Service departments provide functional tasks for which of the following?
A. no no
B. yes no
C. no yes
D. yes yes
Budgeted sales for the first six months for Pratt Company are listed below:
Pratt Company has a policy of maintaining an inventory of finished goods equal to 30
percent of the next month’s budgeted sales. If Pratt Company plans to produce 8,000
units in June, what are budgeted sales for July?
A. 3,000 units
B. 4,500 units
C. 10,000 units
D. 15,000 units
In a normal cost system, a debit to Work in Process Inventory would not be made for
A. actual overhead.
B. applied overhead.
C. actual direct material.
D. actual direct labor.
Expatriate employees
A. should be paid a base comparable to what he/she was earning domestically.
B. will be paid more than corresponding managers in their home country.
C. will always pay taxes in the country in which they are based.
D. should receive retirement benefits based on local currencies.
EMS has to do with handling
A. pollution.
B. manufacturing.
C. scrap.
D. by-products.
Savannah Motors
Savannah Motors is trying to decide whether it should keep its existing car washing
machine or purchase a new one that has technological advantages (which translate into
cost savings) over the existing machine. Information on each machine follows:
Refer to Savannah Motors. The $4,000 of annual operating costs that are common to
both the old and the new machine are an example of a(n)
A. sunk cost.
B. irrelevant cost.
C. future avoidable cost.
D. opportunity cost.
A value chart should include which of the following?
A. yes no yes
B. no no yes
C. yes yes no
D. yes yes yes
Which of the following attributes is a characteristic of the Internet business model?
A. many physical assets
B. complex interrelationships among members of management
C. a direct pipeline to customers
D. one-to-one relationships between a company and its principal vendors.
Abnormal spoilage can be
A. yes no
B. no no
C. yes yes
D. no yes
The set of processes that convert inputs into services and products that consumers use
is called
A. a core competency.
B. an operational plan.
C. the value chain.
D. the product life cycle.
Assume that X represents a sum of money that Bill has available to invest in a project
that will yield a return of r. In the formula Y = X(1 + r), Y represents the
A. future value of X in one period.
B. future value interest factor associated with r.
C. present value of X.
D. present value interest factor associated with r.
Kempf Corporation faces a marginal tax rate of 35 percent. One project that is
currently under evaluation has a cash flow in the fourth year of its life that has a present
value of $10,000 (after-tax). Kempf Corporation assumes that all cash flows occur at
the end of the year and the company uses 11 percent as its discount rate. What is the
pre-tax amount of the cash flow in year 4? (Round to the nearest dollar.) Present value
tables or a financial calculator are required.
A. $15,181
B. $23,356
C. $ 9,868
D. $43,375
Process quality yield reflects the proportion of
A. good units to bad units.
B. time required to produce a good unit.
C. total units manufactured that are good.
D. total time spent to time available.
A purpose of standard costing is to
A. replace budgets and budgeting.
B. simplify costing procedures.
C. eliminate the need for actual costing for external reporting purposes.
D. eliminate the need to account for year-end underapplied or overapplied
manufacturing overhead.
The Appliance Division
The Appliance Division of Electrotech Corporation reported the following results for a
recent year
Refer to the Appliance Division
What was the profit margin for The Appliance Division?
A. 17%
B. 24%
C. 25%
D. 69%
Total actual overhead minus total budgeted overhead at the actual input production
level equals the
A. variable overhead spending variance.
B. total overhead efficiency variance.
C. total overhead spending variance.
D. total overhead volume variance.
A firm presently has total sales of $100,000. If its sales rise, its
A. net income based on variable costing will go up more than its net income based on
absorption costing.
B. net income based on absorption costing will go up more than its net income based on
variable costing.
C. fixed costs will also rise.
D. per unit variable costs will rise.
A change in the discount rate used to evaluate a specific project will affect the project’s
A. life.
B. payback period.
C. net present value.
D. total cash flows.