Solution_Summer 2007 Final

# Solution_Summer 2007 Final - Stanford University MSE...

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Stanford University MSE 140-240 Summer 07 ke q, Name Final d 150 Points ( Question 1-33 at 4 points and question 34 at 18 points ) MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) Which of the following is a fixed cost for an automobile manufacturing plant? 1) A A) administrative salaries B) sales commissions C) electricity used by assembly-line machines D) windows for each car produced 2) A band of normal activity or volume in which specific cost-volume relationships are maintained is referred to as the: A A) relevant range B) cost-allocation range C) average range D) cost driver range 3) When 10,000 units are produced, variable costs are \$6 per unit. Therefore, when 20,000 units are produced: 3) A) variable costs will total \$60,000 Vc *b B) variable unit costs will decrease to \$3 per unit , .. ,, ,- C) variable unit costs will increase to \$12 per unit . . D) variable casts will total \$120,000 4) Christi Manufacturing provided the following information for last month: 4 I J,G ~JD ZVLLQS'~ 4) & Sales \$10,000 2 3 ~010~~ Variable costs 3,000 c 2- = ( CbloOo'~ a cw 70 Fixed costs 3J&O Operating inco~ne \$2,000 If sales double next month, what is the projected operating income? 5) Wheel and Tire Manufacturing currently produces 1,000 tirei per month. The following per unit 5) D data apply for sales to regular customers: Direct materials Direct manufacturing labor 3 - RCjvi Y 2003 = ,.~.800~ Variable manufacturing overhead 520 1 6-A - Fixed manufacturing overhead - 10 io FL Y /Y'D o /d,ooo Total manufacturing costs \$39 -_CC_ - - Gti,ooo The plant has capacity for 3,000 tires and is considering expanding production to 2,000 tires. What is the total cost of producing 2,000 tires?

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6) Tire and Spoke Manufacturing currently produces 1,000 bicycles per month. The following per unit 6) d> data apply for sales to regular customers: Direct materials Direct manufacturing labor Variable manufacturing overhead 14 3 Fixed manufacturing overhead - loyrooo i/O,ooo ,- WOD~~ = -c.-c- <PC Total manufacturing costs \$79 7 d The plant has capacity for 3,000 bicycles and is considering expanding production to 2,000 bicycles. What is the per unit cost of producing 2,000 bicycles? A) \$79 per unit B) \$134 per unit C) \$158 per unit D) \$74 per unit Answer the following questions using the information below: Pederson Company reported the following: Manufacturing costs Units manufactured 50,000 Units sold 47,000 units sold for \$75 per unit Beginning inventory 0 units 7) What is the average manufacturing cost per unit? 7, A A) \$0.025 B) \$75.00 C) \$42.55 D) \$40.00 8) For a manufacturing-sector company, the cost of factory insurance is classified as a: 8) A) period cost B) direct material cost C) manufacturing overhead cost D) direct manufacturing labor cost 9) The income statement of a manufacturing firm reports: A) period costs only 8) both period and inventoriable costs C) inventoriable costs only D) period and inventoriable costs but at different times; the reporting varies Answer the following questions using the information below: Kaiser's Kraft Korner sells a single product. 7,000 units were sold resulting in \$70,000 of sales revenue, \$28,000 of variable costs, and \$12,000 of fixed costs.
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Solution_Summer 2007 Final - Stanford University MSE...

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