Exam 5: Relevant Information for Decision Making With a Focus

Information is relevant in business decisions if it is a(n)________.

Discriminatory pricing is the act of charging different prices to different customers for the same product or service.

With perfect competition and a fixed set of production facilities,the marginal cost often increases as production increases up to a point because of efficiencies created by larger amounts.

With increased global competition in many industries,companies are increasingly limited in influencing product prices.

Overcapacity is some countries often causes aggressive pricing policies,particularly for a company's imported goods.

Accountants are sometimes forced to trade relevant information for accurate information.

Target costing is most effective at reducing costs if used during the product design phase.

In perfect competition,the profit-maximizing volume is the quantity at which the difference between the sales price and marginal cost is at its greatest.

Cougar Company is trying to decide which product to manufacture.Expected direct materials costs are $4 for each product.In choosing between the two products,the direct materials costs are ________.

Full cost means the total of all variable manufacturing costs and all fixed manufacturing costs.

In the decision process,predictions obtained from the accounting system and other sources become ________.

A small appliance manufacturer is deciding whether to accept or reject a special order for 1,750 appliances.There is sufficient capacity available for the special order.What is relevant information for the decision whether to accept or reject the special order?

Which item is usually NOT important to special order decisions?

Federer Company has budgeted the following costs for the production of its only product: Federer Company has a target profit of $50,000.What is the average target markup percentage for setting prices as a percentage of total variable costs?

________ is the predicted future costs and revenues that will differ among alternative courses of action.

What are the qualitative aspects of a decision?

Historical or past information can have an indirect bearing on a decision because ________.

Arizona Company has the following data about its only product: Arizona Company uses the contribution approach.What is the operating income?

Managers can usually compute the change in total costs by multiplying any change in volume by the full unit cost.

Colbert Company has the following information about its only product: Required: A)Prepare an income statement using the contribution approach. B)Prepare an income statement using the absorption approach.