Multiple choice 150-200

Question 1

151) Croft Corporation produces a single product. Last year, the company had a net operating income of $100,640 using absorption costing and $75,800 using variable costing. The fixed manufacturing overhead cost was $12 per unit. There were no beginning inventories. If 27,900 units were produced last year, then sales last year were:
A) 3,060 units
B) 25,830 units
C) 29,970 units
D) 52,740 units

Answer 1

B) 25,830 units

Question 2

152) Croft Corporation produces a single product. Last year, the company had a net operating income of $160,000 using absorption costing and $149,000 using variable costing. The fixed manufacturing overhead cost was $10 per unit. There were no beginning inventories. If 43,000 units were produced last year, then sales last year were:
A) 32,000 units
B) 40,000 units
C) 41,900 units
D) 54,000 units

Answer 2

C) 41,900 units

Question 3

153) Pungent Corporation manufactures and sells a spice rack. Shown below are the actual operating results for the first two years of operations:

Year 1	Year 2 Units (spice racks) produced	40,000	40,000 Units (spice racks) sold	37,000	41,000 Absorption costing net operating income	$ 44,000	$ 52,000 Variable costing net operating income	$ 38,000	???

Pungent’s selling price and unit variable cost and total fixed cost were the same for both years. What is Pungent’s variable costing net operating income for Year 2?
A) $48,000
B) $50,000
C) $54,000
D) $56,000

Answer 3

C) $54,000

Question 4

154) Last year, Kirsten Corporation’s variable costing net operating income was $63,400. Fixed manufacturing overhead costs released from inventory under absorption costing amounted to $10,700. What was the absorption costing net operating income last year?
A) $10,700
B) $74,100
C) $63,400
D) $52,700

Answer 4

D) $52,700

Question 5

155) Last year, Tinklenberg Corporation’s variable costing net operating income was $52,400 and its inventory decreased by 1,400 units. Fixed manufacturing overhead cost was $8 per unit for both units in beginning and in ending inventory. What was the absorption costing net operating income last year?
A) $41,200
B) $11,200
C) $63,600
D) $52,400

Answer 5

A) $41,200

Question 6

156) Sipho Corporation manufactures a single product. Last year, the company’s variable costing net operating income was $90,900. Fixed manufacturing overhead costs released from inventory under absorption costing amounted to $21,900. What was the absorption costing net operating income last year?
A) $69,000
B) $90,900
C) $21,900
D) $112,800

Answer 6

A) $69,000

Question 7

157) Truo Corporation produces a single product. Last year, the company had net operating income of $100,000 using variable costing. Beginning and ending inventories were 13,000 units and 18,000 units, respectively. If the fixed manufacturing overhead cost was $4 per unit both last year and this year, what would have been the net operating income using absorption costing?
A) $80,000
B) $100,000
C) $120,000
D) $172,000

Answer 7

C) $120,000

Question 8

158) Corbel Corporation has two divisions: Division A and Division B. Last month, the company reported a contribution margin of $44,200 for Division A. Division B had a contribution margin ratio of 30% and its sales were $286,000. Net operating income for the company was $32,400 and traceable fixed expenses were $59,300. Corbel Corporation’s common fixed expenses were:
A) $38,300
B) $59,300
C) $97,600
D) $130,000

Answer 8

A) $38,300

Question 9

159) Corbel Corporation has two divisions: Division A and Division B. Last month, the company reported a contribution margin of $60,000 for Division A. Division B had a contribution margin ratio of 40% and its sales were $300,000. Net operating income for the company was $40,000 and traceable fixed expenses were $80,000. Corbel Corporation’s common fixed expenses were:
A) $140,000
B) $60,000
C) $100,000
D) $80,000

