Ch 3 Solutions to Assigned Homework

# Ch 3 Solutions to Assigned Homework - Chapter 3 Solutions...

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Chapter 3 Solutions to Assigned Homework EXERCISES AND PROBLEMS Exercise 3–20 a. Power to operate a drill (to drill holes in the wooden frames of the futons)— Variable cost b. Cloth to cover the futon mattress—Variable cost c. Salary of the factory receptionist—Fixed cost d. Cost of food and decorations for the annual 4th of July party for all factory employees—Fixed cost e. Fuel for a forklift used to move materials in a factory—Variable cost f. Depreciation on the factory—Fixed cost g. Depreciation on a forklift used to move partially completed goods—Fixed cost h. Wages paid to workers who assemble the futon frame—Variable cost i. Wages paid to workers who maintain the factory equipment—Fixed cost j. Cloth rags used to wipe the excess stain off the wooden frames—Variable cost Exercise 3–28 1. The high point is March with 3,100 appointments. The low point is January with 700 appointments. 2. Variable rate = \$2,790 - \$1,758 3,100 - 700 = 2,400 \$1,032 = \$0.43 per tanning appointment Using the high point: Fixed cost = \$2,790 – (\$0.43 × 3,100) = \$1,457 OR Using the low point: Fixed cost = \$1,758 – (\$0.43 × 700) = \$1,457 3. Total tanning service cost = \$1,457 + (\$0.43 × Number of appointments) 4. Total predicted cost for September = \$1,457 + (\$0.43 × 2,500) = \$2,532 Total fixed cost for September = \$1,457 Total predicted variable cost = \$0.43(2,500) = \$1,075

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Exercise 3–31 1. Airplane depreciation: Variable rate =
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Ch 3 Solutions to Assigned Homework - Chapter 3 Solutions...

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