cost accounting

To estimate the monthly maintenance cost for the maintenance department in a hospital, the following monthly costs are available:

MONTHLY EXPENSE	COSTS
Supervisor Salary Expense	$4,000
Depreciation Expense – Maintenance Equipment	$6,000
Repairs Expense – Maintenance Equipment	$6,000
Supplies Expense	$9,000
Wages Expense – Maintenance Workers	$13,000

The Supervisor Salary Expense and the Depreciation Expense are both fixed costs. The remaining expenses are variable costs. There are 1,000 patient days in a month, which is the cost driver for maintenance costs. Estimate the cost function where Y is the monthly maintenance cost and X is the variable cost per patient day.

Y = $10,000 + $28X

Y = $10,000 + $28,000X

Y = $38,000 + $28,000X

Y = $10 + $28X

Presented below is the production data for six months of the year showing the mixed costs incurred by Famous Company.

MONTH	COST	UNITS
July	$9,500	4,000
August	$10,000	5,100
September	$12,200	6,800
October	$14,000	10,000
November	$13,100	8,000
December	$11,400	6,200

Famous Company uses the high-low method to analyze mixed costs. The predicted total cost at an operating level of 8,000 units is __________.

$14,000

$12,500

$12,000

$13,100

Elegant Motel's cost function is given as:

Y = $60,000 + $8.25X

Where:

Y = annual custodial cost

X = number of guest-days of occupancy

In the current year, Elegant Motel has 7,500 guests days. In the next year, Elegant Motel expects an occupancy level of 9,000 guest days. All costs next year will remain in the same relevant range as the current year. What is the expected fixed custodial cost for next year?

$95,000

$72,000

$60,000

$6.67

Infinity Company uses activity-based costing, and normally produces 1,000,000 units per month. At this level of production, the costs per unit are as follows:

Direct materials used	$15
Direct labor	$4
Variable indirect production	$3
Setup costs	$2

For 1,000,000 units, 500 setups are required at a cost of $4,000 per setup. The company has received a special order for 125,000 units at $30 per unit. The company has excess capacity. The company estimates that 3 setups will be required for the special order. What is the cost of the special order?

$2,762,000

$3,012,000

$3,000,000

$2,750,000

Jabber Company has budgeted sales of $36,000 with the following budgeted costs:

Direct materials	$7,100
Direct labor	$6,600
Variable factory overhead	$3,200
Fixed factory overhead	$5,300
Variable selling and administrative costs	$2.400
Fixed selling and administrative costs	$2,500

What is the average target markup percentage for setting prices as a percentage of total variable costs?

	A.	87%
	B.	46%
	C.	none of the above
	D.	62%

12 years ago

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