Answer 9

B) $60,000

Question 10

160) Miscavage Corporation has two divisions: the Beta Division and the Alpha Division. The Beta Division has sales of $310,000, variable expenses of $155,100, and traceable fixed expenses of $71,300. The Alpha Division has sales of $620,000, variable expenses of $339,800, and traceable fixed expenses of $133,500. The total amount of common fixed expenses not traceable to the individual divisions is $135,200. What is the company’s net operating income?
A) $230,300
B) $435,100
C) $95,100
D) $280,200

Answer 10

C) $95,100

Question 11

161) Miscavage Corporation has two divisions: the Beta Division and the Alpha Division. The Beta Division has sales of $580,000, variable expenses of $301,600, and traceable fixed expenses of $186,500. The Alpha Division has sales of $510,000, variable expenses of $178,500, and traceable fixed expenses of $222,100. The total amount of common fixed expenses not traceable to the individual divisions is $235,500. What is the company’s net operating income?
A) $374,400
B) $201,300
C) $609,900
D) ($34,200)

Answer 11

D) ($34,200)

Question 12

162) Younie Corporation has two divisions: the South Division and the West Division. The corporation’s net operating income is $98,100. The South Division’s divisional segment margin is $44,400 and the West Division’s divisional segment margin is $171,700. What is the amount of the common fixed expense not traceable to the individual divisions?
A) $269,800
B) $216,100
C) $118,000
D) $142,500

Answer 12

C) $118,000

Question 13

163) Younie Corporation has two divisions: the South Division and the West Division. The corporation’s net operating income is $26,900. The South Division’s divisional segment margin is $42,800 and the West Division’s divisional segment margin is $29,900. What is the amount of the common fixed expense not traceable to the individual divisions?
A) $56,800
B) $69,700
C) $72,700
D) $45,800

Answer 13

D) $45,800

Question 14

164) Carroll Corporation has two products, Q and P. During June, the company’s net operating income was $21,000, and the common fixed expenses were $46,000. The contribution margin ratio for Product Q was 40%, its sales were $131,000, and its segment margin was $38,000. If the contribution margin for Product P was $36,000, the segment margin for Product P was:
A) $29,000
B) $38,000
C) $8,000
D) $67,000

Answer 14

A) $29,000

Question 15

165) Carroll Corporation has two products, Q and P. During June, the company’s net operating income was $25,000, and the common fixed expenses were $37,000. The contribution margin ratio for Product Q was 30%, its sales were $200,000, and its segment margin was $21,000. If the contribution margin for Product P was $80,000, the segment margin for Product P was:
A) $62,000
B) $59,000
C) $37,000
D) $41,000

Answer 15

D) $41,000

Question 16

166) J Corporation has two divisions. Division A has a contribution margin of $79,300 and Division B has a contribution margin of $126,200. If total traceable fixed expenses are $72,400 and total common fixed expenses are $34,900, what is J Corporation’s net operating income?
A) $168,000
B) $170,600
C) $133,100
D) $98,200

Answer 16

D) $98,200

Question 17

167) Uchimura Corporation has two divisions: the AFE Division and the GBI Division. The corporation’s net operating income is $11,700. The AFE Division’s divisional segment margin is $81,100 and the GBI Division’s divisional segment margin is $46,300. What is the amount of the common fixed expense not traceable to the individual divisions?
A) $92,800
B) $115,700
C) $58,000
D) $127,400

Answer 17

B) $115,700

Question 18

168) Uchimura Corporation has two divisions: the AFE Division and the GBI Division. The corporation’s net operating income is $42,000. The AFE Division’s divisional segment margin is $15,700 and the GBI Division’s divisional segment margin is $175,400. What is the amount of the common fixed expense not traceable to the individual divisions?
A) $149,100
B) $57,700
C) $217,400
D) $191,100

Answer 18

A) $149,100

Question 19

169) Chang Corporation has two divisions, T and W. The company’s overall contribution margin ratio is 40%, with sales in the two divisions totaling $900,000. If variable expenses are $200,000 in Division T and if Division W’s contribution margin ratio is 20%, the sales in Division W must be:
A) $200,000
B) $425,000
C) $700,000
D) $340,000

