Janice Foeld Company manufactures part Z for use in its production cycle. The costs per unit for 10,000 units of part Z are as follows.

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Janice Foeld Company manufactures part Z for use in its production cycle. The costs per unit

for 10,000 units of part Z are as follows.

Direct materials $3
Direct labor 15
Variable overhead 6
Fixed overhead 8
TOTAL $32

Baloney Company has offered to sell Janice Foeld 10,000 units of part Z for $30 per unit. If Janice Foeld accepts Baloney’s offer, the released facilities can be used to save $45,000 in relevant costs in the manufacture of part A. In addition, $5 per unit of the fixed overhead applied to part Z would be totally eliminated.

The total relevant costs to buy part Z are

a) $320,000.
b) $300,000.
c)  $290,000.
d)  $255,000

 
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Yourtube Company uses a standard cost system and prepared the following budget at normal capacity for the month of January.

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Yourtube Company uses a standard cost system and prepared the following budget at normal capacity for the month of

January.

Direct labor hours 24,000
Variable factory overhead $ 48,000
Fixed factory overhead $108,000
Total factory overhead per DLH $6.50
Actual data for January were as follows:
Direct labor hours worked 22,000
Total factory overhead $147,000
Standard DLH allowed for the capacity attained 21,000

Using the two-way analysis of overhead variances, what is the budget (controllable) variance for January?

a) $3,000
b) $13,500 unfavorable
c) $9,000 favorable
d)  $10,500 unfavorable

 
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McConnell is a manufacturer of industrial components.

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McConnell is a manufacturer of industrial components. One of its products that is used as a subcomponent in auto

manufacturing is JC-46. This product has the following financial structure per unit.

Selling price $150
Direct materials 20
Direct labor 15
Variable manufacturing overhead 12
Fixed manufacturing overhead 30
Shipping and handling 3
Fixed selling and administrative 10
Total costs $ 90

McConnell has received a special, one-time order for 1,000 JC-46 parts. Assume that McConnell is operating at full capacity, and that the contribution of the output would be displaced by the special order is $10,000. The minimum price that is acceptable for this one-time special order must be greater than

a) $60.
b) $70.
c) $87.
d) $100.

 
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The following are relevant data for calculating sales variances for Lumber Co., which sells its sole product in two countries.

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The following are relevant data for calculating sales variances for Lumber Co., which sells its sole product in

two countries.

John Quincy Total
Budgeted selling price per unit $6.00 $10.00 NA
Budgeted variable cost per unit   3.00 7.50 NA
Budgeted contribution margin per unit $3.00 $ 2.50 NA
Budgeted unit sales 300 200 500
Budgeted mix percentage 60% 40% 100%
Actual units sold 260 260 520
Actual selling price per unit $6.00 $9.50 NA

The sales quantity variance for John and Quincy is

a) $156 U.
b) $30 F.
c) $56 F.
d) $100F.

 
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