Exercise 2-2 (LO1 CC 1, 2; LO3 CC 5, 6; LO4 CC 10, 11) (15 minutes) 1. 2. 3. 4. 5.
Product; variable Conversion Opportunity Prime Sunk
6. 7. 8. 9. 10.
Period; variable Product; period; fixed Product Period Fixed; product; conversion
Exercise 2-3 (LO1 CC 1, 2; LO2 CC 3, 4) (15 minutes) Cost Behaviour 1. 2. 3. 4. 5. 6. 7.
Cost Item Variable Account manager’s salary ........ Rent on building ..................... Flour used in the making of croissants ............................ X Bakery manager’s salary ......... Wages of bakers ..................... X Depreciation of commercial ovens used in baking ........... Insurance on the building........
Solutions Manual, Chapter 2
14
Fixed X X
To Quantity of Baked Goods Produced Direct
Indirect X X
X X
X X
X X
X X
9
Introduction to Managerial Accounting, Fourth Canadian Edition