Answer 19

B) $425,000

Question 20

170) Dukelow Corporation has two divisions: the Governmental Products Division and the Export Products Division. The Governmental Products Division’s divisional segment margin is $34,800 and the Export Products Division’s divisional segment margin is $87,200. The total amount of common fixed expenses not traceable to the individual divisions is $96,400. What is the company’s net operating income (loss)?
A) $218,400
B) $122,000
C) $25,600
D) ($122,000)

Answer 20

C) $25,600

Question 21

171) Dukelow Corporation has two divisions: the Governmental Products Division and the Export Products Division. The Governmental Products Division’s divisional segment margin is $255,000 and the Export Products Division’s divisional segment margin is $59,800. The total amount of common fixed expenses not traceable to the individual divisions is $163,700. What is the company’s net operating income?
A) $314,800
B) ($314,800)
C) $151,100
D) $478,500

Answer 21

C) $151,100

Question 22

172) Eyestone Corporation has two divisions, A and B. The following data pertain to operations in October:

Division A	Division B Sales	$ 80,000	$ 170,000 Variable expenses as a percentage of sales	60%	80% Segment margin	$ 10,000	$ 25,000

If common fixed expenses were $17,000, total fixed expenses were:
A) $48,000
B) $13,000
C) $31,000
D) $53,000

Answer 22

A) $48,000

Question 23

173) WV Construction has two divisions: Remodeling and New Home Construction. Each division has an on-site supervisor who is paid a salary of $86,000 annually and one salaried estimator who is paid $48,000 annually. The corporate office has two office administrative assistants who are paid salaries of $52,000 and $38,000 annually. The president’s salary is $156,000. How much of these salaries are common fixed expenses?
A) $156,000
B) $246,000
C) $90,000
D) $318,000

Answer 23

B) $246,000

Question 24

174) WV Construction has two divisions: Remodeling and New Home Construction. Each division has an on-site supervisor who is paid a salary of $58,000 annually and one salaried estimator who is paid $52,000 annually. The corporate office has two office administrative assistants who are paid salaries of $38,000 and $31,000 annually. The president’s salary is $127,000. How much of these salaries are common fixed expenses?
A) $127,000
B) $110,000
C) $196,000
D) $306,000

Answer 24

C) $196,000

Question 25

175) Baughn Corporation, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price $ 115
Units in beginning inventory 0
Units produced 6,600
Units sold 6,400
Units in ending inventory 200
Variable costs per unit:
Direct materials $ 26
Direct labor $ 46
Variable manufacturing overhead $ 7
Variable selling and administrative expense $ 9
Fixed costs:
Fixed manufacturing overhead $ 105,600
Fixed selling and administrative expense $ 51,200

What is the unit product cost for the month under absorption costing?
A) $79 per unit
B) $95 per unit
C) $104 per unit
D) $88 per unit

Answer 25

B) $95 per unit

Question 26

176) Ross Corporation produces a single product. The company has direct materials costs of $8 per unit, direct labor costs of $6 per unit, and manufacturing overhead of $10 per unit. Sixty percent of the manufacturing overhead is for fixed costs. In addition, variable selling and administrative expenses are $2 per unit, and fixed selling and administrative expenses are $3 per unit at the current activity level. Assume that direct labor is a variable cost.

Under absorption costing, the unit product cost is:
A) $24 per unit
B) $20 per unit
C) $26 per unit
D) $29 per unit

Answer 26

A) $24 per unit

Question 27

177) Ross Corporation produces a single product. The company has direct materials costs of $8 per unit, direct labor costs of $6 per unit, and manufacturing overhead of $10 per unit. Sixty percent of the manufacturing overhead is for fixed costs. In addition, variable selling and administrative expenses are $2 per unit, and fixed selling and administrative expenses are $3 per unit at the current activity level. Assume that direct labor is a variable cost.

