Machine Division Machine Division provides engines for the ATV Division of a company. The standard unit costs for Machine Division are as follows: \[\begin{array} { l l } \text { Direct materials } & \$ 500 \\ \text { Direct labour } & 1,100 \\ \text { Variable overhead } & 200 \\ \text { Fixed overhead } & 100 \\ \text { Market price per unit } & 3,000 \end{array}\] The Machine Division has excess capacity. -Refer to Machine Division. What is the best transfer price to avoid transfer price problems?

A) $300 B) $900 C) $1,350 D) $1,800 A) $300 B) $900 C) $1,350 D) $1,800

Condor Company Condor Company provided the following information for last year: $\begin{array}{ll} \text { Operating income } & \$ 60,000 \\ \text { Sales } & \$ 240,000 \\ \text { Beginning operating assets } & \$ 440,000 \\ \text { Ending operating assets } & \$ 450,000 \end{array}$ -Refer to Condor Company. What was the company's turnover ratio?

A) 0.10 B) 0.16 C) 0.32 D) 0.54 A) 0.10 B) 0.16 C) 0.32 D) 0.54

Exam 12: Performance Evaluation and Decentralization

Match each of the following terms with their correct description from the items listed below.* Each term may be used more than once, and it is possible that one or more of the classifications may not be used at all. -A Balanced Scorecard viewpoint that describes the internal processes needed to provide value for customers and owners

(Multiple Choice)

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Question 21

Match each of the following terms with their correct description from the items listed below.* Each term may be used more than once, and it is possible that one or more of the classifications may not be used at all. -The practice of delegating decision-making authority to lower levels

(Multiple Choice)

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Question 22

Residual income is sometimes used to overcome the tendency of ROI to discourage investments that are profitable for the company but that lower the division's ROI.

(True/False)

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Question 23

The direct comparison of the performance of two different investment centres is difficult using return on investment because return on investment is an absolute measure.

(True/False)

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Question 24

Sentenal Company had income of $20,000, average assets of $200,000, and sales of $80,000. What is Sentenal's ROI?

(Multiple Choice)

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Question 25

How is margin calculated?

(Multiple Choice)

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Question 26

Refer to Sunshine National Bank. Calculate the following: A. Actual cycle time in minutes B. Theoretical cycle time in minutes C. Actual velocity per hour D. Theoretical velocity per hour

(Essay)

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Question 27

Machine Division Machine Division provides engines for the ATV Division of a company. The standard unit costs for Machine Division are as follows: Direct materials \ 500 Direct labour 1,100 Variable overhead 200 Fixed overhead 100 Market price per unit 3,000 The Machine Division has excess capacity. -Refer to Machine Division. What is the best transfer price to avoid transfer price problems?

(Multiple Choice)

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(42)

Question 28

Condor Company Condor Company provided the following information for last year: Operating income \ 60,000 Sales \ 240,000 Beginning operating assets \ 440,000 Ending operating assets \ 450,000 -Refer to Condor Company. What was the company's turnover ratio?

(Multiple Choice)

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Question 29

The actual transfer price nets out for the company as a whole in that total pre-tax income for the company is the same regardless of transfer price.

(True/False)

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Question 30

By centralizing the operating decisions, central management has more freedome to engage in strategic planning and decision making.

(True/False)

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Question 31

The Seasonal Division of The Hudson Bay Department Store had a net income of $660,000, a net asset base of $5,000,000, and a required rate of return of 10%. Sales for the period totalled $4,000,000. What was the residual income for the period?

(Multiple Choice)

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Question 32

In a centralized company, overall profit margins can mask inefficiencies within the various subdivisions.

(True/False)

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Question 33

What is NOT an advantage of ROI?

(Multiple Choice)

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Question 34

Basically, EVA is residual income with the cost of capital equal to the minimum rate of return for the firm.

(True/False)

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Question 35

Match each of the following terms with their correct description from the items listed below.* Each term may be used more than once, and it is possible that one or more of the classifications may not be used at all. -The ratio of operating income to sales

(Multiple Choice)

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Question 36

Why can the level of the transfer price affect the overall company?

(Multiple Choice)

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Question 37

Residual income = Operating income - (Minimum rate of return x Average operating assets)

(True/False)

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Question 38

Match each of the following terms with their correct description from the items listed below.* Each term may be used more than once, and it is possible that one or more of the classifications may not be used at all. -The manager is evaluated on the basis of income

(Multiple Choice)

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Question 39

Which performance measure uses after-tax operating income and the actual cost of capital employed?

(Multiple Choice)

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Question 40

Showing 21 - 40 of 145

Match each of the following terms with their correct description from the items listed below.* Each term may be used more than once, and it is possible that one or more of the classifications may not be used at all. -The practice of delegating decision-making authority to lower levels

Residual income is sometimes used to overcome the tendency of ROI to discourage investments that are profitable for the company but that lower the division's ROI.

The direct comparison of the performance of two different investment centres is difficult using return on investment because return on investment is an absolute measure.

Sentenal Company had income of $20,000, average assets of $200,000, and sales of $80,000. What is Sentenal's ROI?

How is margin calculated?

Refer to Sunshine National Bank. Calculate the following: A. Actual cycle time in minutes B. Theoretical cycle time in minutes C. Actual velocity per hour D. Theoretical velocity per hour

Condor Company Condor Company provided the following information for last year: Operating income \ 60,000 Sales \ 240,000 Beginning operating assets \ 440,000 Ending operating assets \ 450,000 -Refer to Condor Company. What was the company's turnover ratio?

The actual transfer price nets out for the company as a whole in that total pre-tax income for the company is the same regardless of transfer price.

By centralizing the operating decisions, central management has more freedome to engage in strategic planning and decision making.

The Seasonal Division of The Hudson Bay Department Store had a net income of $660,000, a net asset base of $5,000,000, and a required rate of return of 10%. Sales for the period totalled $4,000,000. What was the residual income for the period?

In a centralized company, overall profit margins can mask inefficiencies within the various subdivisions.

What is NOT an advantage of ROI?

Basically, EVA is residual income with the cost of capital equal to the minimum rate of return for the firm.

Match each of the following terms with their correct description from the items listed below.* Each term may be used more than once, and it is possible that one or more of the classifications may not be used at all. -The ratio of operating income to sales

Why can the level of the transfer price affect the overall company?

Residual income = Operating income - (Minimum rate of return x Average operating assets)

Match each of the following terms with their correct description from the items listed below.* Each term may be used more than once, and it is possible that one or more of the classifications may not be used at all. -The manager is evaluated on the basis of income

Which performance measure uses after-tax operating income and the actual cost of capital employed?

Introduction to Managerial Accounting

Basic Managerial Accounting Concepts

Cost Behaviour

Cost-Volume-Profit Analysis: a Managerial Planning Tool

Job-Order Costing

Process Costing

Activity-Based Costing and Management

Absorption and Variable Costing, and Inventory Management

Budgeting, Production, Cash, and Master Budget

Standard Costing: a Managerial Control Tool

Flexible Budgets and Overhead Analysis

Short-Run Decision Making: Relevant Costing

Capital Investment Decisions

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