$1.(1$ point$)$ Yardly Inc. uses the FIFO method for process costing. The company's only

processing department began May with $4,700$ units of product in process $(65\%$ of the

conversion process completed$).$ During May, Yardly started $15,600$ units of new

product, of which $3,400$ units remained in ending inventory $(55\%$ of the conversion

process completed$).$ If materials are added when the units are $60\%$ complete with

respect to conversion, how many equivalent whole units with respect to materials

would Yardly Inc. have in May?

a$.17,060$

b$.15,600$

c$.12,200$

d$.16,900$

e$.15,715$

f$.20,300$

g$.23,700$

h$.$ None of the above

$2.(1$ point$)$ At the end of the accounting period Tubman, Inc. reports operating income of

$$50,000,$ a contribution margin of $$15,$ and a fixed overhead rate of $$6$ per unit. Under

variable costing, if this company produces $100$ more units of inventory, then operating

income:

a$.$ will increase by $$1,500$

b$.$ will decrease by $$1,500$

c$.$ will increase by $$900$

d$.$ will decrease by $$900$

e$.$ will increase by $$600$

f$.$ will decrease by $$600$

g$.$ will not be affected

h$.$ Cannot be determined

Use the following information to answer the next $2$ questions

Grant Company produces and sells a specialized product for $$40$ per unit. In the first

month of operation, $3,200$ units were produced and $2,050$ units were sold. The company

did not have any material or work in process inventory at the end of the month. Actual

fixed costs are the same as the amount budgeted for the month. Fixed manufacturing cost

is allocated to products based on units produced. Other information for the month

includes:

Variable manufacturing costs $$14$ per unit

Variable marketing costs $ $4$ per unit

Fixed manufacturing costs $$18,560$ per month

Administrative expenses, all fixed $$8,000$ per month

$3.(1$ point$)$ What is operating income under variable costing?

a$.$ $$25,210$

b$.$ $$18,540$

c$.$ $$26,540$

d$.$ $$48,440$

e$.$ $$33,410$

f$.$ $$37,100$

g$.$ $$45,100$

h$.$ None of the above

$4.(1$ point$)$ What is operating income under absorption costing?

a$.$ $$18,540$

b$.$ $$43,840$

c$.$ $$48,440$

d$.$ $$25,210$

e$.$ $$33,410$

f$.$ $$37,100$

g$.$ $$41,410$

h$.$ None of the above

Use the following information to answer the next $3$ questions:

Cracked Inc. manufactures a single product and uses the FIFO method of process costing.

Direct materials are added at the beginning of the production process. Conversion costs

are incurred evenly throughout production. Inspection takes place at the end of the

production process. After inspection, some units are spoiled due to defects. Spoiled units

generally constitute $2\%$ of the good units transferred out $($this is normal spoilage$).$

Assume all spoilage is from the current month$$s production. Data provided for September

is as follows:

Units:

WIP, beginning inventory $(40\%$ complete$)12,500$

WIP, ending inventory $(20\%$ complete$)5,700$

Started in September $54,000$

Good units completed and transferred out $58,500$

Costs:

WIP, beginning inventory:

Direct material cost $ $66,415$

Conversion costs $ $37,622$

Costs added:

Direct material costs added $$160,920$

Conversion costs added $$119,574$

$5.(1$ point$)$ How many units will be included in abnormal spoilage for September?

a$.1,130$ units

b$.970$ units

c$.1,220$ units

d$.1,084$ units

e$.1,380$ units

f$.1,170$ units

g$.1,280$ units

h$.$ None of the above

$6.(2$ points$)$ What cost would be associated with normal spoilage and abnormal spoilage

respectively, in September? $($Round the cost per equivalent unit to the nearest

penny.$)$

a$.$ $$6,756\mathrm{.}40$; $$4,927\mathrm{.}60$

b$.$ $$5,486\mathrm{.}40$; $$6,197\mathrm{.}60$

c$.$ $$6,177\mathrm{.}28$; $$5,506\mathrm{.}72$

d$.$ $$4,673\mathrm{.}60$; $$7,010\mathrm{.}40$

e$.$ $$6,969\mathrm{.}04$; $$6,730\mathrm{.}78$

f$.$ $$3,486\mathrm{.}60$; $$2,457\mathrm{.}00$

g$.$ $$5,943\mathrm{.}60$; $$5,740\mathrm{.}40$

h$.$ None of the above

$7.(2$ points$)$ What costs are allocated to the good units transferred out during September?

$($Round the cost per equivalent unit to the nearest penny.$)$

a$.$ $$294,430\mathrm{.}00$

b$.$ $$255,373\mathrm{.}60$

c$.$ $$353,467\mathrm{.}00$

d$.$ $$355,421\mathrm{.}18$

e$.$ $$359,410\mathrm{.}60$

f$.$ $$365,151\mathrm{.}00$

g$.$ $$348,452\mathrm{.}14$

h$.$ None of the above

$8.(1$ point$)$ Scenic Company had $11,500$ units in its ending inventory on December $31,2023.$ During $2023,$ the company$$s variable production costs were $$8$ per unit and fixed manufacturing overhead rate was $$5$ per unit. If the company$$s operating

income for $2023$ was $$13,000$ lower under variable costing than it was under

absorption costing, how many units were in beginning inventory on January $1,2023?$

$($Assume the company uses normal costing$)$

a$.14,100$ units

b$.13,125$ units

c$.9,875$ units

d$.14,000$ units

e$.10,500$ units

f$.8,900$ units

g$.12,500$ units

h$.$ None of the above