5. Glass Industries reported the following data for the year just ended: sales r

Question

5. Glass Industries reported the following data for the year just ended: sales revenue, $1,750,000; cost of goods sold, $980,000; cost of goods manufactured, $560,000; and selling and administrative expenses, $170,000. Glass' gross margin would be:
A. $940,000.
B. $1,190,000.
C. $1,020,000.
D. $380,000.
E. $770,000.

6. Which of the following is an example of a fixed cost?
A. Paper used in the manufacture of textbooks.
B. Property taxes paid by a firm to the City of Los Angeles.
C. The wages of part-time workers who are paid $8 per hour.
D. Gasoline consumed by salespersons' cars.
E. Surgical supplies used in a hospital's operating room.

7. As production takes place, all manufacturing costs are added to the:
A. Work-in-Process Inventory account.
B. Manufacturing-Overhead Inventory account.
C. Cost-of-Goods-Sold account.
D. Finished-Goods Inventory account.
E. Production Labor account.

8. Under- or overapplied manufacturing overhead at year-end is most commonly:
A. charged or credited to Work-in-Process Inventory.
B. charged or credited to Cost of Goods Sold.
C. charged or credited to a special loss account.
D. prorated among Work-in-Process Inventory, Finished-Goods Inventory, and Cost of Goods Sold.
E. ignored because there is no effect on the Cash account

9. The division of activities into unit-level, batch-level, product-sustaining level, and facility-level categories is commonly known as a cost:
A. object.
B. application method.
C. hierarchy.
D. estimation method.
E. classification scheme that is useful in traditional, volume-based systems.

10. When a company adopts a just-in-time inventory system, it would expect:
A. higher inventories and less frequent purchases.
B. higher inventories and more frequent purchases.
C. lower inventories and less frequent purchases.
D. lower inventories and more frequent purchases.
E. lower inventories and more units purchased on a given order.

Explanation / Answer

Solution:

5)

Gross Margin is the difference between Net Sales Revenue and Cost of Goods Sold

Mathematically it is calculated as follows:

Gross Margin = Net Sales – Cost of Goods Sold = 1,750,000 – 980,000 = $770,000

Hence, the correct option is E. $770,000

6)

Correct option is B. Property taxes paid by a firm to the City of Los Angeles.

Property taxes does not vary with the production. It is a example of fixed cost.

Hope the above calculations, working and explanations are clear to you and help you in understanding the concept of question.... please rate my answer...in case any doubt, post a comment and I will try to resolve the doubt ASAP…thank you

Pls ask separate question for remaining part.

Related Questions

Navigate

• Browse (All)
• Browse 5
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.