Under variable costing, the unit product cost is:
A) $24 per unit
B) $20 per unit
C) $18 per unit
D) $21 per unit

Answer 27

C) $18 per unit

Question 28

178) Columbia Corporation produces a single product. The company’s variable costing income statement for November appears below:

Columbia Corporation
Income Statement
For the Month ended November 30
Sales ($22 per unit) $ 952,600
Variable expenses:
Variable cost of goods sold 606,200
Variable selling expense 129,900
Total variable expenses 736,100
Contribution margin 216,500
Fixed expenses:
Manufacturing 107,130
Selling and administrative 35,710
Total fixed expenses 142,840
Net operating income $ 73,660

During November, 35,710 units were manufactured and 8,490 units were in beginning inventory. Variable production costs per unit, total fixed manufacturing expenses, and the number of units produced were the same in prior months.
Under absorption costing, for November the company would report a:
A) $35,710 profit
B) $50,890 profit
C) $73,660 profit
D) $50,890 loss

Answer 28

B) $50,890 profit

Question 29

179) Aaron Corporation, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price $ 147
Units in beginning inventory 0
Units produced 6,900
Units sold 6,600
Units in ending inventory 300
Variable costs per unit:
Direct materials $ 24
Direct labor $ 54
Variable manufacturing overhead $ 18
Variable selling and administrative expense $ 18
Fixed costs:
Fixed manufacturing overhead $ 186,300
Fixed selling and administrative expense $ 27,600

What is the unit product cost for the month under variable costing?
A) $114 per unit
B) $141 per unit
C) $123 per unit
D) $96 per unit

Answer 29

D) $96 per unit

Question 30

180) Aaron Corporation, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price $ 90
Units in beginning inventory 0
Units produced 3,400
Units sold 3,000
Units in ending inventory 400
Variable costs per unit:
Direct materials $ 21
Direct labor $ 38
Variable manufacturing overhead $ 6
Variable selling and administrative expense $ 4
Fixed costs:
Fixed manufacturing overhead $ 5 4,400
Fixed selling and administrative expense $ 3,000

What is the unit product cost for the month under absorption costing?
A) $81 per unit
B) $65 per unit
C) $85 per unit
D) $69 per unit

Answer 30

A) $81 per unit

Question 31

181) Aaron Corporation, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price $ 112
Units in beginning inventory 0
Units produced 5,100
Units sold 4,490
Units in ending inventory 610
Variable costs per unit:
Direct materials $ 21
Direct labor $ 45
Variable manufacturing overhead $ 6
Variable selling and administrative expense $ 4
Fixed costs:
Fixed manufacturing overhead $ 57,700
Fixed selling and administrative expense $ 3,300

The total contribution margin for the month under variable costing is:
A) $100,640
B) $161,640
C) $103,940
D) $179,600

Answer 31

B) $161,640

Question 32

182) Aaron Corporation, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price $ 90
Units in beginning inventory 0
Units produced 3,400
Units sold 3,000
Units in ending inventory 400
Variable costs per unit:
Direct materials $ 21
Direct labor $ 38
Variable manufacturing overhead $ 6
Variable selling and administrative expense $ 4
Fixed costs:
Fixed manufacturing overhead $ 54,400
Fixed selling and administrative expense $ 3,000

The total gross margin for the month under the absorption costing approach is:
A) $12,000
B) $59,400
C) $63,000
D) $27,000

Answer 32

D) $27,000

Question 33

183) Aaron Corporation, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price $ 90
Units in beginning inventory 0
Units produced 3,400
Units sold 3,000
Units in ending inventory 400
Variable costs per unit:
Direct materials $ 21
Direct labor $ 38
Variable manufacturing overhead $ 6
Variable selling and administrative expense $ 4
Fixed costs:
Fixed manufacturing overhead $ 54,400
Fixed selling and administrative expense $ 3,000

What is the total period cost for the month under variable costing?
A) $54,400
B) $69,400
C) $57,400
D) $15,000

