Chapter 4: Costs and Cost Minimization Multiple Choice 1. Suppose you are a star basketball player at a major university in your sophomore year. You are sought after by several NBA teams. Which of the following choices best characterizes your opportunity cost if you choose to drop out of college and enter the NBA? a) The value of your college scholarship that you have given up. b) The skills that two more years of playing at your college would have given you along with their additional value
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marks = ________ % Grade: Question I: Identification: Fill in the blanks the correct answer. You are having a dress shop‚ indicate the proper classification of cost behavior whether it is VARIABLE or FIXED for each of the following items below: |Cost Element |Cost Behavior | |Material used to make shirts |
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Average Variable Cost : 2002 $1‚011‚008** **$417‚004+$124‚101.20+$117‚903+$351‚000 2003 1‚142‚681.00** ** $520‚069+$171‚622.70+$79‚888+$371‚101 2004 1‚798.131.00 ** ** $915‚787.50+$320‚525.52 +$115‚999+$445‚819 Total $3‚951‚820.00 No.of Years 3 Average VC $1‚317‚273.00 Average Customers 8‚202.00 Average VC per unit $161.00 Fixed Cost $174
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1 In a process cost system‚ product costs are summarized: on job cost sheets. when the products are sold. after each unit is produced. on production cost reports. What decision criteria should managers use in selecting projects when there is not enough capital to invest in all available positive NPV projects? the internal rate of return the discounted payback the profitability index the modified internal rate of return 3 Horizontal
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Allocation of Fixed Costs ACC 403 Principles of Accounting The articles describe two different approaches: Lean accounting and activity based costing. Both have pros and cons and the selection of "what is best for allocating IT" likely rests with the culture and types of businesses. I personally believe that activity-based costing‚ which essentially casts IT as a variable cost‚ making users sensitive to the requests they make of IT because every request is an incremental cost to their budget
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manager to plan strategy? The output of concern to the campaign manager is the number of votes. The production function has two inputs‚ television advertising and letters. The use of these inputs requires knowledge of the substitution possibilities between them. If the inputs are perfect substitutes for example‚ the isoquants are straight lines‚ and the campaign manager should use only the less expensive input in this case. If the inputs are not perfect substitutes‚ the isoquants will have a convex
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Fixed cost are ones that don’t change in view of included factors (Fixed‚ variable‚ and negligible cost‚ 2017). There are few fixed expenses with working a vehicle. Fixed cost will incorporate the cost of the vehicle‚ the cost of protection‚ enlistment and property charges. These are cost the vehicle will acquire regardless of the possibility that it sits untouched in the carport. Be that as it may‚ once the vehicle moves it has variable expenses. These variable expenses incorporate gas‚ general
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Page 1 1. | Indirect labor is a part of: | A | Prime cost. | B | Conversion cost. | C | Period cost. | D | Nonmanufacturing cost. | 2. | Prime cost and conversion cost share what common element of total cost? | A | Direct materials. | B | Direct labor. | C | Variable overhead. | D | Variable overhead. | 3. | On the Schedule of Cost of Goods Manufactured‚ the final Cost of Goods Manufactured figure represents: | A | the amount of cost charged to Work in Process
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Section B Attempt Any Six Questions (6*5= 30) 1. Company A’s costs are mostly variable‚ whereas Company B’s costs are mostly fixed. When sales increase‚ which company will tend to realize the greatest increase in profits? Explain. 2. Crystal Telecom has budgeted the sales of its innovative mobile phone over the next four months as follows: Sales in Units July. . . . . . . . . . . . . . 30‚000 August . . . . . . . . . . . 45‚000 September . . . . . . . . 60‚000 October . . . .
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Plant overhead $122‚000 D/L rate/hour $30 Youngstown has a traditional cost system. It calculates a plant-wide overhead rate by dividing total overhead costs by total direct labor hours. Assume‚ for the calculations below‚ that plant overhead is a committed (fixed) cost during the year‚ but that direct labor is a variable cost. 1. Calculate the plant-wide overhead rate. Use this rate to assign overhead costs to products and calculate the profitability of the four products. The assignment
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