Ac505 Page 1 Final

1. (TCO A) Wages paid to the factory supply shop foreman are considered an example of: (Points: 5) Direct Labor - yes, Period Cost - yes Direct Labor - yes, Period Cost - No Direct Labor - no , Period Cost - yes Direct Labor - no , Period Cost - no

2. (TCO A) Rent on a manufacturing plant is an element of: (Points: 5) Conversion cost - yes, period cost - no Conversion cost - yes, period cost - yes Conversion cost - no, period cost - yes Conversion cost - no, period cost - no

3. (TCO B) Evergreen Corp. has provided the following data:

Sales per period 1,000 units
Selling price $40 per unit
Variable manufacturing cost $12 per unit
Selling expenses $5,100 plus 5% of selling price
Administrative expenses $3,000 plus 20% of selling price The number of units needed to achieve a target net operating income of $99,900 would be:
(Points: 5) 5,970 units 6,000 units 6,240 units 6,500 units

4. (TCO B) Garth Company sells a single product. If the selling price per unit and the variable expense per unit both increase by 12% and fixed expenses do not change, then: (Points: 5) Contribution Margin Per Unit - Increases, Contribution Margin Ratio - Increases, Break-Even in Units - Decreases Contribution Margin Per Unit - No Change, Contribution Margin Ratio - No Change, Break-Even in Units - No Change Contribution Margin Per Unit - No Change, Contribution Margin Ratio-Increases, Break-Even in Units - No Change Contribution Margin Per Unit - Increases, Contribution Margin Ratio - No Change, Break-Even in Units - Decreases

5. (TCO E) Rebel Company manufactures a single product and has the following cost structure:

Variable costs per unit: