Classify each of the following costs for a jeans manufacturing company as a variable cost, committed fixed cost, or discretionary fixed cost.

h. Quality training for employees-typically given for 4 hours at a time, every 6 months

In applying the high-low method of cost estimation to mixed costs, how is the total fixed cost estimated?

How to calculate the variable cost using the high-low method?

Describe the three steps of the high-low method.

In using the high-low method, the fixed cost _______.

A responsibility center structure that considers investments made by the operating segments by using a common cost of capital percentage is called ________. A. return on investment B. residual income C. a profit center D. a discretionary cost center

Janine is analyzing spending habits of students in her high school. She finds a mean monthly discretionary expense of $70 spent on having meals out with friends. The standard deviation of a distribution is 5. What is the variance?

Classify each of the following costs for a jeans manufacturing company as a variable cost, committed fixed cost, or discretionary fixed cost.

e. Advertising in a national magazine for teenage girls

Classify each of the following costs for a jeans manufacturing company as a variable cost, committed fixed cost, or discretionary fixed cost.

d. The cost of landscaping and mowing the grass-the contract with a local mowing company runs from month to month

Classify each of the following costs for a jeans manufacturing company as a variable cost, committed fixed cost, or discretionary fixed cost.

c. The salary of a summer intern

Giovanni Company produced 3,500 units of product that required five standard hours per unit. The standard variable overhead cost per unit is $3.50 per hour. The actual variable factory overhead was$63,400. Determine the variable factory overhead controllable variance.

The direct material price variance can be defined as which of the following?

A. Standard price $\times$ (Actual quantity used - Standard quantity allowed)
B. Actual price $\times$ (Actual quantity used - Standard quantity allowed)
C. Standard quantity allowed $\times$ (Actual price - Standard price)
D. Actual quantity purchased $\times$ (Actual price - Standard price)

Sealing Company manufactures three types of DVD storage units. Each of the three types requires the use of a special machine that has a total operating capacity of 15,000 hours per year. Information on the three types of storage units is as follows:

$$\begin{array}{lrcr} & \text { Basic } & \text { Standard } & \text { Deluxe } \\ \hline \text { Selling price } & \$ 9.00 & \$ 30.00 & \$ 35.00 \\ \text { Variable cost } & \$ 6.00 & \$ 20.00 & \$ 10.00 \\ \text { Machine hours required } & 0.10 & 0.50 & 0.75 \end{array}$$

Sealing’s marketing director has assessed demand for the three types of storage units and believes that the firm can sell as many units as it can produce.

1. How many of each type of unit should be produced and sold to maximize the company’s contribution margin? What is the total contribution margin for your selection?

2. Now suppose that Sealing Company believes that it can sell no more than 12,000 of the deluxe model but up to 50,000 each of the basic and standard models at the selling prices estimated. What product mix would you recommend, and what would be the total contribution margin?

Rianne Company produces a light fixture with the following unit cost:

$$\begin{array}{lr} \text { Direct materials } & \$ 2 \\ \text { Direct labor } & 1 \\ \text { Variable overhead } & 3 \\ \text { Fixed overhead } & \underline{2} \\ \quad \text { Unit cost } & \underline{\underline{\$ 8}} \end{array}$$

The production capacity is 300,000 units per year. Because of a depressed housing market, the company expects to produce only 180,000 fixtures for the coming year. The company also has fixed selling costs totaling $500,000 per year and variable selling costs of$1 per unit sold. The fixtures normally sell for $12 each.

At the beginning of the year, a customer from a geographic region outside the area normally served by the company offered to buy 100,000 fixtures for$7 each. The customer also offered to pay all transportation costs. Since there would be no sales commissions involved, this order would not have any variable selling costs.

1. Based on a quantitative (numerical) analysis, should the company accept the order?

2. What qualitative factors might impact the decision? Assume that no other orders are expected beyond the regular business and the special order.