• Question 11 A professional organization is planning to conduct a series of one-day continuing education programs in various cities . The projected costs related to these programs are
• Question 12 A company wants to determine its marketing costs for budgeting purposes . Activity measures and costs incurred for four months of the current year are presented in the table below . Advertising is considered to be a discretionary cost . Salespersons are paid monthly salaries plus commissions . The sales force was increased from 20 to 21 individuals during the month of May .
• Question 13 Ajax Division of Carlyle Corporation produces electric motors , 20 % of which are sold to Bradley Division of Carlyle and the remainder to outside customers . Carlyle treats its divisions as profit centers and allows division managers to choose their sources of sale and supply . Corporate policy requires that all interdivisional sales and purchases be recorded at variable cost as a transfer price . Ajax Division ’ s estimated sales and standard cost data for the year ending December 31 , 2012 , based on the full capacity of 100,000 units , are as follows :
• Question 14 Light Company has 2,000 obsolete light fixtures that are carried in inventory at a manufacturing cost of $ 30,000 . If the fixtures are reworked for $ 10,000 , they could be sold for $ 18,000 . Alternately , the light fixtures could be sold for $ 3,000 to a jobber located in a distant city . In a decision model analyzing
these alternatives , the opportunity cost would be
• Question 15 Multiple regression differs from simple regression in that it
• Question 16 Gata Co . plans to discontinue a department with $ 48,000 contribution to overhead , and allocated overhead of $ 96,000 , of which $ 42,000 cannot be eliminated . What would be the effect of this discontinuance on Gata ’ s pretax profit ?
• Question 17 A professional organization is planning to conduct a series of one-day continuing education programs in various cities . The projected costs related to these programs are
• Question 18 Rodder , Inc . manufactures a component in a router assembly . The selling price and unit cost data for the component are as follows :
• Question 19 Lincoln Company , a glove manufacturer , has enough idle capacity available to accept a special order of 20,000 pairs of gloves at $ 12.00 a pair . The normal selling price is $ 20.00 a pair . Variable manufacturing costs are $ 9.00 a pair , and fixed manufacturing costs are $ 3.00 a pair . Lincoln will not incur any selling expenses as a result of the special order . What would be the effect on operating income if the special order could be accepted without affecting normal sales ?
• Question 20 JacKue Co . plans to produce 200,000 pairs of roller skates during January of next year . Planned production for February is 250,000 pairs . Sales are forecasted at 180,000 pairs for January and 240,000 pairs for February . Each pair of roller skates has eight wheels . JacKue ’ s policy is to maintain 10 % of the next month ’ s production in inventory at the end of a month . How many wheels should JacKue purchase during January ?
• Question 21 Which of the following is a characteristic of a flexible budget ?
• Question 22 All else being equal , the breakeven point in units will be higher if
• Question 23 The ratio of fixed costs to the contribution margin is
• Question 24 Oslo Co .’ s industrial photo-finishing division , Rho , incurred the following costs and expenses in 2012 :