Answer 33

B) $69,400

Question 34

184) Aaron Corporation, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price 90
Units in beginning inventory 0
Units produced 3,400
Units sold 3,000
Units in ending inventory 400
Variable costs per unit:
Direct materials $ 21
Direct labor $ 38
Variable manufacturing overhead $ 6
Variable selling and administrative expense $ 4
Fixed costs:
Fixed manufacturing overhead $ 54,400
Fixed selling and administrative expense $ 3,000

What is the net operating income for the month under variable costing?
A) $12,000
B) $(20,400)
C) $5,600
D) $6,400

Answer 34

C) $5,600

Question 35

185) Farris Corporation, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price $ 78
Units in beginning inventory 0
Units produced 8,800
Units sold 8,700
Units in ending inventory 100
Variable costs per unit:
Direct materials $ 18
Direct labor $ 10
Variable manufacturing overhead $ 4
Variable selling and administrative expense $ 5
Fixed costs:
Fixed manufacturing overhead $ 255,200
Fixed selling and administrative expense $ 87,000

What is the net operating income for the month under variable costing?
A) $14,500
B) $17,400
C) $11,300
D) $2,900

Answer 35

A) $14,500

Question 36

186) Janos Corporation, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price $ 111
Units in beginning inventory 300
Units produced 2,000
Units sold 2,200
Units in ending inventory 100
Variable costs per unit:
Direct materials $ 29
Direct labor $ 30
Variable manufacturing overhead $ 4
Variable selling and administrative expense $ 9
Fixed costs:
Fixed manufacturing overhead $34,000
Fixed selling and administrative expense $39,600

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?
A) $63 per unit
B) $80 per unit
C) $72 per unit
D) $89 per unit

Answer 36

A) $63 per unit

Question 37

187) Janos Corporation, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price $ 111
Units in beginning inventory 300
Units produced 2,000
Units sold 2,200
Units in ending inventory 100
Variable costs per unit:
Direct materials $ 29
Direct labor $ 30
Variable manufacturing overhead $ 4
Variable selling and administrative expense $ 9
Fixed costs:
Fixed manufacturing overhead $ 34,000
Fixed selling and administrative expense $ 39,600

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 net operating income for the month under variable costing?
A) $8,800
B) $12,200
C) $1,700
D) $24,800

Answer 37

B) $12,200

Question 38

188) Keyser Corporation, which has only one product, has provided the following data concerning its most recent month of operations:

Selling price $ 118
Units in beginning inventory 400
Units produced 2,100
Units sold 2,300
Units in ending inventory 200
Variable costs per unit:
Direct materials $ 37
Direct labor $ 23
Variable manufacturing overhead $ 3
Variable selling and administrative expense $ 5
Fixed costs:
Fixed manufacturing overhead $ 73,500
Fixed selling and administrative expense $ 29,900

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 net operating income for the month under variable costing?
A) $4,600
B) $11,600
C) $24,200
D) $7,000

Answer 38

B) $11,600

Question 39

189) Bryans Corporation has provided the following data for its two most recent years of operation:

Selling price per unit $ 53
Manufacturing costs:
Variable manufacturing cost per unit produced:
Direct materials $ 13
Direct labor $ 6
Variable manufacturing overhead $ 5
Fixed manufacturing overhead per year $ 63,000
Selling and administrative expenses:
Variable selling and administrative expense per unit sold $ 4
Fixed selling and administrative expense per year $ 71,000
Year 1 Year 2
Units in beginning inventory 0 3,000
Units produced during the year 9,000 7,000
Units sold during the year 6,000 7,000
Units in ending inventory 3,000 3,000

The net operating income (loss) under variable costing in Year 1 is closest to:
A) $174,000
B) $37,000
C) $150,000
D) $16,000

Answer 39

D) $16,000

Question 40

190) Plummer Corporation has provided the following data for its two most recent years of operation:

