Lancer Media produces a high-end DVD player that sells for P1,250.
Total
operating expenses for the past 12 months are as follows:
By computing for the unit cost, y
Units produced and sold 140 175 190 220 If the unit cost does not change
Administrative costs 14,500.00 15,200.00 15,750.00 16,100.00 Semi 103.57
Advertising 2,500.00 2,500.00 2,500.00 2,500.00 Fixed If the total cost does not chang
Assembly labor 22,400.00 28,000.00 30,400.00 35,200.00 160.00
Component cost 63,000.00 78,750.00 85,500.00 99,000.00 450.00
Electricity 250.00 310.00 400.00 470.00 Semi 1.79
Gas 200.00 260.00 340.00 400.00 Semi 1.43
Rent 2,200.00 2,200.00 2,200.00 2,200.00 Fixed
Shipping 1,540.00 1,620.00 1,700.00 1,790.00 Semi 11.00
Supervisor salary 5,500.00 5,500.00 5,500.00 5,500.00 Fixed
Supplies 1,680.00 2,100.00 2,280.00 2,640.00 12.00
Telephone 180.00 188.00 192.00 200.00 1.29
Total 113,950 136,628 146,762 166,000 Semi
a. Using method of least square determine how much of the semi-variable cost is fixed and variable and compute for the to
b. Using High and Low Method determine how much of the operating expense is variable and how much is fixed.
Units produced and sold 140 175 190 220
Administrative costs 14,500.00 15,200.00 15,750.00 16,100.00
Electricity 250.00 310.00 400.00 470.00
Gas 200.00 260.00 340.00 400.00
Shipping 1,540.00 1,620.00 1,700.00 1,790.00
Telephone 180.00 188.00 192.00 200.00
16,670.00 17,578.00 18,382.00 18,960.00
2,290.00
80 28.625
12,662.50
By computing for the unit cost, you will be able to identify the semi-variable cost
If the unit cost does not change then the item is variable otherwise it is semi-variable.
86.86 82.89 73.18 Semi
If the total cost does not change, then the item is fixed.
160.00 160.00 160.00 Var
450.00 450.00 450.00 Var
1.77 2.11 2.14 Semi
1.49 1.79 1.82 Semi
9.26 8.95 8.14 Semi
12.00 12.00 12.00 Var
1.07 1.01 0.91 Semi
d variable and compute for the total operating expenses that would be incurred for 200 units.
nd how much is fixed.
The following information were taken from the books of Maria
Corporation:
Month Utility Cost Repair Cost
Jan 950 502 0.940
Feb 1,175 733 467.083 1,724 950
Mar 1,425 1,090 1,323 502
Apr 1,506 1,135 401 448 0.895089
May 1,618 1,186 873.6652
Jun 1,525 1,154 873.6652
Jul 1,675 1,264
Aug 1,724 1,323 2082.036
Sep 1,626 1,230
Oct 1,575 1,165
Nov 1,653 1,237
Dec 1,418 1,035
(1) Using hi-lo method determined the unit cost variable cost and
total fixedmethod
(2) Under using: (a)
ofMachine Hrs (b)
least square andLabor
usingHrs
the independent
variable that best forecast the value of the dependent variable,
determine how much utility cost will be incurred for the production
that requires 1,380 machine hours and 1,250 Labor hours. (Note:
use the independent variable that gives the higher coefficient of
correlation (r))
1323
30
40
Which of the following costs is not a product cost?
Depreciation on the plant installed in the factory
The electricity cost of the office of factory foreman
The cost of shipping finished products to customers
The cost of fuel used in the factory
The cost of alternative ‘A’ is P25,000 and the cost of alternative ‘B’ is P20,000. In cost accounting, the
excess of P5,000 in costs of alternative A over alternative B would be termed as:
Opportunity Cost
Relevant Cost
Differential cost
Out of Pocket Cost
The Washington Company incurred P50,000 to ship 22,000 liters and P42,000 to ship 18,000 liters. If the
company ships 20,000 liters, its expected shipping expense would be closest to:
P40,000
P44,000
P46,000
P48,000
Within the relevant range:
both total variable costs and total fixed costs fluctuate
both total variable costs and total fixed costs will remain constant
variable costs per unit will remain constant and fixed costs per unit will fluctuate
fixed costs per unit will remain constant and variable costs per unit will fluctuate
An industry that would most likely use process costing procedures is:
Which of the following costs is not a product cost?
