Question

Bellucci Corporation has provided the following information: Cost per Unit Cost per Period Direct materials $...

Bellucci Corporation has provided the following information:

Cost per Unit Cost per Period
Direct materials $ 7.30
Direct labor $ 3.45
Variable manufacturing overhead $ 1.35
Fixed manufacturing overhead $ 103,200
Sales commissions $ 1.10
Variable administrative expense $ 0.65
Fixed selling and administrative expense $ 38,400

The incremental manufacturing cost that the company will incur if it increases production from 8,000 to 8,001 units is closest to (assume that the increase is within the relevant range):

Multiple Choice

  • $28.45

  • $12.10

  • $31.55

  • $25.00

Question 2

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

Sam's Bookstore
Income Statement
For Quarter Ended March 31
Sales $ 950,000
Cost of goods sold 650,000
Gross margin 300,000
Selling and administrative expenses
Selling $ 104,000
Administration 112,000 216,000
Net operating income $ 84,000

On average, a book sells for $50. 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 cost formula for selling and administrative expenses with "X" equal to the number of books sold is:

Multiple Choice

  • Y = $112,500 + $4.00X

  • Y = $112,500 + $5.50X

  • Y = $111,500 + $5.50X

  • Y = $111,500 + $7.00X

Homework Answers

Answer #1

Part 1) OPTION B----$12.10

Calculation of Incremental Manufacturing cost per unit

Direct Material 7.3

Direct Labor 3.45

Variable Mfg O/H 1.35

Total Incremental Manufacturing cost per unit = $12.10

Part 2) OPTION C------- Y = 111500 + $5.50X

No of units sold = 950000/50 = 19000 units

Total Selling expenses = 104000

Variable selling expenses= 19000 *4 = 76000

Fixed Selling expenses= 104000 -76000= 28000

Total administration expenses= 112000

Variable administration expenses= 950000*3% = 28500

Fixed Administration expenses= 112000 -28500= 83500

Total Fixed Selling and Administration expenses= 28000 +83500= 111500

Variable will be =4% selling + 50*3% administration

Variable will be = 5.5% of units sold

Hence, Formula will be Y = 111500 + $5.50X

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Glew Corporation has provided the following information: Cost per Unit Cost per Period Direct materials $...
Glew Corporation has provided the following information: Cost per Unit Cost per Period Direct materials $ 6.00 Direct labor $ 3.35 Variable manufacturing overhead $ 1.75 Fixed manufacturing overhead $ 8,800 Sales commissions $ 1.00 Variable administrative expense $ 0.40 Fixed selling and administrative expense $ 4,000 If 3,000 units are produced, the total amount of direct manufacturing cost incurred is closest to: Multiple Choice $33,300 $31,050 $28,050 $39,900
An income statement for Sam's Bookstore for the first quarter of the year is presented below:...
An income statement for Sam's Bookstore for the first quarter of the year is presented below: Sam's Bookstore Income Statement For Quarter Ended March 31 Sales $ 990,000 Cost of goods sold 675,000 Gross margin 315,000 Selling and administrative expenses Selling $ 109,000 Administration 122,000 231,000 Net operating income $ 84,000 On average, a book sells for $60. Variable selling expenses are $6 per book with the remaining selling expenses being fixed. The variable administrative expenses are 5% of sales...
An income statement for Sam's Bookstore for the first quarter of the year is presented below:...
An income statement for Sam's Bookstore for the first quarter of the year is presented below: Sam's Bookstore Income Statement For Quarter Ended March 31 Sales $ 900,000 Cost of goods sold 630,000 Gross margin 270,000 Selling and administrative expenses Selling $ 100,000 Administration 104,000 204,000 Net operating income $ 66,000 On average, a book sells for $50. Variable selling expenses are $5 per book with the remaining selling expenses being fixed. The variable administrative expenses are 4% of sales...
An income statement for Sam's Bookstore for the first quarter of the year is presented below:...
