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: