Business Finance - Management QSO 355 Homework ( week 8)
malshaghathirah
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Back to 'Saylor Direct Credit\'
Started on Wednesday, July 20, 2022, 4:34 PM State Finished
Completed on Wednesday, July 20, 2022, 5:38 PM Time taken 1 hour 3 mins
Points 12.00/50.00 Grade 2.40 out of 10.00 (24%)
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Question 1 Correct
1.00 points out of 1.00
Use the following relevant data to assign costs to units transferred out and units in ending WIP inventory.
Total Units Accounted For:
Equivalent Units
Physical Units
Direct Materials
Direct Labor
Overhead
Units completed and transferred out 400 400 400 400
Units in ending WIP inventory 300 250 275 200
Total units accounted for 700 650 675 600
Cost per Equivalent Unit:
Direct Materials Direct Labor Overhead Total
$2.50 $1.00 $2.00 $5.50
What is the total cost of production?
a. $3,300
b. $3,500
c. $3,575
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Question 2 Incorrect
0.00 points out of 1.00
d. $3,850
Your answer is correct.
SJ candles should expect 4th quarter operating profits under the absorption method to be lower than using the variable costing method under which of the following scenarios?
a. They started the 4th quarter with no inventory and every candle that was produced in the 4th quarter also sold
b. They started the 4th quarter with no inventory and sold 25% of the candles that were produced in the 4th quarter
c. Their 4th quarter sales included every candle produced in the 4th quarter as well as a few that remained in inventory from the 3rd quarter
d. Their 4th quarter sales were the result of selling 45,000 candles produced in 4th quarter, and reporting 55,000 candles as finished goods inventory at the close of the quarter
Your answer is incorrect.
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Question 3 Incorrect
0.00 points out of 1.00
The manager of Ladron Candies is deciding whether or not to invest in new equipment with a purchase price of $10,500 and a required rate of return of 7%. Given this calculation of the present value of cash inflows and outflows for the next three years, what should he decide, based on the internal rate of return?
6% 7% 8%
Present value of purchase price
$ (10,500) $ (10,500) $ (10,500)
Present value of labor savings
10,692.04 10,497.28 10,308.40
Net present value 192.04 (2.72) (191.60)
a. Reject the investment, because the internal rate of return cannot be determined with the information given
b. Reject the investment, because the internal rate of return is approximately 7% and results in a loss after three years
c. Accept the investment, because the internal rate of return is approximately 6% and results in a profit after three years
d. Accept the investment, because the internal rate of return is approximately 7% which equals the required rate of return
Your answer is incorrect.
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Question 4 Correct
1.00 points out of 1.00
Ladron Candies is analyzing sales and production data for the holiday boxes they produced last year. The company expected to use 2 pounds of direct materials to produce one box of specialty candy at a cost of $3.00 per pound. Invoices show the company purchased 1,650,000 pounds of direct materials at $2.90 per pound and used 1,580,000 pounds in production. They sold 800,000 boxes of candy to retailers. What is the materials quantity variance?
a. $(60,000) favorable materials quantity variance
b. $(60,000) unfavorable materials quantity variance
c. $(165,000) favorable materials quantity variance
d. $(165,000) unfavorable materials quantity variance
Your answer is correct.
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Question 5 Correct
1.00 points out of 1.00
Diamonds and More produced a new line of necklaces that sell for $350 each. Management requires a profit equal to 40 percent of the selling price. What is the target cost of this product?
a. $140
b. $175
c. $210
d. $350
Your answer is correct.
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Question 6 Incorrect
0.00 points out of 1.00
Which of the following employees of ABC Corporation is most likely to receive the report regarding the internal audit committee's control findings?
a. Payroll clerk
b. Plant manager
c. Chief financial officer
d. Managerial accountant
Your answer is incorrect.
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Question 7 Incorrect
0.00 points out of 1.00
Wycliff Corporation manufactures several different styles of bicycles. Managers appropriately record direct materials and direct labor into work-in process accounts during production. To apply manufacturing overhead, managers consider cost pools for assembly and shipping to calculate a predetermined overhead rate for each department. Which of the following best describes the method used by Wycliff Corporation for allocating manufacturing overhead costs?
a. Activity-based
b. Departmental
c. Plantwide
d. Process
Your answer is incorrect.
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Question 8 Incorrect
0.00 points out of 1.00
The accounting department for Aramai Inc. is preparing the cash flow statement for the current year. Using the select financial statement data below, what is Aramai's net income when converted to cash provided by operating activities, using the indirect method?
Net income $463,000
Equipment depreciation 38,500
Patent amortization 17,950
Loss on sale of equipment 4,000
Increase in accounts receivable 29,900
a. $380,650
b. $493,550
c. $553,350
d. $545,350
Your answer is incorrect.
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Question 9 Incorrect
0.00 points out of 1.00
Under which of the following scenarios would a manufacturer benefit from decentralized operations?
a. The company sells their products to twenty local retailers
b. The company plans to decrease their number of product lines
c. The company has recently acquired a manufacturing firm in Canada
d. The company is merging two departments to reduce payroll expenses
Your answer is incorrect.
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Question 10 Incorrect
0.00 points out of 1.00
Swinney Services reported $102,300 in net sales revenue for year 2, and 90% of those sales were credit sales. This is the balance sheet for Swinney Services. What is the accounts receivable turnover ratio for year 2?
Year 2 Year 1
Current assets
Cash 14,490 11,250
Accounts receivable (net) 9,600 9,000
Inventory 2,125 1,400
Total Current Assets 26,215 21,650
Property, Plant, & Equipment
Equipment (net) 19,350 13,900
Total Assets $45,565 $35,550
Current Liabilities
Accounts payable 6,500 6,250
Wages payable 755 755
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Total Current Liabilities 7,255 7,005
Note payable 12,100 11,600
Total Liabilities $19,355 $18,605
Shareholders' Equity
Common Stock 5,575 4,990
Retained Earnings 20,635 11,955
Total Liabilities & Shareholders Equity $45,565 $35,550
a. 4.6
b. 9.9
c. 10.7
d. 11.0
Your answer is incorrect.
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Question 11 Incorrect
0.00 points out of 1.00
Which of the following statements best exemplifies an ethical dilemma a manager might face when making long-term investment decisions?
a. Rachel was asked to approve the purchase of new equipment. The rate of return exceeds the hurdle rate
b. Diego is deciding whether or not to approve the purchase of new equipment. The net present value of the discounted cash flows equals zero
c. Sarah is deciding whether or not her company should invest in additional equipment. The rate of return for the equipment is lower than the cost of capital
d. Ignacio is deciding whether or not to purchase new equipment. His bonus is calculated as a percentage of the increase in net income from year 1 to year 2
Your answer is incorrect.
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Question 12 Incorrect
0.00 points out of 1.00
Ladron Candies uses activity based costing to allocate variable factory overhead costs. Which of the following statements best represents the excerpted activity data for indirect materials?
Indirect Materials:
Actual Variable Overhead Cost Actual Quantity at Standard Rate Standard Variable Overhead Cost (Flexible Budget)
$85,000 $81,000 $82,000
a. There is a $1,000 favorable efficiency variance
b. There is a $4,000 favorable efficiency variance
c. There is a $1,000 unfavorable efficiency variance
d. There is a $4,000 unfavorable spending variance
Your answer is incorrect.
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Question 13 Incorrect
0.00 points out of 1.00
What is the present value of $2,500 to be received in five years, assuming an interest rate of 10% and a present value factor of 0.6209?
a. $250.00
b. $776.12
c. $1,250.00
d. $1,552.25
Your answer is incorrect.
