Question

#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 Unit		Cost per Period
Direct materials	$	6.20
Direct labor	$	3.10
Variable manufacturing overhead	$	1.35
Fixed manufacturing overhead			$	14,000
Sales commissions	$	1.50
Variable administrative expense	$	0.40
Fixed selling and administrative expense			$	4,500

If the selling price is $21.90 per unit, the contribution margin per unit sold is closest to:

$12.60

$9.35

$8.45

$5.65

#1

At a volume of 5,000 units, Pwerson Company incurred $32,000 in factory overhead costs, including $14,000 in fixed costs. If volume increases to 6,000 units and both 5,000 units and 6,000 units are within the relevant range, then the company would expect to incur total factory overhead costs of: (Round intermediate calculations to 2 decimal places.)

Garrison 16e Rechecks 2017-06-28

$21,600

$35,600

$32,000

$18,000

Answer 1

#6

The cost than can not be assigned to any product, but charged as an expense is known as period cost

So, in this example fixed selling and administrative expense is period cost. So total period cost is $5,500. Answer is $5,500

#3

Selling price $21.90

Less:

Direct Materials 6.20

Direct Labor 3.10

Variable Manufacturing overhead 1.35

Sales Commission 1.50

Variable administrative expense 0.40

Contribution margin per unit $9.35

Answer is $9.35

#1

Variable cost at 5000 units = $32,000-$14,000 = $18,000

Variable cost per unit = 18,000/5000 = $3.60 per unit

Total cost at 6000 units = $14,000+($3.60*6000 units)

= $14,000+$21,600

= $35,600

Answer is $35,600