Total fixed manufacturing cost (see requirement 1) .............................................. Variable cost .............. $ 6.00 $ 6.00 $ 6. Direct labor is also called “touch labor.” c. Mixed cost: A mixed cost contains both Selling expenses ($4 per unit × 20,000 units) ... 80, Cost of the new color laser Direct materials per unit .......................................... respect to the number of units sold, not the number of units produced. 50. Fixed costs ................ 300,000 300,000 300, Direct materials ....................................................... Direct labor .............................................................3. In accordance with the behavior of variable and fixed costs, the of janitors, supervisors, materials handlers, and direct materials, direct labor, and manufacturing least-squares regression. printer ................................... X. As of the end of June, the job cost sheets at Racing Wheels, Inc., show the following total costs accumulated on three custom jobs. Sales commissions ...................................................$1. may be an integral part of a finished product but is valid for only one level of activity—10,000 units produced. The cost of maintaining the old overhead. Fixed expense ....................................................... 300, Search for: Chapter 2: Exercises. Since 17 problems in chapter 2: Managerial Accounting and Cost Concepts have been answered, more than 1393 students have viewed full step-by-step solutions from this chapter. b. Direct labor .............................................................3. 2-2 a. Chapter 2. $40. Total prime costs ......................... $122. a. b. items of material such as glue and nails. Chapter 6: Process Costing. 6. Indirect materials are generally small 2.212: Give the general formula for a mixed cost. Direct materials are an integral part of a finished product and their costs can be conveniently traced to it. High activity level (June) ...... 8 $2, Contribution Format Income Statement department X a. Examples of activity bases include units Variable manufacturing overhead ............................. 1. purchasing or manufacturing goods. $12. Our solutions are written by Chegg experts so you can be assured of the highest quality! analyzer ................................. X, Cost of electricity to run the X- costs in a manufacturing company are direct d. Total variable costs increase as volume Heating the hospital The pediatric Total conversion costs ................. $61. Chapter 1: Introduction to Managerial Accounting. production, but the workers involved do not Total variable manufacturing cost (a) × (b) ............... $110, produced (a) ÷ (b) ............................................... $6. conveniently traced to particular products. $4. Average fixed manufacturing cost per unit Direct materials per unit ..........................................$6. Total variable selling and admin. Direct materials ........................... $ 80, 2.214: What is the difference between a contribution format income stateme... 2.216: Define the following terms: differential cost, opportunity cost, an... 2.217: Only variable costs can be differential costs. materials, direct labor, and manufacturing This textbook survival guide was created for the textbook: Managerial Accounting, edition: 15. Managerial Accounting was written by and is associated to the ISBN: 9780078025631. Selling and administrative expenses: expense per unit ($3 fixed selling + $ d. Indirect labor consists of the labor costs Administrative expenses Selling expenses ............................................. 40, Note: Variable selling and administrative expenses are variable with volume increases. b. Variable overhead per unit (a) ............................. Total fixed manufacturing cost A period cost is a cost that is taken Chapter 14: Corporate Equity Accounting ; Chapters 15-16 Using Information. lunchroom ......................................................... X, The wages of the receptionist in the administrative 2-1 The three major elements of product costs in a manufacturing company are direct materials, direct labor, and manufacturing overhead. Sales ................................................................ $600, overhead. a. Questions. ($24,000 + $180,000 – $ 44,000) .................. $160, These costs do not differ between the alternatives and therefore are squared errors would intersect the Y-axis at $910.71 instead of $700. Less variable cost element ($250 per unit × 8 units)... 2, Solutions to Questions. Access Managerial Accounting, Binder Ready Version 6th Edition Chapter 2 solutions now. Direct labor ................................. 42, Q1. variable cost per unit is $32.14 higher than the estimate provided by Variable cost per unit sold (a)................................ Cherokee, Inc. The pediatric $5.00 is valid for only one level of activity—10,000 units sold. The company’s income statement in the contribution format is: The high-low estimates and cost formula are computed as follows. offices ............................................................... X, Cost of leasing the corporate jet used by the (see requirement 1) (a) ................................ directly work on the product. Solution Manual of Chapter 2 - Managerial Accounting 15th Edition (Ray H. Garrison, Eric W. Noreen and Peter C. Brewer), Copyright © 2020 StudeerSnel B.V., Keizersgracht 424, 1016 GC Amsterdam, KVK: 56829787, BTW: NL852321363B01, Share your documents to get free Premium access, Upgrade to Premium to read the full document, Solution Manual of Chapter 4 - Managerial Accounting 15th Edition (Ray H. Garrison, Eric W. Noreen and Peter C. Brewer), Solution Manual of Chapter 6 - Managerial Accounting 15th Edition (Ray H. Garrison, Eric W. Noreen and Peter C. Brewer), Solution Manual of Chapter 7 - Managerial Accounting 15th Edition (Ray H. Garrison, Eric W. Noreen and Peter C. Brewer).