Question

1. Corporation reports that at an activity level of 9,300 units, its total variable cost is $669,600 and its total fixed cost is $96,650. What would be the total cost, both fixed and variable, at an activity level of 9,500 units? Assume that this level of activity is within the relevant range.

• $766,250

• $774,489

• $780,650

• $783,750

• 2.The following costs were incurred in April:

• Direct materials	$48,000
  Direct labor	$32,000
  Manufacturing overhead	$26,000
  Selling expenses	$23,000
  Administrative expenses	$36,000

  
  Prime costs during the month totaled:

• $80,000

• $165,000

• $58,000

• $106,000

3.

alip Corporation, a merchandising company, reported the following results for October:

Sales	$	424,800
Cost of goods sold (all variable)	$	180,100
Total variable selling expense	$	18,200
Total fixed selling expense	$	15,300
Total variable administrative expense	$	8,700
Total fixed administrative expense	$	31,200

The contribution margin for October is:

• $351,400

• $217,800

• $244,700

• $171,300

Answer 1

1) Calculate total Cost

Variable cost (669600/9300*9500)	684000
Fixed cost	96650
Total	780650

So answer is c) $780650

2) Prime cost = Direct material+Direct labor = 48000+32000 = 80000

So answer is a) $80000

3) Contribution margin = 424800-180100-18200-8700 = 217800

So answer is b) $217800