Managerial

Chapter 1 – 4 Practice

| COSTS | |

Oil for factory machines | $2,000 | |

Depreciation on salespersons’ cars | 20,000 | |

Wages of assembly line workers | 500,000 | |

Rent on rooms at a Florida resort for holding the annual sales conference | 15,000 | |

Factory supervisors’ salaries | 190,000 | |

Material for units made | 410,000 | |

Salaries of finished goods warehouse personnel | 150,000 | |

Depreciation on factory equipment | 40,000 | |

1. $_____________ Determine the amount of product costs

2. $______________Determine the amount of manufacturing overhead costs

3. $_____________ Determine the amount of period (operating expenses)

B Corp has provided the following production and total cost data for two levels of monthly production volume. The company produces a single product. The product sells for $100.00 per unit

Production Volume | 17,000 units | 22,000 units |

Direct materials | $425,000 | $550,000 |

Direct labor | $255,000 | $330,000 |

Manufacturing overhead | $521,000 | $586,000 |

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4. $__________ per unit. Determine the best estimate of the total variable product cost per unit.

5. $_______________ Determine the best estimate of the total monthly fixed manufacturing cost.

6. $______________ Determine the best estimate of the TOTAL cost to manufacture 17,025 units.

7. $______________ Determine the estimated total contribution margin if sales are 17,025 units.

8. $_____________ Determine estimated net operating income if 17,025 units are sold.

Use the following to answer questions 9 - 13

Operating expense | $100,000 |

Beginning inventory | $10,000 |

Ending inventory | $7,500 |

Net Sales | $325,000 |

Gross profit | $125,000 |

Determine the following amounts based on the above data:

9. Cost of Goods sold $____________

10. Goods available for sale $____________

11. Purchases $____________

12. Net operating income...