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Question 14 Incorrect
0.00 points out of 1.00
When companies practice management by exception, which of the following do they do?
a. Recognize exceptional employees on a regular basis
b. Use specific accounting software for account management
c. Perform sensitivity analysis in a variety of what-if scenarios
d. Establish criteria for investigating material, labor, and overhead variances
Your answer is incorrect.
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Question 15 Correct
1.00 points out of 1.00
Wycliff Corp. had an immaterial credit balance of $1,250 in the manufacturing overhead account after $21,750 was applied to the WIP inventory account. To close the manufacturing overhead account at the end of the period, assuming no further transactions took place, what should Wycliff do?
a. Debit manufacturing overhead $1,250; credit cost of goods sold $1,250
b. Debit cost of goods sold $1,250; credit manufacturing overhead $1,250
c. Debit manufacturing overhead $20,500; credit cost of goods sold $20,500
d. Debit cost of goods sold $20,500; credit manufacturing overhead $20,500
Your answer is correct.
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Question 16 Incorrect
0.00 points out of 1.00
Martinez Company is deciding between two lease options for a new copier. Which of the following options should they choose if they want to save the most money on an annual basis, and how much money will they save? They anticipate making 30,000 copies spread evenly over the course of the year. Option 1: Monthly lease of $350 that includes 2,400 copies per month. Additional copies per month cost $0.15 per copy. Option 2: Monthly lease of $399 that includes 2,100 copies per month. Additional copies per month cost $0.03 per copy.
a. Option 1; $588 annual savings
b. Option 1; $552 annual savings
c. Option 2; $36 annual savings
d. Option 2; $3,600 annual savings
Your answer is incorrect.
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Question 17 Correct
1.00 points out of 1.00
Allen Manufacturing performed an account analysis of production costs for the month of April. Their fixed and variable costs for 200 units were categorized as:
Total Variable Fixed
# manufactured 200 units
Material costs $430,000 $430,000 $0
Labor costs 215,000 200,000 15,000
Overhead costs 160,000 100,000 60,000
Total production costs $805,000 $730,000 $75,000
Using the appropriate cost equation, what were the total production costs for May, assuming Allen Manufacturing intends to manufacture 225 units?
a. $805,000
b. $814,375
c. $896,250
d. $905,625
Your answer is correct.
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Question 18 Incorrect
0.00 points out of 1.00
What is the correct formula when calculating the net present value of an investment?
a. After tax cash revenues - after tax cash expenses + depreciation tax savings x PV factor = net present value of cash flow
b. After tax cash revenues - after tax cash expenses - depreciation tax savings x PV factor = net present value of cash flow
c. After tax cash revenues + after tax cash expenses - depreciation tax savings x PV factor = net present value of cash flow
d. After tax cash revenues + after tax cash expenses + depreciation tax savings x PV factor = net present value of cash flow
Your answer is incorrect.
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Question 19 Incorrect
0.00 points out of 1.00
Bright Corporation reported cash provided by operating activities in the amount of $80,000. Use the following excerpted information from Bright Corporation’s balance sheet to calculate their operating cash flow ratio.
Accounts payable $18,000
Income taxes payable 12,000
Long-term debt 40,000
Common stock 490,000
Treasury stock 10,000
Retained earnings 766,000
a. 0.9
b. 1.1
c. 1.4
d. 2.7
Your answer is incorrect.
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Question 20 Correct
1.00 points out of 1.00
Wycliff Corporation manufactured Job #3 during the month of May. On May 29, 100% of the product was finished and sold on account for $150. These journal entries were recorded during production:
Debit Credit
Manufacturing overhead 31
Materials 10
Wages payable 21
Work in process 19
Materials 19
Work in process 26
Wages payable 26
Work in process 30
Manufacturing overhead 30
Finished goods 75
Work in process 75
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Question 21 Correct
1.00 points out of 1.00
On May 31, Wycliff determined that the amount remaining in the manufacturing overhead account was immaterial and closed it out. What was the amount of gross profit before closing the manufacturing account, and what effect did closing the manufacturing account have on gross profit?
a. Gross profit was $44; gross profit decreased by $1.00 after closing manufacturing overhead
b. Gross profit was $44; gross profit increased by $1.00 after closing manufacturing overhead
c. Gross profit was $75; gross profit decreased by $1.00 after closing manufacturing overhead
d. Gross profit was $75; gross profit increased by $1.00 after closing manufacturing overhead
Your answer is correct.
Careful production planning for a company with limited labor or machine hours would most likely include which of the following?
a. A preparation of the statement of cash flows
b. A calculation of equivalent units for direct labor and direct materials
c. A calculation of the contribution margin per unit of constrained resources
d. Comparing actual selling and administrative expenses to the budgeted amount
Your answer is correct.
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Question 22 Incorrect
0.00 points out of 1.00
Which of the following statements is a true statement about flexible budgets?
a. The actual number of units sold is irrelevant to a flexible budget
b. Cost variance analysis is an integral part of preparing a flexible budget
c. Selling and administrative expenses are reported in the flexible budget
d. The flexible budget is prepared before the master budget to assist with planning
Your answer is incorrect.
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Question 23 Incorrect
0.00 points out of 1.00
This is select financial statement data for the three divisions of Technology Goods, Inc. Assuming all assets are operating assets, what is the return on investment for each division?
Computers Division
Televisions Division
Tablets Division
Average accounts payable 42,000 36,000 39,500
Average current liabilities 590 3,700 1,400
Average cash 65,000 48,500 53,000
Average accounts receivable 16,000 11,800 13,600
Average property, plant, and equipment
90,350 75,500 82,800
Average inventory 24,750 19,000 20,440
Operating income 35,000 15,500 27,000
a. 17.8%, 10.0%, 15.9%
b. 33.1%, 31.3%, 31.2%
c. 53.8%, 32.0%, 50.9%
d. 82.2%, 39.0%, 66.0%
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Your answer is incorrect.
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Question 24 Incorrect
0.00 points out of 1.00
SJ Candles is performing a cost-volume-profit analysis to prepare for year 2. Fixed costs are expected to remain the same as year 1, but variable costs per unit are expected to increase by 10%. They plan to keep the same sales price but they're nervous about the increase in variable costs and want to know what to expect. Apply the anticipated change in variable costs to an analysis of year 1. How many units will SJ Candles have to sell in year 2 to make the same operating profit?
SJ Candles
Contribution Margin Income Statement
Year 1
Sales (25,700 units) $385,500
Less Total Variable Costs 128,500
Contribution Margin $257,000
Less Total Fixed Costs 181,500
Operating Profit $75,500
a. 25,700 units
b. 27,053 units
c. 28,270 units
d. 29,983 units
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Your answer is incorrect.
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Question 25 Incorrect
0.00 points out of 1.00
Valley Manufacturing uses a process costing system. Which of the following journal entries would correctly record $3,180 of manufacturing overhead to the assembly department?
a.
Debit Credit
Manufacturing overhead 3,180
Work in process - assembly 3,180
b.
Debit Credit
Work in process - assembly 3,180
Manufacturing overhead 3,180
c.
Debit Credit
Work in process - assembly 3,180
Wages payable 3,180
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Question 26 Correct
1.00 points out of 1.00
d.
Debit Credit
Work in process - wages payable 3,180
Work in process - assembly 3,180
Your answer is incorrect.
Which of the following should be treated as direct labor costs for an auto parts manufacturer?
a. On-site security guards
b. Production supervisors
c. Welders who fuse two metal parts together
d. Quality control staff members who inspect all finished goods
Your answer is correct.
