1. A manufacturing company applies factory overhead based on direct labor hours. At the beginning of the year, it estimated that factory overhead costs would be $360,000 and direct labor hours would be 45,000. Actual manufacturing overhead costs incurred were $377,200 and actual direct labor hours were 46,000 what is the predetermined overhead rate per direct labor hour?

a. 8

b 8.20

c. 8.38

d 7.83

2. Equivalent production units usually are determined for

a. direct materials and conversion costs

b. direct materials only

c. conversion costs only

d. direct materials and direct labor costs only

3. Which of the following best describes the effect on direct labor when management adopts a just in time environment?

a. workers typically perform one faction

b. the environment becomes more labor intensive

c. each employee runs a single machine

d. workers are often cross trained to perform more than one function

4. Which of the following describes the behavior of the fixed cost per unit?

a. decreaes with increasing production

b. decreases with decreasing production

c. remains constant with changes in production

d. increases with increasing production

5. Which of the following activity bases would be the most appropriate for food costs of a hospital?

a. Number of cooks scheduled to work

b. number of x-rays taken

c. number of patients who stay in the hospital

d. number of scheduled surgeries

6. Which of the following activity bases would be the most appropriate for gasoline costs of a delivery service such as USPS

a. number of trucks employed

b. number of miles driven

c. number of trucks in service

d. number of packages delivered

7. Costs that vary in total in direct proportion to changes in an activity level are called:

a. fixed costs

b. sunk costs

c. variable costs

d. differential costs

8.  Which of the following costs is a mixed cost?

a. Salary of a factory supervisor

b. electricity costs of $2 per kilowatt-hour

c. rental costs of 5000 per month plus .30 per machine hour of use

d. straight line depreciation on factory equipment

9. Marcye Co. makes office furniture. During the most productive month 3500 desks were manufactured at a total cost of $84,400. In its slowest monthe the company made 1100 desks at the cost of $46000 using the high low method of cost estimation total fixed costs are?

a. 56000

b. 28400

c. 17600

d. cannot be determined form the data given