Questions from Cost Accounting


Q: Ariba Corporation reaches its breakeven point at $3,200,

Ariba Corporation reaches its breakeven point at $3,200,000 of revenues. At present, it is selling 105,000 units and its variable costs are $30. Fixed manufacturing costs, administrative costs, and ma...

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Q: Space Infonautics’ senior vice president of marketing prepared his budget at the

Space Infonautics’ senior vice president of marketing prepared his budget at the beginning of the third quarter assuming a 25% market share based on total sales. Star Research estimated that the total...

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Q: The Robin’s Basket operates a chain of Italian gelato stores. Although

The Robin’s Basket operates a chain of Italian gelato stores. Although the Robin’s Basket charges customers the same price for all flavors, production costs vary, d...

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Q: The Robin’s Basket’s senior vice president of marketing prepared her budget at

The Robin’s Basket’s senior vice president of marketing prepared her budget at the beginning of the third quarter assuming a 10% market share based on a budgeted market size of 1,000,000 pints in Augu...

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Q: Henry Jackson, the new controller of United Manufacturing Company (UMC

Henry Jackson, the new controller of United Manufacturing Company (UMC) believes that the company should use the dual rate method of allocating overhead costs of its Materials Management Department to...

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Q: Yang Inc. produces and sells DVDs to businesspeople and students who

Yang Inc. produces and sells DVDs to businesspeople and students who are plan- ning extended stays in China. It has been very successful with two DVDs: Beginning Mandarin and Conversational Mandarin....

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Q: Baker University completed construction of its newest administrative building at the end

Baker University completed construction of its newest administrative building at the end of 2019. The University’s first employees moved into the building on January 1, 2020. The bui...

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Q: The Central Valley Company has prepared department overhead budgets for budgeted-

The Central Valley Company has prepared department overhead budgets for budgeted-volume levels before allocations as follows: Management has decided that the most appropriate inventory costs are achie...

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Q: The Milton Company has two products. Product 1 is manufactured entirely

The Milton Company has two products. Product 1 is manufactured entirely in department X. Product 2 is manufactured entirely in department Y. To produce these two products, the Milton Company has two s...

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Q: Ema Inc. and Gold Inc. are two small clothing companies

Ema Inc. and Gold Inc. are two small clothing companies that are considering leasing a dyeing machine together. The companies estimated that in order to meet production, Ema needs the machine for 600...

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