Question

6.A volume variance occurs when the company operates at a different capacity level than was expected.

True or false

7. Canfield Technical School allocates administrative costs to its respective departments based on the number of students enrolled, while maintenance and utilities are allocated per square feet of the classrooms. Based on the information below, what is the total amount allocated to the Welding Department (rounded to the nearest dollar) if administrative costs for the school were $65,000, maintenance fees were $27,000, and utilities were $7,500?

DepartmentStudents Classrooms Electrical250 15,300 sq. ft. Welding150 20,400 sq. ft. Accounting75 10,200 sq. ft. Carpentry25 5,100 sq. ft. Total500 51,000 sq. ft.

$0.

$29,850.

$33,300.

$39,800.

$45,900.

8. Pleasant Hills Properties is developing a golf course subdivision that includes 225 home lots; 100 lots are golf course lots and will sell for $110,000 each; 125 are street frontage lots and will sell for $80,000. The developer acquired the land for $1,950,000 and spent another $1,550,000 on street and utilities improvement. Compute the amount of joint cost to be allocated to the golf course lots using value basis.

$2,128,120.

$1,834,000.

$1,887,120.

$1,531,280.

$1,666,000.

9.Ready Company has two operating (production) departments: Assembly and Painting. Assembly has 280 employees and occupies 57,600 square feet; Painting has 120 employees and occupies 38,400 square feet. Indirect factory expenses for the current period are as follows:

Administration$88,000 Maintenance$108,000

Administration is allocated based on workers in each department; maintenance is allocated based on square footage. The amount of administration expenses that should be allocated to the Painting Department for the current period is:

$61,600.

$64,800.

$126,400.

$26,400.

$129,600.

Answer 1