27. The process of evaluating financial data that change under
alternative courses of action is called
28. Seasons Manufacturing manufactures a product with a unit
variable cost of $100 and a unit sales price of $176. Fixed
manufacturing costs were $480,000 when 10,000 units were produced
and sold. The company has a one-time opportunity to sell an
additional 1,000 units at $140 each in a foreign market which would
not affect its present sales. If the company has sufficient capacity to
produce the additional units, acceptance of the special order would
affect net income as follows:
29. Carter, Inc. can make 100 units of a necessary component part
with the following costs:
Direct Materials $120,000
Direct Labor 20,000
Variable Overhead 60,000
Fixed Overhead 40,000
If Carter can purchase the component externally for $220,000 and
only $10,000 of the fixed costs can be avoided, what is the correct
make-or-buy decision?
30. A company has a process that results in 15,000 pounds of Product
A that can be sold for $16 per pound. An alternative would be to
process Product A further at a cost of $200,000 and then sell it for $28
per pound. Should management sell Product A now or should Product
A be processed further and then sold? What is the effect of the action?
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ACC 561 Final Exam Guide All 4 Sets
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