HW_8_ANSWERS_ - 1. A review of Parry Corporation's...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
1. A review of Parry Corporation's accounting records found that at a volume of 90,000 units, the variable and fixed cost per unit amounted to $8 and $4, respectively. On the basis of this information, what amount of total cost would Parry anticipate at a volume of 85,000 units? A. $1,020,000. B. $1,040,000. C. $1,060,000. D. $1,080,000. E. Some other amount not listed above. (4)(90,000) + (8)(85,000) =1,040,000 2. Song, Inc., uses the high-low method to analyze cost behavior. The company observed that at 22,000 machine hours of activity, total maintenance costs averaged $33.40 per hour. When activity jumped to 25,000 machine hours, which was still within the relevant range, the average total cost per machine hour was $30.40. On the basis of this information, the variable cost per machine hour was: A. $8.40. B. $22.00. C. $25.00. D. $30.40. E. $33.40. 33.40(22,000) ; (30.40)(25000) =734,800 - 760,000 = 25,200 / 3,000 25,000-23,000 = 8.40 3. Northridge, Inc., uses the high-low method to analyze cost behavior. The company observed that at 20,000 machine hours of activity, total maintenance costs averaged $10.50 per hour. When activity jumped to 24,000 machine hours, which was still within the relevant range, the average total cost per machine hour was $9.75. On the basis of this information, the company's fixed maintenance costs were: A. $24,000. B. $90,000. C. $210,00. D. $234,000. E. an amount other than those listed above.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
4. The following data relate to the Lyle Company for May and August of the current year: May and August were the lowest and highest activity levels, and Lyle uses the high-low method to analyze cost behavior. Which of the following statements is true?
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 08/09/2011 for the course ACCOUNTING --- taught by Professor --- during the Spring '11 term at Universidad Iberoamericana.

Page1 / 6

HW_8_ANSWERS_ - 1. A review of Parry Corporation's...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online