Question 1

Which of the following should NOT be a consideration when deciding whether to make or buy a part?

Accepted Answer

A)  differential fixed costs 
B)  opportunity costs 
C)  sunk costs 
D)  capacity costs 
A)  differential fixed costs 
B)  opportunity costs 
C)  sunk costs 
D)  capacity costs

Question 2

Which of the following is the first step in the decision-making process?

Accepted Answer

A)  Evaluate the cost and revenue data 
B)  Identify workable alternatives 
C)  Define the problem 
D)  Consider appropriate nonfinancial factors 
A)  Evaluate the cost and revenue data 
B)  Identify workable alternatives 
C)  Define the problem 
D)  Consider appropriate nonfinancial factors

Question 3

Under ____________________ costing, a portion of fixed manufacturing overhead is deferred to future periods as part of the inventory value.

Accepted Answer

The answer of Under ____________________ costing, a portion of fixed...

Question 4

The following information relates to the purchase of new machine being considered. $\begin{array} { l r r } 
& \text { New Machine } & \text { Old Machine } \
\text { Direct Material per unit } & \$ 4.32 & \$ 4.36 \
\text { Direct Labor per unit } & 4.90 & 4.95 \
\text { Variable manufacturing overhead per unit } & .36 & .37 \
\text { Variable Selling per unit } & 11.97 & 10.47 \
\text { Fixed overhead total } & 36,000 & 33,000 \
\text { Book value } & & 52,000 \
\text { Cost of new equipment (12 year life) } & 246,000 &
\end{array}$ The new machine would enable the company to make 13,500 units per year. The current capacity of 12,000 is based on the maximum number of units that the old machine can produce. The company has had to turn down orders in the past few years due to this limit on capacity and estimates that it can sell as many of the product as it can produce. The sales price per unit of the product is $34.50. Determine the relevant data. Pose one addition consideration regarding this decision.

Accepted Answer

@#IMG-DLM& Income will be $375 less with the new m

Question 5

A company has sales of $100,000, ending finished goods inventory of $9,000, variable manufacturing costs of $50,000, and fixed manufacturing costs of $28,000 for the year. Assuming the company uses direct costing, the manufacturing margin for the year is

Accepted Answer

A)  $22,000. 
B)  $31,000. 
C)  $59,000. 
D)  $13,000. 
A)  $22,000. 
B)  $31,000. 
C)  $59,000. 
D)  $13,000.

Question 6

Earnings or potential benefits foregone because a certain course of action is taken are called ____________________ costs.

Accepted Answer

The answer of Earnings or potential benefits foregone because a...

Question 7

Which of the following would not be relevant to a decision about whether to continue making a part or whether to buy it from an outside supplier?

Accepted Answer

A)  alternative uses for the plant where the part was produced if the part is purchased 
B)  a fee previously spent for design of the part 
C)  the variable costs of making the part 
D)  the number of additional employees needed to make the part 
A)  alternative uses for the plant where the part was produced if the part is purchased 
B)  a fee previously spent for design of the part 
C)  the variable costs of making the part 
D)  the number of additional employees needed to make the part

Question 8

Analyze the following divisions of Johannes' Clothing Company. Management has to make a decision whether to close one of the divisions or keep both open. Make a recommendation to management based on the information given. Of the fixed costs, parts are controllable within the divisions, but $31,000 of the total are company headquarters fixed costs. Of these, $16,000 are allocated to the Skirt Division and $15,000 to the Shirt Division. $\begin{array} { l r r r } 
& \text { Skirt } & \text { Shirt } & \text { Total } \
\text { Sales } & \$ 102,000 & \$ 89,000 & \$ 191,000 \
\text { Variable manufacturing costs } & 57,120 & 53,400 & 110,520 \
\text { Variable selling costs } & 4,600 & 3,700 & 8,300 \
\text { Fixed costs (manufacturing and selling) } & 38,200 & 35,300 & 73,500
\end{array}$

Accepted Answer

Both divisions have positive contributio

Question 9

Income statements prepared on a(n) ____________________ costing basis usually provide data in a form more useful for internal decision making.

Accepted Answer

The answer of Income statements prepared on a(n) ____________________ costing...

Question 10

The difference between revenue and variable costs is referred to as the __________________.

Accepted Answer

The answer of The difference between revenue and variable costs...

Which of the following should NOT be a consideration when deciding whether to make or buy a part?

Which of the following is the first step in the decision-making process?

Under ____________________ costing, a portion of fixed manufacturing overhead is deferred to future periods as part of the inventory value.

A company has sales of $100,000, ending finished goods inventory of $9,000, variable manufacturing costs of $50,000, and fixed manufacturing costs of $28,000 for the year. Assuming the company uses direct costing, the manufacturing margin for the year is

Earnings or potential benefits foregone because a certain course of action is taken are called ____________________ costs.

Which of the following would not be relevant to a decision about whether to continue making a part or whether to buy it from an outside supplier?

Income statements prepared on a(n) ____________________ costing basis usually provide data in a form more useful for internal decision making.

The difference between revenue and variable costs is referred to as the __________________.

Notes Payable and Notes Receivable

Merchandise Inventory

Property, Plant, and Equipment

Accounting for Partnerships

Corporations: Formation and Capital Stock Transactions

Corporate Earnings and Capital Transactions

Long-Term Bonds

Financial Statement Analysis

The Statement of Cash Flows

Departmentalized Profit and Cost Centers

Accounting for Manufacturing Activities

Job Order Cost Accounting

Process Cost Accounting

Controlling Manufacturing Costs: Standard Costs

Filters

Exam 30: Cost-Revenue Analysis for Decision Making

Which of the following should NOT be a consideration when deciding whether to make or buy a part?

Which of the following is the first step in the decision-making process?

Under ____________________ costing, a portion of fixed manufacturing overhead is deferred to future periods as part of the inventory value.

A company has sales of $100,000, ending finished goods inventory of $9,000, variable manufacturing costs of $50,000, and fixed manufacturing costs of $28,000 for the year. Assuming the company uses direct costing, the manufacturing margin for the year is

Earnings or potential benefits foregone because a certain course of action is taken are called ____________________ costs.

Which of the following would not be relevant to a decision about whether to continue making a part or whether to buy it from an outside supplier?

Income statements prepared on a(n) ____________________ costing basis usually provide data in a form more useful for internal decision making.

The difference between revenue and variable costs is referred to as the __________________.

Notes Payable and Notes Receivable

Merchandise Inventory

Property, Plant, and Equipment

Accounting for Partnerships

Corporations: Formation and Capital Stock Transactions

Corporate Earnings and Capital Transactions

Long-Term Bonds

Financial Statement Analysis

The Statement of Cash Flows

Departmentalized Profit and Cost Centers

Accounting for Manufacturing Activities

Job Order Cost Accounting

Process Cost Accounting

Controlling Manufacturing Costs: Standard Costs

Filters