Acct 526 Study Guide Rated A+

Rent on factory equipment. {Ans: Manufacturing overhead}Clear Springs Bottling Company produces a soft drink that is sold for a dollar. The company pays $400,000 in production costs, of which $260,000 are variable production costs. General, selling and administrative costs amount to $290,000 of which $90,000 are variable costs. Assuming production and sales of 800,000 units, what is the amount of contribution margin per unit? {Ans: 0.5625}Cinder Block Industries currently produces and sells 20,000 units of product at a selling price of $10. The product has variable costs of $4 per unit and a fixed cost of $50,000. The company currently earns a total contribution margin of {Ans: 120,000}The work of factory employees that can be physically and conveniently associated with converting raw materials into finished goods. {Ans: Direct Labor}Work of factory employees that has no physical association with the finished product, or it is impractical to trace the costs to the goods produced. {Ans: Indirect labor}Financial and managerial accounting are similar in that both: {Ans: deal with the economic events of an enterprise.}