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Question 27 Incorrect
0.00 points out of 1.00
Mattis Restaurants has applied for a loan. The creditor would like some assurance that Mattis Restaurants derives a majority of their cash from their daily operations. Which of the following financial statements is the best one to provide that assurance?
a. Balance sheet
b. Income statement
c. Statement of cash flows
d. Statement of owners' equity
Your answer is incorrect.
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Question 28 Incorrect
0.00 points out of 1.00
Using this data, what is the number of units that must be sold in order to achieve a desired after-tax profit of $50,000?
Fixed costs $36,000
Selling price per unit 11.00
Variable cost per unit 6.00
Tax rate 20%
a. 13,760 units
b. 17,200 units
c. 19,700 units
d. 24,625 units
Your answer is incorrect.
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Question 29 Incorrect
0.00 points out of 1.00
Which of the following would be a measure of managerial accounting?
a. Profit margin for each type of product
b. Net income at the end of the 2nd quarter
c. A report on the company's beneficial ownership
d. Assets, liabilities, and shareholders' equity as of December 31
Your answer is incorrect.
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Question 30 Correct
1.00 points out of 1.00
This is the balance sheet for Swinney Services. Using trend analysis, what does this information tell us about the trends for current assets and current liabilities?
Year 2 Year 1
Current assets
Cash 14,490 11,250
Accounts receivable (net) 9,600 9,000
Inventory 2,125 1,400
Total Current Assets 26,215 21,650
Property, Plant, & Equipment
Equipment (net) 19,350 13,900
Total Assets $45,565 $35,550
Current Liabilities
Accounts payable 6,500 6,250
Wages payable 755 755
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Total Current Liabilities 7,255 7,005
Note payable 12,100 11,600
Total Liabilities $19,355 $18,605
Shareholders' Equity
Common Stock 5,575 4,990
Retained Earnings 20,635 11,955
Total Liabilities & Shareholders Equity $45,565 $35,550
a. Current assets increased at a rate nearly 2x higher than current liabilities
b. Current assets increased at a rate nearly 4x higher than current liabilities
c. Current assets increased at a rate nearly 6x higher than current liabilities
d. Current assets increased at a rate nearly 10x higher than current liabilities
Your answer is correct.
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Question 31 Incorrect
0.00 points out of 1.00
Wycliff Corporation practices activity-based management at their manufacturing facility. Which of the following events would most likely be the result of a decision made using activity-based management theory?
a. Direct labor costs were assigned to work-in-process accounts
b. Customer service representatives responded to vendor complains
c. Plant managers assisted in calculating a plant-wide overhead rate
d. The packaging department was moved closer to the shipping department
Your answer is incorrect.
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Question 32 Incorrect
0.00 points out of 1.00
Which of the following might be included as part of a capital expenditures budget?
a. Office supplies
b. Direct materials
c. Plant equipment
d. Foreign exchange rate
Your answer is incorrect.
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Question 33 Incorrect
0.00 points out of 1.00
This is select financial statement data for Binks Corporation. What is the inventory turnover ratio for year 2?
Sales $2,335,000
Cost of Goods Sold 1,525,000
Gross Profit 810,000
Ending inventory, year 1 300,000
Ending inventory, year 2 350,000
Accounts Payable 160,000
a. 2.3
b. 4.4
c. 4.7
d. 7.2
Your answer is incorrect.
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Question 34 Incorrect
0.00 points out of 1.00
Ladron Candies typically manufactures between 1,500 and 3,000 units per month. Which of the following statements best describes the situation if they receive orders for 4,000 units in a single month?
a. The order is within the relevant range; therefore, linear costs are predictable
b. The order is within the relevant range; therefore, linear costs are not predictable
c. The order is outside of the relevant range;, therefore, linear costs are predictable
d. The order is outside of the relevant range; therefore, linear costs are not predictable
Your answer is incorrect.
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Question 35 Incorrect
0.00 points out of 1.00
Which of the following activities would be performed by a company that utilizes process order costing instead of job order costing?
a. Track costs with a cost sheet
b. Assign costs to unique products
c. Maintain a single work-in-process account during a production run
d. Calculate equivalent units of production for beginning and ending inventory
Your answer is incorrect.
