Question 1

The return on investment can ordinarily be improved by either increasing sales,reducing expenses,or reducing operating assets.

Accepted Answer

A) True 
 B)False  True

Question 2

Only those costs that would disappear over time if a segment were eliminated should be considered traceable costs of the segment.

Accepted Answer

A) True 
 B)False  True

Question 3

(Appendix 11A)What will be the total external failure cost appearing on the quality cost report?

Accepted Answer

A)  $124,000. 
B)  $132,000. 
C)  $245,000. 
D)  $524,000. 
A)  $124,000. 
B)  $132,000. 
C)  $245,000. 
D)  $524,000. B

Question 4

(Appendix 11A)Division X of Charter Corporation makes and sells a single product that is used by manufacturers of forklift trucks.Presently,it sells 12,000 units per year to outside customers at $24 per unit.The annual capacity is 20,000 units,and the variable cost to make each unit is $16.Division Y of Charter Corporation would like to buy 10,000 units a year from Division X to use in its products.There would be no cost savings from transferring the units within the company rather than selling them on the outside market.What should be the lowest acceptable transfer price from the perspective of Division X?

Accepted Answer

A)  $16.00. 
B)  $17.60. 
C)  $21.40. 
D)  $24.00. 
A)  $16.00. 
B)  $17.60. 
C)  $21.40. 
D)  $24.00.

Question 5

Many firms tend to adopt a focus or a niche strategy instead of either a cost leadership or a differentiation strategy.

Accepted Answer

A) True 
 B)False

Question 6

(Appendix 11A)Which of the following would be classified as an external failure cost on a quality cost report?

Accepted Answer

A)  Quality training. 
B)  Systems development. 
C)  Repairs and replacements beyond the warranty period. 
D)  Quality engineering. 
A)  Quality training. 
B)  Systems development. 
C)  Repairs and replacements beyond the warranty period. 
D)  Quality engineering.

Question 7

(Appendix 11A)Harvie Company's quality cost report is to be based on the following data:   
Required:
Prepare a quality cost report in good form with separate sections for prevention costs,appraisal costs,internal failure costs,and external failure costs.

Accepted Answer

The answer of (Appendix 11A)Harvie Company's quality cost report is...

Question 8

(Appendix 11A)Galben Company's quality cost report is to be based on the following data:   
Required:
Prepare a quality cost report in good form with separate sections for prevention costs,appraisal costs,internal failure costs,and external failure costs.

Accepted Answer

The answer of (Appendix 11A)Galben Company's quality cost report is...

Question 9

(Appendix 11A)Which of the following would be classified as an external failure cost on a quality cost report?

Accepted Answer

A)  Product recalls. 
B)  Quality engineering. 
C)  Quality training. 
D)  Systems development. 
A)  Product recalls. 
B)  Quality engineering. 
C)  Quality training. 
D)  Systems development.

Question 10

(Appendix 11A)What will be the total appraisal cost appearing on the quality cost report?

Accepted Answer

A)  $75,000. 
B)  $92,000. 
C)  $102,000. 
D)  $112,000. 
A)  $75,000. 
B)  $92,000. 
C)  $102,000. 
D)  $112,000.

Question 11

If Axle sells 16,000 units per year,what would be the return on investment?

Accepted Answer

A)  12%. 
B)  15%. 
C)  16%. 
D)  18%. 
A)  12%. 
B)  15%. 
C)  16%. 
D)  18%.

Question 12

Some managers believe that residual income is superior to return on investment as a means of measuring performance,as it encourages the manager to make investment decisions that are more consistent with the interests of the company as a whole.

Accepted Answer

A) True 
 B)False

Question 13

(Appendix 11A)What will be the total external failure cost appearing on the quality cost report?

Accepted Answer

A)  $59,000. 
B)  $79,000. 
C)  $22,000. 
D)  $403,000. 
A)  $59,000. 
B)  $79,000. 
C)  $22,000. 
D)  $403,000.