Selling price per unit $ 44
Manufacturing costs:
Variable manufacturing cost per unit produced:
Direct materials $ 9
Direct labor $ 6
Variable manufacturing overhead $ 4
Fixed manufacturing overhead per year $ 63,000
Selling and administrative expenses:
Variable selling and administrative expense per unit sold $ 5
Fixed selling and administrative expense per year $ 66,000
Year 1 Year 2
Units in beginning inventory 0 2,000
Units produced during the year 9,000 7,000
Units sold during the year 7,000 8,000
Units in ending inventory 2,000 1,000

The unit product cost under absorption costing in Year 2 is closest to:
A) $9.00
B) $19.00
C) $28.00
D) $33.00

Answer 40

C) $28.00

Question 41

191) Plummer Corporation has provided the following data for its two most recent years of operation:

Selling price per unit $ 44
Manufacturing costs:
Variable manufacturing cost per unit produced:
Direct materials $ 9
Direct labor $ 6
Variable manufacturing overhead $ 4
Fixed manufacturing overhead per year $ 63,000
Selling and administrative expenses:
Variable selling and administrative expense per unit sold $ 5
Fixed selling and administrative expense per year $ 66,000
Year 1 Year 2
Units in beginning inventory 0 2,000
Units produced during the year 9,000 7,000
Units sold during the year 7,000 8,000
Units in ending inventory 2,000 1,000

The unit product cost under variable costing in Year 1 is closest to:
A) $19.00
B) $24.00
C) $26.00
D) $31.00

Answer 41

A) $19.00

Question 42

192) The Southern Corporation manufactures a single product and has the following cost structure:

Variable costs per unit:
Production $ 33
Selling and administrative $ 13
Fixed costs per year:
Production $ 217,210
Selling and administrative $ 195,490

Last year, 7,490 units were produced and 7,390 units were sold. There was no beginning inventory.

The carrying value on the balance sheet of the ending inventory of finished goods under variable costing would be:
A) the same as absorption costing.
B) $7,390 greater than under absorption costing.
C) $7,390 less than under absorption costing.
D) $2,900 less than under absorption costing.

Answer 42

D) $2,900 less than under absorption costing.

Question 43

193) Smidt Corporation has provided the following data for its two most recent years of operation:

Manufacturing costs:
Variable manufacturing cost per unit produced:
Direct materials $ 9
Direct labor $ 5
Variable manufacturing overhead $ 5
Fixed manufacturing overhead per year $ 140,000
Selling and administrative expenses:
Variable selling and administrative expense per unit sold $ 5
Fixed selling and administrative expense per year $ 65,000
Year 1 Year 2
Units in beginning inventory 0 3,000
Units produced during the year 10,000 7,000
Units sold during the year 7,000 6,000
Units in ending inventory 3,000 4,000
The unit product cost under absorption costing in Year 1 is closest to:
A) $19.00
B) $14.00
C) $33.00
D) $38.00

Answer 43

C) $33.00

Question 44

194) Smidt Corporation has provided the following data for its two most recent years of operation:

Manufacturing costs:
Variable manufacturing cost per unit produced:
Direct materials $ 9
Direct labor $ 5
Variable manufacturing overhead $ 5
Fixed manufacturing overhead per year $ 140,000
Selling and administrative expenses:
Variable selling and administrative expense per unit sold $ 5
Fixed selling and administrative expense per year $ 65,000
Year 1 Year 2
Units in beginning inventory 0 3,000
Units produced during the year 10,000 7,000
Units sold during the year 7,000 6,000
Units in ending inventory 3,000 4,000

The unit product cost under variable costing in Year 1 is closest to:
A) $24.00
B) $33.00
C) $19.00
D) $38.00

Answer 44

C) $19.00

Question 45

195) Krepps Corporation produces a single product. Last year, Krepps manufactured 20,000 units and sold 15,000 units. Production costs for the year were as follows:

Direct materials $ 170,000
Direct labor $ 110,000
Variable manufacturing overhead $ 200,000
Fixed manufacturing overhead $ 240,000

Sales totaled $825,000 for the year, variable selling and administrative expenses totaled $108,000, and fixed selling and administrative expenses totaled $165,000. There was no beginning inventory. Assume that direct labor is a variable cost.