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Question 36 Incorrect
0.00 points out of 1.00
The operating activities section of the statement of cash flows would answer which of the following questions?
a. How much cash was generated from the sale of our land?
b. How much cash was generated from our issuance of bonds?
c. How much cash did we generate as a result of normal operations?
d. How much cash did we pay for our investment in Pamplona Corp?
Your answer is incorrect.
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Question 37 Incorrect
0.00 points out of 1.00
Cat Hats Inc. produces lines of headwear for cats. They have been asked by a local animal shelter to produce a special order for dogs. Below is a special order differential analysis prepared by their managerial accountant. Using this information, what would be the result of accepting the special order?
Alternative 1
(reject special order)
Alternative 2
(accept special order)
Sales revenue 12,000 15,500
Variable costs 4,200 7,000
Fixed costs 1,500 2,750
a. A differential profit of ($550)
b. A differential profit of ($700)
c. A differential contribution margin of $550
d. A differential contribution margin of $700
Your answer is incorrect.
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Question 38 Correct
1.00 points out of 1.00
You are the newly hired manager of an individual restaurant chain. Which of the following responsibilities for your responsibility center would you be evaluated on?
a. Meeting cost budgets
b. Investments in assets decisions
c. Revenues, costs, and resulting profits
d. Return on investment for shareholders
Your answer is correct.
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Question 39 Incorrect
0.00 points out of 1.00
Ladron Candies implemented changes that were designed to increase efficiency between several departments at their company headquarters. As a result, they experienced a favorable 10% decrease in customer response time. Which of the following perspectives of their balanced scorecard is most likely to include this measure?
a. Learning and growth
b. Customer satisfaction
c. Financial performance
d. Internal business process
Your answer is incorrect.
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Question 40 Incorrect
0.00 points out of 1.00
These tables pertain to the blending department of Martinez Corporation, a paint manufacturer, for the month of August. Units accounted for in the mixing department:
Equivalent Units
Physical Units
Direct Materials
Direct Labor
Overhead
Units completed and transferred to the packaging department during August
350 350 350 350
Work in process inventory, August 31 600 570 500 275
Total units accounted for 950 920 850 625
Total costs to be accounted for in the mixing department:
Direct Materials
Direct Labor
Overhead Total Cost
$25,975 $11,900 $14,375 $52,250
What is the cost per equivalent unit for overhead, and what is the cost of overhead to be assigned to ending work in process inventory?
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Question 41 Incorrect
0.00 points out of 1.00
a. $23 per equivalent unit; $6,325 overhead cost assigned to ending WIP inventory
b. $23 per equivalent unit; $13,800 overhead cost assigned to ending WIP inventory
c. $55 per equivalent unit; $15,125 overhead cost assigned to ending WIP inventory
d. $55 per equivalent unit; $33,000 overhead cost assigned to ending WIP inventory
Your answer is incorrect.
The CFO of a small business consulting firm would like to assess the company's accounting trends over the past three years. How could they utilize software?
a. Upgrade their accounting system by purchasing an enterprise resource planning system
b. Enter the data from their accounting system into Microsoft Excel and organizing it by year
c. Export data from their annual reports into Microsoft Excel and creating year-over-year comparison line graphs
d. Download payroll expense reports from their accounting system and identifying which employees received the highest consulting fees
Your answer is incorrect.
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Question 42 Incorrect
0.00 points out of 1.00
Why do most manufacturing companies prefer normal costing?
a. It doesn't require managers to determine the cost driver for an allocation base
b. Using a predetermined overhead rate helps to average costs that normally fluctuate
c. Accountants record the actual cost of overhead directly to the WIP inventory account
d. It always results in a lower cost of goods sold due to lower overall manufacturing costs
Your answer is incorrect.