Depreciation on the plant installed in the factory
The electricity cost of the office of factory foreman
The cost of shipping finished products to customers
The cost of fuel used in the factory
The cost of alternative ‘A’ is P25,000 and the cost of alternative ‘B’ is P20,000. In co
Opportunity Cost
Relevant Cost
Differential cost
Out of Pocket Cost
The Washington Company incurred P50,000 to ship 22,000 liters and P42,000 to sh
P40,000
P44,000
P46,000
P48,000
Within the relevant range:
both total variable costs and total fixed costs fluctuate
both total variable costs and total fixed costs will remain constant
variable costs per unit will remain constant and fixed costs per unit will fluctuate
fixed costs per unit will remain constant and variable costs per unit will fluctuate
An industry that would most likely use process costing procedures is:
a. Beverage.
b. Home Construction.
c. Printing.
d. Shipbuilding.
A law firm wanting to track the costs of serving different clients may use a:
a. process cost system.
b. job order cost system.
c. cost control system.
d. standard cost system.
Which of the following is most likely to be considered an indirect material in the m
a. Lumber
b. Glue
c. Fabric
d. Foam rubber
The Macke Company’s payroll summary showed the following in November:
Sales deparP10,000
Supervisor salaries 20,000
Assembly w 25,000
Machine op 35,000
Maintenanc 15,000
Accounting 5,000
What is the amount that would be included in direct labor in November?
a. P25,000
b. P60,000
c. P95,000
d. P120,000
The Macke Company’s payroll summary showed the following in November:
Sales deparP10,000
Supervisor 20,000
Assembly w 25,000
Machine op 35,000
Maintenanc 15,000
Accounting 5,000
What is the amount that would be included in factory overhead in November?
a. P20,000
b. P35,000
c. P70,000
d. P55,000
Which of the following is generally not considered a service organization?
a. Hair stylists
b. Lawyers
c. Auto dealerships
d. Plumbers
Which of the following is classified as a period cost?
The wages of the workers on a shipping decks who loads completed products onto
The wages of the worker paid for idle time resulting from a machine breakdown in
The payment for employee (fringe) benefits paid on behalf of the workers in the m
The wages paid to the workers for rework on defective products.
Which of the following items is a product cost for a manufacturing company?
Insurance on the corporate headquarter building
Depreciation on salesperson’s vehicle.
Property taxes on factory
Salary of general manager
Orocan Corp., manufactures plastic coated metal clips. The following were among
Wages Materials used
Machine ope
Metal wire P 500,000
Maintenance
Lubricant for oiling machinery 10,000
Factory Forma
Plastic Coating 380,000
Compute for the Prime Costs.
740,000
720,000
1,200,000
1,080,000
All costs related to the manufacturing function in a company are:
Prime Cost
Conversion Cost
Direct Department Cost
Product Cost
Job order costing and process costing differ in the way:
Manufacturing cost are assigned to production runs and the number of units for w
Orders are taken and the number of units in the orders
Product profitability is determined and compared with planned costs.
Manufacturing processes can be accomplished and the number of production runs
A company allocates its variable factory overhead based on direct labor hours. Dur
October NovemberDecember
Direct labor hours 2,500 3,000 5,000
Total factory
overhead allocated P80,000 P75,000 P100,000
Based upon this information, the estimated variable cost per direct labor hour was
A. P.125
B. P12.50
C. P.08
D. P8
alternative ‘B’ is P20,000. In cost accounting, the excess of P5,000 in costs of alternative A over alternative B would be termed as:
2,000 liters and P42,000 to ship 18,000 liters. If the company ships 20,000 liters, its expected shipping expense would be closest to:
main constant
d costs per unit will fluctuate
e costs per unit will fluctuate
g procedures is:
ent clients may use a:
d an indirect material in the manufacture of a sofa?
following in November:
labor in November?
following in November:
y overhead in November?
service organization?
ads completed products onto outgoing trucks.
rom a machine breakdown in the molding operation.
behalf of the workers in the manufacturing plant.
ve products.
manufacturing company?
s. The following were among Orocan’s 2020 manufacturing costs:
ompany are:
and the number of units for which the costs are average.
th planned costs.
he number of production runs that may be performed.
sed on direct labor hours. During the past three months, the actual direct labor hours and the total factory overhead allocated were as fol
cost per direct labor hour was:
would be termed as:
nse would be closest to:
verhead allocated were as follows:
