The total cost of production for two levels of activity is as follows:The variable production cost per unit and the total fixed production cost both remain constant in the range of activity shown.What is the variable production cost per unit?
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1 .A scatter diagram shows the weekly total costs of production (USD) in a certain factory plotted against the weekly output (units). A broadly linear pattern is evident, with r = 0.9. The regression equation is: Costs = 1,500 + (15 × output).Fifty data points have been included in the analysis, with output ranging from 100 units to 1,000 units. Output next week is planned to be 500 units.Read the following statements about estimates:(1) Weekly fixed costs are approximately USD1,500.(2) Variable costs are approximately USD15 per unit on average.(3) Next week’s production costs are likely to be about USD9,000.Assuming everything happens as expected, which of these statements are true?
A 1 and 2 only B 1 and 3 only C 2 and 3 only D 1, 2 and 3
2 .Trafalgar budgets to produce 10,000 units of a product, each requiring 45 minutes of labour. Labour is charged at USD20 per hour. During March, 11,000 units were produced. 8,000 hours of labour were paid at a total cost of USD168,000.What is the labour efficiency variance for March?
A USD5,000 adverse B USD5,000 favourable C USD5,250 adverse D USD5,250 adverse
3 .The following diagram represents the behaviour of one element of cost:Which ONE of the following statements is consistent with the above diagram?
A Annual factory power cost where the electricity supplier sets a tariff based on a fixed charge plus a constant unit cost for consumption but subject to a maximum annual charge. B Weekly total labour cost when there is a fixed wage for a standard 40 hour week but overtime is paid at a premium rate....
4 .An organisation manufactures a single product. The total cost of making 4,000 units is USD20,000 and the total cost of making 20,000 units is USD40,000. Within this range of activity the total fixed costs remain unchanged.What is the variable cost per unit of the product?
A USD0.80 B USD1.20 C USD1.25 D USD2.00
5 .When total purchases of raw material exceed 30,000 units in any one period then all units purchased, including the initial 30,000, are invoiced at a lower cost per unit.Which of the following graphs is consistent with the behaviour of the total materials cost in a period?
A B C D
7 .Monthly variance reports are an example of which one of the following types of management information?
A Tactical B Strategic C Planning D Operational
8 .Which of the following statements are correct? (i) Strategic information is mainly used by senior management in an organisation.(ii) Productivity measurements are examples of tactical information.(iii) Operational information is required frequently by its main users.
A (i) and (ii) only B (i) and (iii) only C (ii) and (iii) only D (i), (ii) and (iii)
9 .The following statements refer to strategic planning:(i) It is concerned with quantifiable and qualitative matters.(ii) It is mainly undertaken by middle management in an organisation.(iii) It is concerned predominantly with the long term. Which of the statements are correct?
A (i) and (ii) only B (i) and (iii) only C (ii) and (iii) only D (i), (ii) and (iii)
