Which of the following is activity for which cost-volume-profit analysis would not
provide useful data?
A.product pricing.
B.market research for product distribution.
C.reporting on income tax returns.
D.assessing the level of labor needed in the production process.
Which of the following best determines the amount of accounting information that is
generated for managerial purposes and effective communication between accountants
and users?
A.bandwidth capabilities
B.cost-benefit analysis
C.web hosting
D.just-in-time analysis
Which of the following reflects the correct order in a value-chain?
A.Research & Development, Design, Production
B.Distribution, Customer Service, Marketing
C.Design, Research & Development, Production
D.Distribution, Marketing, Research & Development
Estimating flexible selling expense budget and computing sales volume variance.
Miami Products estimates that it will incur the following selling expenses next period:
Required:
a. Derive the cost equation for selling expenses. (Hint: y = a + bx + cy.)
b. Assume that Miami sells 50,000 units during the period. Budgeted sales totaled
65,000 units at a budgeted sales price of $5.50 per unit. Prepare a variance report to
show the difference between the master budget and the flexible budget.
What is true concerning the internal rate of return (IRR) method?
A.The IRR method determines the discount rate that equates the net present value of the
series to the initial investment.
B.The IRR method determines the discount rate that equates the net present value of the
series to hurdle rate.
C.The IRR method determines the discount rate that equates the net present value of the
series to cut-off rate.
D.The IRR method determines the discount rate that equates the net present value of the
series to zero.
Which of the following statements best describes the traditional view of quality?
A.The traditional view of quality assumes that improving quality always requires
increasing costs.
B.The traditional view of quality holds that firms can reduce total costs by producing
lower-quality goods
C.The traditional view of quality holds that firms can reduce total costs by tolerating
some level of defective goods.
D.All of the answers are correct.
Which of the following represent the specific, detailed steps required to achieve the
goals of an organization including cost control and market share?
A.organizational goals implementation plan.
B.strategic long-range profit plan.
C.master budget.
D.tactical short-range profit plan.
Which of the following is a method of managing purchasing, production, and sales, by
which the firm attempts to produce each item only as needed for the next step in the
production process?
A.Flexible manufacturing practices
B.Just-in-time inventory
C.Theory of constraints
D.Total quality management
The extent to which an organization’s cost structure is made up of fixed costs is called
its
A.fixed cost leverage.
B.operating leverage.
C.fixed cost multiple.
D.long-term leverage.
Framing Division
The Framing Division had the following data:
Refer to the Framing Division. What is the return on investment for Year 2008?
A.10%.
B.16%.
C.20%.
D.24%.
Which of the following are components of deferred compensation?
A.cash bonuses.
B.profit sharing plans.
C.special awards.
D.stock options.
What does sensitivity analysis refers to?
A.control.
B.what-if situations.
C.variable costs only.
D.fixed costs only.
Explain the differential principle and how to identify costs for differential analysis.
Target costing and pricing. Mega Products makes valves for a variety of oil extraction
equipment. Mega Products sells the valves to companies that manufacture and sell
pumps. The company’s market research department has discovered a market for valves
that is similar in automated manufacturing equipment in another industry. The market
research department indicates that they could sell to these new outlets for $250. Assume
Mega Products desires an operating profit of 20 percent of sales.
Required:
What is the highest acceptable manufacturing cost for which Mega Products would
produce the valves?
Explain how you might analyze a capital budgeting decision where the cash flow data
are nominal (including expected inflation of, say, 4 percent per year) but the quoted
cost of capital of 12 percent per year is real (excluding anticipated inflation).
If an action is legal for a company to pursue, is it necessary ethical? Discuss this in
terms of the ethical issues presented in the text.
Explain the relation between costs and prices.
Discuss the three principal uses of managerial accounting information and how they
would be used in a manufacturing organization to enhance managerial decision making.
Compare and contrast job costing and process costing. Provide specific examples of the
types of companies that might use one over the other.
Explain the application of the internal rate of return method of assessing investment
alternatives.