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Chapter 2 problems 41 NUMERIC QUESTIONS Ej 86 through 188

# Chapter 2 problems 41 NUMERIC QUESTIONS Ej 86 through 188 -...

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CHAPTER 2 AN INTRODUCTION TO COST TERMS AND PURPOSES 86. When 10,000 units are produced, fixed costs are \$14 per unit. Therefore, when 20,000 units are produced fixed costs will: a. increase to \$28 per unit b. remain at \$14 per unit c. decrease to \$7 per unit d. total \$280,000 87. When 10,000 units are produced, variable costs are \$6 per unit. Therefore, when 20,000 units are produced: 88. Christi Manufacturing provided the following information for last month: Sales \$10,000 Variable costs 3,000 Fixed costs 5,000 Operating income \$2,000 If sales double next month, what is the projected operating income? 89. Kym Manufacturing provided the following information for last month: Sales \$12,000 Variable costs 4,000 Fixed costs 1,000 Operating income \$7,000 If sales double next month, what is the projected operating income? 90. Wheel and Tire Manufacturing currently produces 1,000 tires per month. The following per unit data apply for sales to regular customers: 2- 1

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Direct materials \$20 Direct manufacturing labor 3 Variable manufacturing overhead 6 Fixed manufacturing overhead 10 Total manufacturing costs \$39 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? a. \$39,000 b. \$78,000 c. \$ 68,000 d. \$62,000 92. Tire and Spoke Manufacturing currently produces 1,000 bicycles per month. The following per unit data apply for sales to regular customers: Direct materials \$50 Direct manufacturing labor 5 Variable manufacturing overhead 14 Fixed manufacturing overhead 10 Total manufacturing costs \$79 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? Answer : c Difficulty : 3 Objective : 4 [(\$50 + \$5 + \$14) x 2,000 units] + (\$10 x 1,000 units) = \$148,000 / 2,000 units = \$74 Terms to Learn : unit cost THE FOLLOWING INFORMATION APPLIES TO QUESTIONS 95 THROUGH 97: Pederson Company reported the following: Manufacturing costs \$2,000,000 Units manufactured 50,000 Units sold 47,000 units sold for \$75 per unit Beginning inventory 0 units 95. What is the average manufacturing cost per unit? 2- 2
96. What is the amount of ending finished goods inventory?

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