Tracie Corporation manufactures and sells women\'s skirts. Each skirt (unit) req
ID: 2597863 • Letter: T
Question
Tracie Corporation manufactures and sells women's skirts. Each skirt (unit) requires 2.2 yards of cloth. Selected data from Tracie's master budget for next quarter are shown below:
Each unit requires 0.8 hours of direct labor, and the average hourly cost of Tracie's direct labor is $18. What is the cost of Tracie Corporation's direct labor in September?
Multiple Choice
$208,800
$225,000
$261,000
$180,000
2.
Frolic Corporation has budgeted sales and production over the next quarter as follows:
The company has 4,700 units of product on hand at July 1. 10% of the next month's sales in units should be on hand at the end of each month. October sales are expected to be 75,000 units. Budgeted sales for September would be (in units):
Garrison 16e Rechecks 2017-09-30, 2017-10-31
Multiple Choice
67,650
58,500
67,500
65,700
3.
The Southern Corporation manufactures a single product and has the following cost structure:
Last year, 7,980 units were produced and 7,680 units were sold. There was no beginning inventory.
The carrying value on the balance sheet of the ending inventory of finished goods under variable costing would be:
Multiple Choice
the same as absorption costing.
$7,680 greater than under absorption costing.
$7,680 less than under absorption costing.
$6,600 less than under absorption costing.
4.
The following are budgeted data:
One pound of material is required for each finished unit. The inventory of materials at the end of each month should equal 30% of the following month's production needs. Purchases of raw materials for February would be budgeted to be:
Garrison 16e Rechecks 2017-10-03
Multiple Choice
18,630 pounds
19,670 pounds
19,830 pounds
18,570 pounds
5.
Foster Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead costs and its activity based costing system:
Overhead costs:
Distribution of resource consumption:
The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs.
The amount of activity for the year is as follows:
What would be the total overhead cost per delivery according to the activity based costing system? In other words, what would be the overall activity rate for the deliveries activity cost pool? (Round to the nearest whole cent.)
Multiple Choice
$9.33
$9.76
$8.05
$10.62
6.
The manufacturing overhead budget at Foshay Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 6,500 direct labor-hours will be required in May. The variable overhead rate is $8.90 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $122,200 per month, which includes depreciation of $24,920. All other fixed manufacturing overhead costs represent current cash flows. The company recomputes its predetermined overhead rate every month. The predetermined overhead rate for May should be:
Multiple Choice
$18.80
$8.90
$24.20
$27.70
July August September Budgeted sales (in units) 8,500 10,500 12,500 Budgeted production (in units) 9,500 12,000 14,500Explanation / Answer
(1) $ 208800 (14500*0.8*18)
(2) $ 58500
Op Stock 4700 5550 5850
Production 44350 55800 60150
Sales 43500 55500 58500
Cl Stock 5550 5850 7500 (10% 0f 75000)
(3) $ 6600 less than absorption costing.
Absorption Costing = (35+14+22 (175560/7980))*300 = 21300
Variable Costing = (35+14) * 300 = 14700
Difference = 6600
(4) $ 19770
Opening Stock of February = 30% of Production = 19200 * 30% = 5760
Purchase during the month (Balancing Figure) = 19770
Sales during the month = 20400
Closing Stock of February = 30% of Production = 17100*30% = 5130
(6) Variable Cost = $ 8.90
Fixed cost = $ 18.80
Total = $ 27.70
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