Question 14

Last year,a company had shareholders' equity of $160,000,operating income of $16,000,and sales of $100,000.The turnover was 0.5.What was the return on investment (ROI)?

Accepted Answer

A)  7%. 
B)  8%. 
C)  9%. 
D)  10%. 
A)  7%. 
B)  8%. 
C)  9%. 
D)  10%.

Question 15

What was the segment margin ratio in Store J?

Accepted Answer

A)  16%. 
B)  24%. 
C)  40%. 
D)  60%. 
A)  16%. 
B)  24%. 
C)  40%. 
D)  60%.

Question 16

(Appendix 11A)What allocation method recognizes that service departments often provide each other with interdepartmental services,and it is therefore considered to be the most accurate method for allocating service department costs to operating departments?

Accepted Answer

A)  The direct method. 
B)  The step-down method. 
C)  The reciprocal method. 
D)  The allocation by cost behaviour methoD. 
A)  The direct method. 
B)  The step-down method. 
C)  The reciprocal method. 
D)  The allocation by cost behaviour methoD.

Question 17

Suppose the manager of Axle desires an annual residual income of $45,000.In order to achieve this,Axle should sell how many units per year?

Accepted Answer

A)  14,500 units. 
B)  16,750 units. 
C)  18,250 units. 
D)  19,500 units.#units = (200,000 + 135,000)/(50 - 30)= 16,750 units 
A)  14,500 units. 
B)  16,750 units. 
C)  18,250 units. 
D)  19,500 units.#units = (200,000 + 135,000)/(50 - 30)= 16,750 units

Question 18

Suppose the manager of Axle desires a return on investment of 22%.In order to achieve this goal,Axle must sell how many units per year?

Accepted Answer

A)  14,500 units. 
B)  16,750 units. 
C)  18,250 units. 
D)  19,500 units. 
A)  14,500 units. 
B)  16,750 units. 
C)  18,250 units. 
D)  19,500 units.

Question 19

(Appendix 11A)What will be the total prevention cost appearing on the quality cost report?

Accepted Answer

A)  $69,000. 
B)  $139,000. 
C)  $148,000. 
D)  $178,000. 
A)  $69,000. 
B)  $139,000. 
C)  $148,000. 
D)  $178,000.

Question 20

The performance of the manager of Division A is evaluated by residual income.Which of the following would improve the manager's performance?

Accepted Answer

A)  Increase in average operating assets. 
B)  Decrease in average operating assets. 
C)  Increase in minimum required return. 
D)  Decrease in operating income. 
A)  Increase in average operating assets. 
B)  Decrease in average operating assets. 
C)  Increase in minimum required return. 
D)  Decrease in operating income.

The return on investment can ordinarily be improved by either increasing sales,reducing expenses,or reducing operating assets.

Only those costs that would disappear over time if a segment were eliminated should be considered traceable costs of the segment.

(Appendix 11A)What will be the total external failure cost appearing on the quality cost report?

Many firms tend to adopt a focus or a niche strategy instead of either a cost leadership or a differentiation strategy.

(Appendix 11A)Which of the following would be classified as an external failure cost on a quality cost report?

(Appendix 11A)Harvie Company's quality cost report is to be based on the following data: Required: Prepare a quality cost report in good form with separate sections for prevention costs,appraisal costs,internal failure costs,and external failure costs.

(Appendix 11A)Galben Company's quality cost report is to be based on the following data: Required: Prepare a quality cost report in good form with separate sections for prevention costs,appraisal costs,internal failure costs,and external failure costs.

(Appendix 11A)Which of the following would be classified as an external failure cost on a quality cost report?

(Appendix 11A)What will be the total appraisal cost appearing on the quality cost report?

If Axle sells 16,000 units per year,what would be the return on investment?

Some managers believe that residual income is superior to return on investment as a means of measuring performance,as it encourages the manager to make investment decisions that are more consistent with the interests of the company as a whole.

