Question

16. Which of the following is the total mixed cost equation for a factory where machine operating cos include 100.000 of machine depreciation per year, plus 570 of witty as for each day the innerati 300.000 $ar 100000 d ) $300,000 - 5701 e None of the answer choices is correct 17 Which of the following represents total variable costs? e. None of the answer choices is correct. Exhibit 5-3 Hayley Inc. is using the account analysis approach to identify the cost behavior of production costs for one month. The production manager was asked to review these costs and provide her best guess as to how they should be categorized. Hayley produced 200 units for the month. She responded with the following information. Total = Variable + Fixed Direct materials used in production $370,000 $370.000 S-0- Direct labor used in production 230,000 230.000 - - - Overhead costs 220.000 200.000 20.000 Total production costs $820,000 $800.000 $20,000 18. Refer to Exhibit 5-3. Which of the following best describes the production costs in equation form? a. Y = $20,000 - $4,000X b. 7 - $20.000+ $4,000.X c. - $800,000+ $20,000X d. y $4,100.X e. None of the answer choices is correct. 19. Refer to Exhibit 5-3. Assume Hayley intends to produce 180 units next month. Using the account analysis approach, which of the following is the correct estimate of the total production costs for the month? a $740,000 b. $720,000 c. $738,000 d. $820,000 e. None of the answer choices is correct.

Answer 1

16) Total mixed costs equation includes both fixed costs and variable costs. In the question,

Fixed costs= $300000

Variable costs= $70 per day

Total mixed cost equation= Fixed costs+Variable costs

Y= $300000+$70X

where, X= number of days

So, the answer is option A) Y= $300000+$70X

17) Variable cost per unit will remain same irrespective of the number of units but the total variable cost changes with the change in number of units. So, the total variable costs should be represented by vX

where, v= variable costs

X= Number of units

So, the answer is option B) vX

18) Variable cost per unit= Total variable cost/Number of units produced

= $800000/200= $4000 per unit

Fixed cost= $20000

Production cost equation= Variable cost+Fixed cost

Let Production cost= Y

Number of units produced= X

So, production cost equation is

Y= $4000X+$20000

So, the answer is option B) Y= $20000+$4000X

19) Units produced= 180 units

Production cost equation= Variable cost+Fixed cost

Y= $20000+$4000X

Y= $20000+$4000*180

Y= $740000

So, the answer is option A) $740000