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Question;WEEK 3;(TCO 3) McDevitt Company employs six individuals. They are each paid $30,000 salary per;year. How would total costs of personnel;be classified?;Variable;Fixed cost within relevant range;Mixed;Variable cost within relevant range;Question 2. Question;(TCO 3) For January, the cost;components of a picture frame include $0.35 for the glass, $0.65 for the wooden;frame, and $0.80 for assembly. The;assembly desk and tools cost $400. A;total of 1,000 frames is expected to be produced in the coming year. What cost function best represents these costs?;y = 1.80 + 400X;y = 400 + 1.80X;y = 2.20 + 1,000X;y = 1.00 + 400X;Question 3. Question;(TCO 3) Which cost estimation;method uses a formal mathematical method to develop cost functions based on;past data?;Quantitative analysis;Industrial engineering;Account analysis;Conference;Question 4. Question;(TCO 3) Penny's TV and;Appliance Store is a small company that has hired you to perform some;management advisory services. The;following information pertains to 20X2 operations: Sales (2,000 televisions);$900,000, Cost of goods sold $400,000, Store manager's salary per year $70,000;Operating costs per year $157,000, Advertising and promotion per year $15,000;Commissions (4% of sales) $36,000. What;are the estimated total costs if Penny's expects to sell 3,000 units next year?;$799,000;$1,017,000;$896,000;$799,000;Question 5. Question;(TCO 4) Feedback regarding;previous actions may affect;implementation of the decision.;future predictions.;the decision model.;All of the above;Question 6. Question;(TCO 4) For decision making, a;listing of the relevant costs;will help the decision maker concentrate on;the pertinent data.;will only include future costs.;will only include costs that differ among;alternatives.;All of the above;Question 7. Question;(TCO 4) Sunk costs;are relevant to all decisions.;have future implications.;are future costs.;are past costs.;Question 8. Question;(TCO 4) Black Tool Company has;a production capacity of 1,500 units per month, but production is only 1,250;units. The manufacturing costs are $60;per unit and marketing costs are $16 per unit.;Doug Hall offers to purchase 250 units at $76 each for the next five;months. Should Black accept the;one-time-only special order if only absorption-costing data are available?;Yes, since operating profits will most likely;increase.;No, since only the employees will benefit.;No, the company will only break even.;Yes, good customer relations are essential.;Question 9. Question;(TCO 5) The theory of;constraints is used for cost analysis when;a manufacturing company produces multiple;products and uses multiple manufacturing facilities and/or machines.;using a long-term time horizon.;operating costs are assumed fixed.;All of the above;Question 10. Question;(TCO 5) Keeping the bottleneck;operation busy and subordinating all nonbottleneck operations to the bottleneck;operation involves;keeping the bottleneck resource busy at least;90% of the time.;maximizing the contribution margin of the;nonbottleneck operation.;having the workers at the nonbottleneck;operation or machine improving their productivity.;None of the above;(US & Canada);WEEK 5;(TCO 7) When companies do not want to use market prices or;find it too costly, they typically use __________ prices, even though;suboptimal decisions may occur.;average-cost;full-cost;long-run cost;short-run average cost;Question 2. Question;(TCO 7) The price of movie;tickets for opening day and the few days following compared to the price six;months later is an example of;price gouging.;peak-load pricing.;dumping.;demand elasticity.;Question 3. Question;(TCO 7) The amount of markup;percentage is usually higher if;demand is elastic.;competition is intense.;there is idle capacity.;demand is strong.;Question 4. Question;(TCO 7) An understanding of;life-cycle costs can lead to;additional costs during the manufacturing;cycle.;less need for evaluation of the competition.;cost-effective product designs that are;easier to service.;mutually beneficial relationships between;buyers and sellers.;Points;Received: 3 of 3;Comments;Question 5. Question;(TCO 7) Each month, Haddon;Company has $275,000 total manufacturing costs (20% fixed) and $125,000;distribution and marketing costs (36% fixed).;Haddon's monthly sales are $500,000.;The markup percentage on full cost to arrive at the target;(existing) selling price is;25%.;75%.;80%.;20%.;Question 6. Question;(TCO 8) A product may be;passed from one subunit to another subunit in the same organization. The product is known as;an interdepartmental product.;an intermediate product.;a subunit product.;a transfer product.;Question 7. Question;(TCO 8) Transfer prices should;be judged by whether they promote;goal congruence.;the balanced scorecard method.;a high level of subunit autonomy in decision;making.;Both 1 and 3 are correct.;Question 8. Question;(TCO 8) A benefit of using a;market-based transfer price is the;profits of the transferring division are;sacrificed for the overall good of the corporation.;profits of the division receiving the;products are sacrificed for the overall good of the corporation.;economic viability and profitability of each;division can be evaluated individually.;None of the above;Question 9. Question;(TCO 8) The range over which;two divisions will negotiate a transfer price is;between the supplying division's variable;cost and the market price of the product.;between the supplying division's variable;cost and its full cost of the product.;anywhere above the supplying division's full;cost of the product.;between the supplying division's full cost;and 180% above its full cost.;Question 10. Question;(TCO 8) Division A sells;soybean paste internally to Division B, which in turn, produces soybean burgers;that sell for $5 per pound. Division A;incurs costs of $0.75 per pound while Division B incurs additional costs of;$2.50 per pound. Which of the following;formulas correctly reflects the company's operating income per pound?;$5.00 - ($1.25 + $2.50) = $1.25;$5.00 - ($0.75 + $2.50) = $1.75;$5.00 - ($0.75 + $3.75) = $0.50;$5.00 - ($0.25 + $1.25 + $3.50) = 0


Paper#38171 | Written in 18-Jul-2015

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