $15,000. Division D's sales were closest to:

Correct AnswerverifiedShow Answer

What is the net operating income for the month under absorption costing?

Correct AnswerverifiedShow Answer

What is the unit product cost for the month under absorption costing?

Correct AnswerverifiedShow Answer

The contribution margin of the Commercial business segment is:

Correct AnswerverifiedShow Answer

What is the unit product cost for the month under variable costing?

Correct AnswerverifiedShow Answer

What was the absorption costing net operating income last year?

Correct AnswerverifiedShow Answer

What is the total period cost for the month under the variable costing approach?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

All other things equal, if a division's traceable fixed expenses decrease:

Correct AnswerverifiedShow Answer

Only those costs that would disappear over time if a segment were eliminated should be considered traceable costs of the segment.

Correct AnswerverifiedTrue

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The product line segment margin for Product A for June was:

Correct AnswerverifiedShow Answer

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?

Correct AnswerverifiedShow Answer

A segment is any portion or activity of an organization about which a manager seeks revenue, cost, or profit data.

Correct AnswerverifiedShow Answer

What is the unit product cost for the month under absorption costing?

Correct AnswerverifiedB

What is the net operating income for the month under variable costing?

Correct AnswerverifiedShow Answer

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D

Correct Answer
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a. & b. Unit product...
View Answer

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True

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B

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