Under variable costing, the company’s net operating income for the year would be:
A) $101,250 lower than under absorption costing.
B) $60,000 lower than under absorption costing.
C) $101,250 higher than under absorption costing.
D) $60,000 higher than under absorption costing.

Answer 45

B) $60,000 lower than under absorption costing.

Question 46

196) Krepps Corporation produces a single product. Last year, Krepps manufactured 20,000 units and sold 15,000 units. Production costs for the year were as follows:

Direct materials $ 170,000
Direct labor $ 110,000
Variable manufacturing overhead $ 200,000
Fixed manufacturing overhead $ 240,000

Sales totaled $825,000 for the year, variable selling and administrative expenses totaled $108,000, and fixed selling and administrative expenses totaled $165,000. There was no beginning inventory. Assume that direct labor is a variable cost.

Under absorption costing, the ending inventory for the year would be valued at:
A) $0
B) $216,000
C) $248,250
D) $180,000

Answer 46

D) $180,000

Question 47

197) McCoy Corporation manufactures a computer monitor. Shown below is McCoy’s cost structure:

Variable cost per monitor	Total fixed cost for the year Manufacturing cost	$ 75.20	$ 912,000 Selling and administrative	$ 14.60	$ 456,000

In its first year of operations, McCoy produced 100,000 monitors but only sold 95,000. McCoy’s gross margin in this first year was $2,629,600. McCoy’s contribution margin in this first year was $2,109,000.

Under absorption costing, what is McCoy’s net operating income for its first year?
A) $266,000
B) $786,600
C) $1,261,600
D) $2,173,600

Answer 47

B) $786,600

Question 48

198) Helmers Corporation manufactures a single product. Variable costing net operating income last year was $86,000 and this year was $103,000. Last year, $32,000 in fixed manufacturing overhead costs were released from inventory under absorption costing. This year, $12,000 in fixed manufacturing overhead costs were deferred in inventory under absorption costing.

What was the absorption costing net operating income last year?
A) $106,000
B) $86,000
C) $54,000
D) $118,000

Answer 48

C) $54,000

Question 49

199) Helmers Corporation manufactures a single product. Variable costing net operating income last year was $86,000 and this year was $103,000. Last year, $32,000 in fixed manufacturing overhead costs were released from inventory under absorption costing. This year, $12,000 in fixed manufacturing overhead costs were deferred in inventory under absorption costing.

What was the absorption costing net operating income this year?
A) $81,000
B) $83,000
C) $115,000
D) $123,000

Answer 49

C) $115,000

Question 50

200) Tubaugh Corporation has two major business segments–East and West. In December, the East business segment had sales revenues of $240,000, variable expenses of $135,000, and traceable fixed expenses of $31,000. During the same month, the West business segment had sales revenues of $910,000, variable expenses of $480,000, and traceable fixed expenses of $173,000. The common fixed expenses totaled $254,000 and were allocated as follows: $127,000 to the East business segment and $127,000 to the West business segment.

The contribution margin of the West business segment is:
A) $430,000
B) $(49,000)
C) $537,000
D) $74,000

Answer 50

A) $430,000

Question 51

201) Tubaugh Corporation has two major business segments–East and West. In December, the East business segment had sales revenues of $690,000, variable expenses of $352,000, and traceable fixed expenses of $104,000. During the same month, the West business segment had sales revenues of $140,000, variable expenses of $56,000, and traceable fixed expenses of $24,000. The common fixed expenses totaled $162,000 and were allocated as follows: $89,000 to the East business segment and $73,000 to the West business segment.