(Appendix 11A)What will be the total external failure cost appearing on the quality cost report?

Last year,a company had shareholders' equity of $160,000,operating income of $16,000,and sales of $100,000.The turnover was 0.5.What was the return on investment (ROI)?

What was the segment margin ratio in Store J?

(Appendix 11A)What allocation method recognizes that service departments often provide each other with interdepartmental services,and it is therefore considered to be the most accurate method for allocating service department costs to operating departments?

Suppose the manager of Axle desires an annual residual income of $45,000.In order to achieve this,Axle should sell how many units per year?

Suppose the manager of Axle desires a return on investment of 22%.In order to achieve this goal,Axle must sell how many units per year?

(Appendix 11A)What will be the total prevention cost appearing on the quality cost report?

The performance of the manager of Division A is evaluated by residual income.Which of the following would improve the manager's performance?

Managerial Accounting and the Business Environment

Cost Terms, Concepts, and Classifications

Cost Behaviour: Analysis and Use

Cost-Volume-Profit Relationships

Systems Design: Job-Order Costing

Systems Design: Process Costing

Activity-Based Costing: a Tool to Aid Decision Making

Variable Costing: a Tool for Management

Budgeting

Standard Costs and Overhead Analysis

Relevant Costs for Decision Making

Capital Budgeting Decisions

Financial Statement Analysis Online

Filters

Exam 11: Reporting for Control

The return on investment can ordinarily be improved by either increasing sales,reducing expenses,or reducing operating assets.

Only those costs that would disappear over time if a segment were eliminated should be considered traceable costs of the segment.

(Appendix 11A)What will be the total external failure cost appearing on the quality cost report?

Many firms tend to adopt a focus or a niche strategy instead of either a cost leadership or a differentiation strategy.

(Appendix 11A)Which of the following would be classified as an external failure cost on a quality cost report?

(Appendix 11A)Harvie Company's quality cost report is to be based on the following data: Required: Prepare a quality cost report in good form with separate sections for prevention costs,appraisal costs,internal failure costs,and external failure costs.

(Appendix 11A)Galben Company's quality cost report is to be based on the following data: Required: Prepare a quality cost report in good form with separate sections for prevention costs,appraisal costs,internal failure costs,and external failure costs.

(Appendix 11A)Which of the following would be classified as an external failure cost on a quality cost report?

(Appendix 11A)What will be the total appraisal cost appearing on the quality cost report?

If Axle sells 16,000 units per year,what would be the return on investment?

Some managers believe that residual income is superior to return on investment as a means of measuring performance,as it encourages the manager to make investment decisions that are more consistent with the interests of the company as a whole.

(Appendix 11A)What will be the total external failure cost appearing on the quality cost report?

Last year,a company had shareholders' equity of $160,000,operating income of $16,000,and sales of $100,000.The turnover was 0.5.What was the return on investment (ROI)?

What was the segment margin ratio in Store J?

(Appendix 11A)What allocation method recognizes that service departments often provide each other with interdepartmental services,and it is therefore considered to be the most accurate method for allocating service department costs to operating departments?

Suppose the manager of Axle desires an annual residual income of $45,000.In order to achieve this,Axle should sell how many units per year?

Suppose the manager of Axle desires a return on investment of 22%.In order to achieve this goal,Axle must sell how many units per year?

(Appendix 11A)What will be the total prevention cost appearing on the quality cost report?

The performance of the manager of Division A is evaluated by residual income.Which of the following would improve the manager's performance?

Managerial Accounting and the Business Environment

Cost Terms, Concepts, and Classifications

Cost Behaviour: Analysis and Use

Cost-Volume-Profit Relationships

Systems Design: Job-Order Costing

Systems Design: Process Costing

Activity-Based Costing: a Tool to Aid Decision Making

Variable Costing: a Tool for Management

Budgeting

Standard Costs and Overhead Analysis

Relevant Costs for Decision Making

Capital Budgeting Decisions

Financial Statement Analysis Online

Filters