The area manager of the Red, White, and Brew Restaurants is considering two possible expansion alternatives.The required investments, expected controllable margins, and the ROIs of each are as follows: \[\begin{array} { l c c c } \text { Project } & \text { Investment } & \text { Controllable Margin } & \text { ROI } \\ \text { Phoenix } & \$ 120,000 & \$ 30,000 & 25 \% \\ \text { Chicago } & \$ 540,000 & \$ 50,000 & 9.25 \% \end{array}\] The Red, White, and Brew segment has currently $2,000,000 in invested capital and a controllable margin of $250,000.Which one of following projects will increase the Red, White, and Brew division's ROI?

A) Both the Phoenix and Chicago options B) Only the Phoenix option C) Only the Chicago option D) Neither the Phoenix nor the Chicago options A) Both the Phoenix and Chicago options B) Only the Phoenix option C) Only the Chicago option D) Neither the Phoenix nor the Chicago options

Given below is an excerpt from a management performance report: $\begin{array}{llll}&\text { Budget }&\text { Actual }&\text { Difference }\\ \text { Contribution margin } & \$ 600,000 & \$ 580,000 & \$ 20,000 \mathrm{U} \\ \text { Controllable fixed costs } & \$ 200,000 & \$ 220,000 & \$ 20,000 \mathrm{U} \end{array}$ The manager's overall performance

A) is 10% above expectations. B) is 10% below expectations. C) is equal to expectations. D) cannot be determined from the information provided. A) is 10% above expectations. B) is 10% below expectations. C) is equal to expectations. D) cannot be determined from the information provided.

Exam 10: Reporting and Analyzing Liabilities

The area manager of the Red, White, and Brew Restaurants is considering two possible expansion alternatives.The required investments, expected controllable margins, and the ROIs of each are as follows: Project Investment Controllable Margin ROI Phoenix \ 120,000 \ 30,000 25\% Chicago \ 540,000 \ 50,000 9.25\% The Red, White, and Brew segment has currently $2,000,000 in invested capital and a controllable margin of $250,000.Which one of following projects will increase the Red, White, and Brew division's ROI?

(Multiple Choice)

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Question 41

Flexible budgeting relies on the assumption that unit variable costs will remain constant within the relevant range of activity.

(True/False)

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Question 42

If actual results are different from planned results, the difference must always be investigated by management to achieve effective budgetary control.

(True/False)

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Question 43

A department has budgeted monthly manufacturing overhead cost of $540,000 plus $3 per direct labor hour.If a flexible budget report reflects $1,044,000 for total budgeted manufacturing cost for the month, the actual level of activity achieved during the month was

(Multiple Choice)

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Question 44

Of the following choices, which contain both a traceable fixed cost and a common fixed cost?

(Multiple Choice)

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Question 45

Management by exception means that management will investigate areas where actual results differ from planned results if the items are material and controllable.

(True/False)

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Question 46

Top management's reaction to a difference between budgeted and actual sales often depends on

(Multiple Choice)

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Question 47

Return on investment is calculated by dividing

(Multiple Choice)

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Question 48

Which of the following would not be considered an aspect of budgetary control?

(Multiple Choice)

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Question 49

The formula for computing return on investment is controllable margin divided by average operating assets.

(True/False)

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Question 50

Within the relevant range of activity, the behavior of total costs is assumed to be

(Multiple Choice)

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Question 51

Dingo Division's operating results include: controllable margin of $150,000, sales totaling $1,200,000, and average operating assets of $500,000.Dingo is considering a project with sales of $100,000, expenses of $86,000, and an investment of average operating assets of $200,000.Dingo's required rate of return is 9%.Should Dingo accept this project?

(Multiple Choice)

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Question 52

A flexible budget report will show both actual and budget cost based on the actual activity level achieved.

(True/False)

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Question 53

Performance reports for cost centers compare actual

(Multiple Choice)

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Question 54

Management by exception

(Multiple Choice)

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Question 55

Policies regarding when a difference between actual and planned results should be investigated are generally more restrictive for noncontrollable items than for controllable items.

(True/False)

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Question 56

If costs are not responsive to changes in activity level, then these costs can be best described as

(Multiple Choice)

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Question 57

Given below is an excerpt from a management performance report: Budget Actual Difference Contribution margin \ 600,000 \ 580,000 \ 20,000 Controllable fixed costs \ 200,000 \ 220,000 \ 20,000 The manager's overall performance

(Multiple Choice)

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Question 58

Which one of the following will not increase return on investment?

(Multiple Choice)

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Question 59

A flexible budget can be prepared for each of the types of budgets included in the master budget.

(True/False)

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Question 60

Showing 41 - 60 of 156

Flexible budgeting relies on the assumption that unit variable costs will remain constant within the relevant range of activity.

If actual results are different from planned results, the difference must always be investigated by management to achieve effective budgetary control.

A department has budgeted monthly manufacturing overhead cost of $540,000 plus $3 per direct labor hour.If a flexible budget report reflects $1,044,000 for total budgeted manufacturing cost for the month, the actual level of activity achieved during the month was

Of the following choices, which contain both a traceable fixed cost and a common fixed cost?

Management by exception means that management will investigate areas where actual results differ from planned results if the items are material and controllable.

Top management's reaction to a difference between budgeted and actual sales often depends on

Return on investment is calculated by dividing

Which of the following would not be considered an aspect of budgetary control?

The formula for computing return on investment is controllable margin divided by average operating assets.

Within the relevant range of activity, the behavior of total costs is assumed to be

A flexible budget report will show both actual and budget cost based on the actual activity level achieved.

Performance reports for cost centers compare actual

Management by exception

Policies regarding when a difference between actual and planned results should be investigated are generally more restrictive for noncontrollable items than for controllable items.

If costs are not responsive to changes in activity level, then these costs can be best described as

Given below is an excerpt from a management performance report: Budget Actual Difference Contribution margin \ 600,000 \ 580,000 \ 20,000 Controllable fixed costs \ 200,000 \ 220,000 \ 20,000 The manager's overall performance

Which one of the following will not increase return on investment?

A flexible budget can be prepared for each of the types of budgets included in the master budget.

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: the Big Picture

Managerial Accounting

Time Value of Money and Present Value Calculations

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