Solved by verified expert :Question 1 of 20
5.0/ 5.0 Points
The amount of income that would result from an alternative
use of cash is called:
A.differential
income.
B.sunk cost.
C.differential
revenue.
D.opportunity cost.
Answer Key:
Question 2 of 20
5.0/ 5.0 Points
What is a bottleneck?
A.A narrow area in
the plant layout often causing the production process to slow due to the
inability of production workers to move the product from station to station
B.A manufacturing
strategy used to control the production process by minimizing or eliminating
excess inventory
C.The point in the manufacturing process where
demand for the product exceeds the ability to produce the product
D.All of these
describe a bottleneck in the production process
Answer Key:
Question 3 of 20
5.0/ 5.0 Points
If fixed costs are $250,000, the unit selling price is $105,
and the unit variable cost is $65, what I the break-even sales (in units)?
A.6,250 units
B.2,381 units
C.10,000 units
D.3,846 units
Answer Key:
Question 4 of 20
5.0/ 5.0 Points
Hill Co. can further process Product O to produce Product P.
Product O is currently selling for $65 per pound and costs $42 per pound to
produce. Product P would sell for $82 per pound and would require an additional
cost of $13 per pound to produce. The differential cost of producing Product P
is $55 per pound.
A. True
B. False
Answer Key:
Question 5 of 20
5.0/ 5.0 Points
Which of the following is not a cost concept commonly used
in applying the cost-plus approach to product pricing?
A.Total cost concept
B.Product cost
concept
C.Variable cost
concept
D.Fixed cost concept
Answer Key:
Question 6 of 20
5.0/ 5.0 Points
Target costing is arrived at by:
A.taking the selling price and subtracting
desired profit.
B.taking the selling
price and adding desired profit.
C.taking the selling
price and subtracting the budget standard cost.
D.taking the budget
standard cost and reducing it by 10%.
Answer Key:
Question 7 of 20
5.0/ 5.0 Points
Only a single line, which represents the difference between
total sales revenues and total costs, is plotted on the profit-volume chart.
A. True
B. False
Answer Key:
Question 8 of 20
0.0/ 5.0 Points
If the unit selling price is $50, the volume of sales is
$450,000, sales at the break-even point amount to $375,000, and the maximum
possible sales are $550,000, the margin of safety will be 2,000 units.
In
A. True
B. False
Answer Key:
Question 9 of 20
0.0/ 5.0 Points
In using the total cost concept of applying the cost-plus
approach to product pricing, only profit is covered in the markup.
In
A. True
B. False
Answer Key:
Question 10 of 20
5.0/ 5.0 Points
The point where the sales line and the total costs line
intersect on the cost-volume-profit chart represents:
A.the maximum
possible operating loss.
B.the maximum
possible operating income.
C.the total fixed
costs.
D.the break-even point.
Answer Key:
Question 11 of 20
5.0/ 5.0 Points
A cost that will not be affected by later decisions is
termed:
A.historical cost.
B.differential cost.
C.sunk cost.
D.replacement cost.
Answer Key:
Question 12 of 20
5.0/ 5.0 Points
A cost that will not be affected by later decisions is
termed:
A.historical cost.
B.differential cost.
C.sunk cost.
D.replacement cost.
Answer Key:
Question 13 of 20
5.0/ 5.0 Points
In cost-volume-profit analysis, all costs are classified
into the following two categories:
A.mixed costs and
variable costs.
B.sunk costs and
fixed costs.
C.discretionary costs
and sunk costs.
D.variable costs and fixed costs.
Answer Key:
Question 14 of 20
5.0/ 5.0 Points
The theory of constraints is a manufacturing strategy that
focuses on reducing the influence of bottlenecks on production processes.
A. True
B. False
Answer Key:
Question 15 of 20
5.0/ 5.0 Points
The relative distribution of sales among the various
products sold by a business is termed as:
A.business’s basket
of goods.
B.contribution margin
mix.
C.sales mix.
D.product portfolio.
Answer Key:
Question 16 of 20
5.0/ 5.0 Points
In attempting to improve profitability when faced with a
bottleneck related to hours that is involved in the production of two or more
products, which of the following is most important for management to consider?
A.Contribution margin
per unit for each product
B.Time required for
each different product passing through the bottleneck
C.Selling price or
sales revenue generated by each product produced through the bottleneck
D.Contribution margin per bottleneck hour for
each product
Answer Key:
Question 17 of 20
5.0/ 5.0 Points
When a business sells more than one product at varying
selling prices, the business’s break-even point can be determined as long as
the number of products does not exceed:
A.two.
B.three.
C.fifteen.
D.there is no limit.
Answer Key:
Question 18 of 20
0.0/ 5.0 Points
If employees accept a wage contract that decreases the unit
contribution margin, the break-even point will decrease.
In
A. True
B. False
Answer Key:
Question 19 of 20
5.0/ 5.0 Points
If fixed costs are $750,000 and variable costs are 60% of
sales, what is the break-even point (in dollars)?
A.$1,875,000
B.$1,250,000
C.$1,666,667
D.$1,350,000
Answer Key:
Question 20 of 20
0.0/ 5.0 Points
The product with the highest contribution margin per scarce
resource is the most profitable.
In
A. True
B. False
Answer Key:
