Essay on Accounting Help - Practice Questions

4319 Words Feb 18th, 2012 18 Pages
Chapter 18: Practice questions

1-1 The total manufacturing cost per unit increases as total production volume increases.

1-2 Total variable costs change in response to changes in the volume of production.

1-3 The mixed cost per unit is constant throughout the relevant range of activity.

1-4 Fixed costs per unit decrease as production levels decrease.

1-5 A method used to separate mixed costs into fixed and variable components is called the high-low method.

1-6 The variable cost per unit is assumed to be constant within a particular relevant range of activity.

1-7 Which of the following costs changes in direct proportion to a change in volume? A) Average mixed cost B) Total fixed cost
…show more content…
A) 0.70 B) 0.44 C) 0.56 D) 0.30

1-22 Marino Company’s average manufacturing cost was $5.40 when 50,000 units were manufactured and was $5.25 when 80,000 units were manufactured. How much was Marino’s variable cost per unit? A) $5.25 B) $5.00 C) $5.40 D) $5.32

1-23 Total variable costs are $400,000 if 50,000 units are produced. Total fixed costs are $150,000 if 35,000 units are produced. Calculate the following: a) unit variable cost b) fixed cost per unit if 35,000 units are produced c) total variable costs if 35,000 units are produced

1-24 Mars Company has calculated its annual total fixed costs to be $75,000. Production for recent years has averaged 40,000 units with total variable costs of $120,000. Based on the foregoing data, complete the table below. Assume all activity levels are within the relevant range.

|Activity Level |Total Fixed Costs |Unit Fixed Cost |Total Variable Costs |Unit Variable Costs |
|20,000 | | | | |
|30,000 | | | | |

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