1.) Sales: 20,000 units

Variable costs per unit: $12

Fixed Costs: $10,500

Selling price: $15

Using the information above, the contribution margin ratio is

Select one:

A.20%

B.15%

C.25%

D.10%

2.) Which of the following is the best example of a mixed cost?

Select one:

A.Salary of a controller

B.Utilities

C.Hourly wage of an administrative assistant

D.Compensation of sales person consisting of a base salary and sales commission.

3.) Consider the following manufacturing costs: Direct labor $4,000; Direct materials $5,000; and Factory overhead $8,000. What is the conversion cost amount?

Select one:

A.$12,000

B.$8,000

C.$9,000

D.$5,000

4.) Contribution margin is:

Select one:

A.Excess of variable costs over sales

B.Excess of direct labor over materials costs

C.Excess of Fixed costs over variable costs

D.Excess of sales over variable cots

5.) The Break-even point is when a company's revenue is:

Select one:

A.Equal to expenses

B.More than expenses

C.Less than expenses

D.None of the above

6.) Consider the following manufacturing costs: Direct labor $4,000; Direct materials $5,000; and Factory overhead $8,000. What is the prime cost amount?

Select one:

A.$8,000

B.$4,000

C.$12,000

D.$9,000

7.) Costs where cost per unit remains the same regardless of changes in the activity base are:

Select one:

A.Fixed Costs

B.Variable costs

C.Mixed costs

D.None of the above

8.) Factory overhead variances only have fixed components.

Select one:

True

False

9.) A decrease in unit selling price decreases the break-even point.

Select one:

True

False

10.) An increase in fixed costs increases the break-even point.

Select one:

True

False

11.) If estimated factory overhead cost is $35,000 and activity base is estimated at 5,000 direct labor hours. What is the predetermined overhead rate?

Select one:

A.$5

B.$4

C.$6

D.$7

12.) The following costs are available for Jetco Manufacturing Co.

Units ProducedTotal

Cost

Jan1,000$45,550

Feb1,500$52,000

Mar1,800$57,500

Using the High-Low method, what is the estimated variable cost for producing 1,000 units? Rounding is fine.

Select one:

A.$14,938

B.$15,935

C.$12,568

D.$15,250

13.) Which of the following is considered a factory overhead cost?

Select one:

A.Direct materials

B.Direct labor

C.Factory power

D.All of the above

14.) A production cost where the cost per unit variesinverselyto the change in the activity base is a:

Select one:

A.Variable cost

B.Fixed cost

C.Mixed cost

D.Conversion cost

15.) Which of the following represents prime costs?

Select one:

A.Direct materials and direct labor

B.Direct materials and indirect labor

C.Direct materials and factory overhead

D.Indirect labor and selling expenses

16.) Direct materials, direct labor, and factory overhead represent which of the following cost?

Select one:

A.Manufacturing costs

B.Period costs

C.All of the above

D.None of the above

17.) The cost of direct materials, direct labor, and factory overhead that have entered the manufacturing process but not yet completed is:

Select one:

A.Materials inventory

B.Finished goods inventory

C.Work in process inventory

D.None of the above

18.) Manufacturing costs consist of Direct materials, direct labor, and selling expenses.

Select one:

True

False

19.) Direct labor and direct materials represent conversion costs.

Select one:

True

False

20.) The formula to calculate the break-even point in units is:

Fixed Cost divided by unit contribution margin ratio.

Select one:

True

False