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Question 43 Incorrect
0.00 points out of 1.00
SJ Candles is performing a cost-volume-profit analysis to prepare for year 2. They anticipate fixed costs in the amount of $147,500. Their candles sell for $16 each with a cost of $4.00 each to produce. What amount of sales dollars is necessary to profit $40,000?
a. $107,500
b. $187,500
c. $242,000
d. $250,000
Your answer is incorrect.
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Question 44 Incorrect
0.00 points out of 1.00
Ladron Candies is analyzing sales and production data for the holiday boxes they produced last year. The company expected to use 2 pounds of direct materials to produce one box of specialty candy at a cost of $3.00 per pound. Invoices show the company purchased 1,650,000 pounds of direct materials at $2.90 per pound and used 1,580,000 pounds in production. They sold 800,000 boxes of candy to retailers. What is the materials price variance?
a. $(60,000) favorable materials price variance
b. $(60,000) unfavorable materials price variance
c. $(165,000) favorable materials price variance
d. $(165,000) unfavorable materials price variance
Your answer is incorrect.
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Question 45 Incorrect
0.00 points out of 1.00
Archer Corporation manufactures coffee cups in the Midwest. Using this data, calculate the total current period manufacturing costs for the Schedule of Cost of Goods Manufactured for the year ending on December 31, 2021.
December 31, 2020 December 31, 2019
Raw materials inventory $ 5,000 $ 9,000
Work-in-process inventory 375,000 300,000
Finished goods inventory 250,000 225,000
Selling $ 75,000
General and administrative 250,000
Raw materials purchases 150,000
Direct labor used in production 50,000
Manufacturing overhead applied 400,000
a. $554,000
b. $604,000
c. $679,000
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d. $925,000
Your answer is incorrect.
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Question 46 Incorrect
0.00 points out of 1.00
Using this data, what is the contribution margin?
Sales $1,025,800
Cost of goods sold
Variable: $232,800
Fixed: $280,100
Selling & Administrative Expenses
Variable: $110,520
Fixed $197,220
a. $205,160
b. $512,900
c. $548,480
d. $682,480
Your answer is incorrect.
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Question 47 Correct
1.00 points out of 1.00
Competence, confidentiality, integrity, and credibility are the four standards of which of the following?
a. Internal Revenue Service
b. Securities Exchange Commission
c. Financial Industry Regulatory Authority
d. IMA Statement of Ethical Professional Practice
Your answer is correct.
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Question 48 Incorrect
0.00 points out of 1.00
When would segmented net income be a misleading measure in comparing the performances of a retail store's two locations?
a. When both stores sell the same types of products
b. When the two store locations are in different states
c. When the two store locations have similar annual sales revenue
d. When Division A has invested considerably more in assets than Division B
Your answer is incorrect.
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Question 49 Correct
1.00 points out of 1.00
Cat Hats Inc. produces headwear for cats. This year, they are considering dropping one of their customers in order to save on costs. Below is the differential analysis prepared by their managerial accountant. Should they drop one of their customers?
Alternative 1 (keep all customers) Alternative 2
(drop Customer A)
Alternative 3
(drop Customer B)
Alternative 4
(drop Customer C)
Sales revenue $95,000 $90,000 $73,000 $86,750
Variable costs 70,000 69,000 55,000 65,600
Fixed costs 10,000 9,000 2,500 7,000
a. Yes, they should drop Customer A
b. Yes, they should drop Customer B
c. Yes, they should drop Customer C
d. No, they should keep all customers
Your answer is correct.
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Question 50 Incorrect
0.00 points out of 1.00
Which of the following items would a production manager most likely use as resources to establish the standard cost per unit for direct materials?
a. Engineering specs and payroll records
b. A recipe book and a purchase contract
c. Historical quantities and the average cost of wages
d. Employee time sheets with breaks and a log of machine downtime
Your answer is incorrect.