An income statement for Sam's Bookstore for the first quarter of the year is presented below: Sam's Bookstore Income Statement For Quarter Ended March 31 Sales $ 990,000 Cost of goods sold 675,000 Gross margin 315,000 Selling and administrative expenses Selling $ 109,000 Administration 122,000 231,000 Net operating income $ 84,000 On average, a book sells for $60. Variable selling expenses are $6 per book with the remaining selling expenses being fixed. The variable administrative expenses are 5% of sales...
An income statement for Sam's Bookstore for the first quarter of the year is presented below:...
An income statement for Sam's Bookstore for the first quarter of the year is presented below: Sam's Bookstore Income Statement For Quarter Ended March 31 Sales $ 910,000 Cost of goods sold 530,000 Gross margin 380,000 Selling and administrative expenses Selling $ 113,000 Administration 130,000 243,000 Net operating income $ 137,000 On average, a book sells for $70. Variable selling expenses are $5 per book with the remaining selling expenses being fixed. The variable administrative expenses are 3% of sales...
3. Lagle Corporation has provided the following information: Cost per Unit Cost per Period Direct materials...
3. Lagle Corporation has provided the following information: Cost per Unit Cost per Period Direct materials $ 5.20 Direct labor $ 3.80 Variable manufacturing overhead $ 1.35 Fixed manufacturing overhead $ 7,600 Sales commissions $ 1.70 Variable administrative expense $ 0.30 Fixed selling and administrative expense $ 5,000 For financial reporting purposes, the total amount of period costs incurred to sell 4,000 units is closest to: Multiple Choice $13,000 $8,000 $5,000 $7,600 4. Lagle Corporation has provided the following information:...
Bellucci Corporation has provided the following information: Cost per Unit Cost per Period Direct materials $...
Bellucci Corporation has provided the following information: Cost per Unit Cost per Period Direct materials $ 6.90 Direct labor $ 3.90 Variable manufacturing overhead $ 1.40 Fixed manufacturing overhead $ 102,850 Sales commissions $ 1.00 Variable administrative expense $ 0.70 Fixed selling and administrative expense $ 37,400 The incremental manufacturing cost that the company will incur if it increases production from 8,500 to 8,501 units is closest to (assume that the increase is within the relevant range):
Lagle Corporation has provided the following information: Cost per Unit Cost per Period Direct materials $...
Lagle Corporation has provided the following information: Cost per Unit Cost per Period Direct materials $ 5.30 Direct labor $ 4.00 Variable manufacturing overhead $ 1.45 Fixed manufacturing overhead $ 8,500 Sales commissions $ 1.90 Variable administrative expense $ 0.35 Fixed selling and administrative expense $ 7,200 For financial reporting purposes, the total amount of period costs incurred to sell 5,000 units is closest to:
#6 Schwiesow Corporation has provided the following information: Cost per Unit Cost per Period Direct materials...
#6 Schwiesow Corporation has provided the following information: Cost per Unit Cost per Period Direct materials $ 7.05 Direct labor $ 3.50 Variable manufacturing overhead $ 1.65 Fixed manufacturing overhead $ 11,000 Sales commissions $ 1.00 Variable administrative expense $ 0.40 Fixed selling and administrative expense $ 5,500 For financial reporting purposes, the total amount of period costs incurred to sell 5,000 units is closest to: $5,500 $8,300 $12,500 $7,000 #3 Kesterson Corporation has provided the following information: Cost per...
iii) Brand Corporation has provided the following information: Cost per Unit Cost per Period Direct materials...
iii) Brand Corporation has provided the following information: Cost per Unit Cost per Period Direct materials $ 4.90 Direct labor $ 4.00 Variable manufacturing overhead $ 1.60 Fixed manufacturing overhead $ 8,700 Sales commissions $ 2.00 Variable administrative expense $ 0.35 Fixed selling and administrative expense $ 5,700 For financial reporting purposes, the total amount of period costs incurred to sell 3,000 units is closest to: Multiple Choice Top of Form $12,750 $7,050 $5,700 $8,700 Bottom of Form Bottom of...