Question;Multiple Choice Questions;1. The method of evaluating financial data;that change under different courses of action is called;A. financial statement analysis.;B. break-even analysis.;C. incremental analysis.;D. cost-benefit analysis.;2. Braizen, Inc. produces a product with a;$30 per-unit variable cost and an $80 per-unit sales price. Fixed manufacturing;overhead costs are $100,000. The firm has a one-time opportunity to sell an;additional 1,000 units at $60 each that would not affect its current sales.;Assuming the company has sufficient capacity to produce the additional units;how would the acceptance of the special order affect net income?;A. Income would decrease by $30,000.;B. Income would increase by $30,000.;C. Income would increase by $140,000.;D. Income would increase by $40,000.;3. Opportunity costs are;A. included in inventory.;B. foregone benefits.;C. sunk costs.;D. included in cost of goods sold.;4. A sunk cost is a cost that;A. has been incurred and cannot be;eliminated.;B. is never relevant in decision-making.;C. is never a differential cost.;D. all of the above.;5. _____________ is a cost management;technique in which the firm determines the required cost for a product or;service in order to earn a desired profit when the marketplace establishes the;product's selling price.;A. Relevant costing;B. Product costing;C. Differential costing;D. Target costing;6. ______________ can be measured as the;income that could have been earned on an asset, based on the potential rate of;return that is lost or sacrificed when one alternative use of the asset is;chosen over another.;A. Target cost;B. Sunk cost;C. Opportunity cost;D. Allocated cost;7. _____________ costs between two;alternative projects are those that would result from selecting one alternative;instead of the other.;A. Allocated;B. Differential;C. Sunk;D. Irrelevant;8. Which of the following cost;classifications would not be considered relevant in comparing decision;alternatives?;A. Opportunity cost.;B. Differential cost.;C. Sunk cost.;D. None of the above.;9. In considering whether to accept a;special order at a price less than the normal selling price of the product and;where the additional sales will make use of present idle capacity, which of the;following costs will not be relevant?;A. Direct labor.;B. Direct materials.;C. Variable manufacturing overhead.;D. Fixed manufacturing overhead that cannot;be avoided.;10. A cost classified "for decision;making purposes" would include;A. period cost.;B. opportunity cost.;C. controllable cost.;D. inventoriable cost.;11. Relevant costs in decision-making;A. are future costs that represent;differences between decision alternatives.;B. result from past decisions.;C. should not influence the decision.;D. none of the above.;12. A cost is considered relevant if;A. it is positive.;B. it is sunk.;C. it makes a difference.;D. it can't be changed.;13. If a cost is irrelevant to a decision;the cost could not be a;A. fixed cost.;B. sunk cost.;C. differential cost.;D. variable cost.;14. The potential rental value of space;used in the manufacturing process;A. is a variable production cost.;B. is an unavoidable production cost.;C. is a sunk production cost.;D. is an opportunity cost if production is;not outsourced.;15. Greenland Sports, Inc. has been asked;to submit a bid to the National Hockey League on supplying 1,000 pairs of;professional quality skates. The cost per pair of skates has been determined as;follows;Other non-manufacturing costs associated;with each pair of skates are;Assume the commission on the sale of skates;to the National Hockey League would be reduced to $15 per pair and that;available production capacity exists to produce the 1,000 pairs of skates. The;lowest price the firm can bid is some price greater than;A. $185.;B. $190.;C. $215.;D. $225.
Paper#44944 | Written in 18-Jul-2015Price : $22