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Question 16 (1 point) The relevant activity base for a cost depends upon which base is most closely associated with the cost and the decision-making...

Question 16   (1 point)
The relevant activity base for a cost depends upon which base is most closely associated with the cost and the decision-making needs of management.
• True
• False
Question 23   (1 point)
Because variable costs are assumed to change in constant proportion with changes in the activity level, the graph of the variable costs when plotted against the activity level appears as a circle.
• True
• False
Question 25   (2 points)
A business operated at 100% of capacity during its first month and incurred the following costs:
Production costs (5,000 units):
  Direct materials $70,000
  Direct labor 20,000
  Variable factory overhead 10,000
  Fixed factory overhead   2,000 $102,000
Operating expenses:
  Variable operating expenses $17,000
  Fixed operating expenses   1,000 18,000
If 1,000 units remain unsold at the end of the month and sales total $150,000 for the month, what would be the amount of income from operations reported on the absorption costing income statement?
• 50,400  
• 50,000  
• 52,000  
• 70,000
Question 49   (2 points)
The Martin Company had a finished goods inventory of 55,000 units on January 1. It's projected sales for the next four months were: January - 200,000 units; February - 180,000 units; March - 210,000 units; and April - 230,000 units. The Martin Company wishes to maintain a desired ending finished goods inventory of 20% of the following months sales.  What would the budgeted inventory for March 31 be?
• 46,000
• 36,000  
• Cannot be determined from the data given  
• 42,000  

 (1 point)
Top of Form
The relevant activity base for a cost depends upon which base is most
closely associated with the cost and the decision-making needs of
management.
True
False
 (1 point)
Top of Form
Because variable costs are assumed to change in constant proportion with
changes in the activity level, the graph of the variable costs when
plotted against the activity level appears as a circle.
Bottom of Form
True
False
 (2 points)
Top of Form
A business operated at 100% of capacity during its first month and
incurred the following costs:
Production costs (5,000 units):    
  Direct materials $70,000  
  Direct labor 20,000  
  Variable factory overhead 10,000  
  Fixed factory overhead   2,000 $102,000
     
Operating expenses:    
  Variable operating expenses $17,000  
  Fixed operating expenses   1,000 18,000
If 1,000 units remain unsold at the end of the month and sales total
$150,000 for the month, what would be the amount of income from
operations reported on the absorption costing income statement?
50,400  
50,000  
52,000  
70,000
 (2 points)
Top of Form
The Martin Company had a finished goods inventory of 55,000 units on
January 1. It's projected sales for the next four months were: January -
200,000 units; February - 180,000 units; March - 210,000 units; and
April - 230,000 units. The Martin Company wishes to maintain a desired
ending finished goods inventory of 20% of the following months sales. 
What would the budgeted inventory for March 31 be?
46,000
36,000  
Cannot be determined from the data given  
42,000  

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