The contribution margin of the West business segment is:
A) $84,000
B) $234,000
C) $422,000
D) $145,000

Answer 51

A) $84,000

Question 52

202) Tubaugh Corporation has two major business segments–East and West. In December, the East business segment had sales revenues of $410,000, variable expenses of $220,000, and traceable fixed expenses of $48,000. During the same month, the West business segment had sales revenues of $1,080,000, variable expenses of $548,000, and traceable fixed expenses of $207,000. The common fixed expenses totaled $322,000 and were allocated as follows: $161,000 to the East business segment and $161,000 to the West business segment.

A properly constructed segmented income statement in a contribution format would show that the segment margin of the East business segment is:
A) $220,000
B) $142,000
C) $(29,000)
D) $(31,000)

Answer 52

B) $142,000

Question 53

203) Tubaugh Corporation has two major business segments–East and West. In December, the East business segment had sales revenues of $690,000, variable expenses of $352,000, and traceable fixed expenses of $104,000. During the same month, the West business segment had sales revenues of $140,000, variable expenses of $56,000, and traceable fixed expenses of $24,000. The common fixed expenses totaled $162,000 and were allocated as follows: $89,000 to the East business segment and $73,000 to the West business segment.

A properly constructed segmented income statement in a contribution format would show that the segment margin of the East business segment is:
A) $352,000
B) $145,000
C) $234,000
D) $249,000

Answer 53

C) $234,000

Question 54

204) Tubaugh Corporation has two major business segments–East and West. In December, the East business segment had sales revenues of $690,000, variable expenses of $352,000, and traceable fixed expenses of $104,000. During the same month, the West business segment had sales revenues of $140,000, variable expenses of $56,000, and traceable fixed expenses of $24,000. The common fixed expenses totaled $162,000 and were allocated as follows: $89,000 to the East business segment and $73,000 to the West business segment.

A properly constructed segmented income statement in a contribution format would show that the net operating income of the company as a whole is:
A) $294,000
B) $422,000
C) $132,000
D) $(30,000)

Answer 54

C) $132,000

Question 55

205) Ieso Corporation has two stores: J and K. During November, Ieso Corporation reported a net operating income of $30,000 and sales of $450,000. The contribution margin in Store J was $100,000, or 40% of sales. The segment margin in Store K was $30,000, or 15% of sales. Traceable fixed expenses are $60,000 in Store J, and $40,000 in Store K.

Sales in Store J totaled:
A) $400,000
B) $250,000
C) $150,000
D) $100,000

Answer 55

B) $250,000

Question 56

206) Ieso Corporation has two stores: J and K. During November, Ieso Corporation reported a net operating income of $30,000 and sales of $450,000. The contribution margin in Store J was $100,000, or 40% of sales. The segment margin in Store K was $30,000, or 15% of sales. Traceable fixed expenses are $60,000 in Store J, and $40,000 in Store K.

Variable expenses in Store K totaled:
A) $70,000
B) $110,000
C) $200,000
D) $130,000

Answer 56

D) $130,000

Question 57

207) Ieso Corporation has two stores: J and K. During November, Ieso Corporation reported a net operating income of $30,000 and sales of $450,000. The contribution margin in Store J was $100,000, or 40% of sales. The segment margin in Store K was $30,000, or 15% of sales. Traceable fixed expenses are $60,000 in Store J, and $40,000 in Store K.

Ieso Corporation’s total fixed expenses for the year were:
A) $40,000
B) $100,000
C) $140,000
D) $170,000

Answer 57

C) $140,000

Question 58

208) Bertie Corporation has two divisions: Retail Division and Wholesale Division. The following data are for the most recent operating period:

Total Company	Retail Division	Wholesale Division Sales	$ 711,400	$ 438,800	$ 272,600 Variable expenses	$ 192,532	$ 105,300	$ 87,232 Traceable fixed expenses	$ 332,400	$ 253,900	$ 78,500

The common fixed expenses of the company are $94,200.

The Wholesale Division’s break-even sales is closest to:
A) $115,441
B) $283,135
C) $138,529
D) $488,824

Answer 58

A) $115,441