Question

# 1: An income statement for Sam's Bookstore for the first quarter of the year is presented...

1:

An income statement for Sam's Bookstore for the first quarter of the year is presented below:

Sales Cost of goods sold Sam's Bookstore Income Statement For Quarter Ended March 31 \$ 840,000 545,000 295,000 \$ 116,000 136,000 252,000 \$ 43,000

On average, a book sells for \$60. Variable selling expenses are \$4 per book with the remaining selling expenses being fixed. The variable administrative expenses are 3% of sales with the remainder being fixed.

The contribution margin for Sam's Bookstore for the first quarter is:

Garrison 17e Rechecks 2020-09-09

Multiple Choice

• \$758,800

• \$239,000

• \$626,200

• \$213,800

_______________________

2:

At an activity level of 8,400 units in a month, Braughton Corporationâ€™s total variable maintenance and repair cost is \$697,284 and its total fixed maintenance and repair cost is \$464,100. What would be the total maintenance and repair cost, both fixed and variable, at an activity level of 8,500 units in a month? Assume that this level of activity is within the relevant range. (Round intermediate calculations to 2 decimal places.)

Multiple Choice

• \$1,169,685

• \$1,168,297

• \$1,161,384

• \$1,175,210

______________________________-

3:

Carroll Corporation has two products, Q and P. During June, the company's net operating income was \$21,500, and the common fixed expenses were \$47,000. The contribution margin ratio for Product Q was 40%, its sales were \$132,000, and its segment margin was \$39,000. If the contribution margin for Product P was \$37,000, the segment margin for Product P was:

Multiple Choice

• \$29,500

• \$68,500

• \$39,000

• \$8,000

________________________________

4:

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

Selling price \$ 138 0 2,600 2,310 290
 \$ 49 \$ 27 \$ 6 \$ 6 \$36,400 \$13,860

The total gross margin for the month under the absorption costing approach is:

Multiple Choice

• \$97,020

• \$83,160

• \$166,320

• \$83,160

________________________

5:

Dake Corporation's relevant range of activity is 3,000 units to 7,000 units. When it produces and sells 5,000 units, its average costs per unit are as follows:

Average Cost per Unit
Direct materials \$ 7.05
Direct labor \$ 3.20
Fixed selling expense \$ 1.10
Sales commissions \$ 0.90

If 4,000 units are produced, the total amount of direct manufacturing cost incurred is closest to:

Multiple Choice

• \$41,000

• \$52,200

• \$61,400

• \$48,200

_________________________

6:

Krepps Corporation produces a single product. Last year, Krepps manufactured 33,930 units and sold 28,300 units. Production costs for the year were as follows:

Direct materials \$288,405 \$145,899 \$288,405 \$542,880

Sales totaled \$1,287,650 for the year, variable selling and administrative expenses totaled \$164,140, and fixed selling and administrative expenses totaled \$206,973. 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:

Multiple Choice

• \$271,499

• \$209,999

• \$279,999

• \$237,499

1...

Total Contribution Margin
Sales revenue 840000
Less: variable cost
Cost of good sold 545000
Selling expenses (14000*4) 56000
Contribution margin 213800

Option 4 is correct
Note : Number of units sold = Total sales/ Selling pricce = 840000 /60 = 14000 unit

2...

Unit variable cost = 697284/8400= \$83.01
Total maintenance and repair cost=(8500*83.01)+464100= \$1169685
Option 1 is correct

3...

Contribution = Operating profit + Fixed expense

= 21500 + 47000 = 68500

Contribution = Segment P + Segment Q

68500 = Segment P margin + 39000

Segment P margin = \$29500
Option 1 is correct

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