Anderson Co. makes and uses 5,000 components each year in its manufacturing operations. An outside supplier has offered to supply the components to Anderson at $66 per unit. Anderson's production costs are as follows: $\begin{array}{|l|l|} \hline \text { Direct materials } & \$ 8 \\ \hline \text { Direct labor } & 32 \\ \hline \text { Variable overhead } & 12 \\ \hline \text { Fixed overhead(based on normal capacity) } & 34 \\ \hline \end{array}$ If Anderson accepts the order, $8 of fixed overhead per unit will be eliminated. If the offer is accepted, operating income will

A) increase by $100,000. B) decrease by $70,000. C) decrease by $30,000. D) increase by $60,000. A) increase by $100,000. B) decrease by $70,000. C) decrease by $30,000. D) increase by $60,000.

Exam 9: Short Run Decision Analysis

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Anderson Co. makes and uses 5,000 components each year in its manufacturing operations. An outside supplier has offered to supply the components to Anderson at $66 per unit. Anderson's production costs are as follows: Direct materials \ 8 Direct labor 32 Variable overhead 12 Fixed overhead(based on normal capacity) 34 If Anderson accepts the order, $8 of fixed overhead per unit will be eliminated. If the offer is accepted, operating income will

(Multiple Choice)

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Question 81

It is not possible for a company to provide the full variety of products or services which the customer demands within a given time.

(True/False)

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Question 82

What are the two steps in the analysis for a sales mix decision?

(Essay)

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Question 83

The objective of segment profitability decisions is to identify the segments that have a negative segment margin so that managers can drop them or take corrective actions.

(True/False)

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Question 84

The point where joint products or services become separable and identifiable is known as split-off point.

(True/False)

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Question 85

Sales mix decisions should be based on the contribution margin per unit of scarce resource.

(True/False)

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Question 86

Avoidable costs are the direct variable costs and direct fixed costs traceable to the segments.

(True/False)

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Question 87

Cost information for short-run decision making focuses on

(Multiple Choice)

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Question 88

Segment profitability analysis includes the preparation of a segmented income statement.

(True/False)

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Question 89

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It is not possible for a company to provide the full variety of products or services which the customer demands within a given time.

What are the two steps in the analysis for a sales mix decision?

The objective of segment profitability decisions is to identify the segments that have a negative segment margin so that managers can drop them or take corrective actions.

The point where joint products or services become separable and identifiable is known as split-off point.

Sales mix decisions should be based on the contribution margin per unit of scarce resource.

Avoidable costs are the direct variable costs and direct fixed costs traceable to the segments.

Cost information for short-run decision making focuses on

Segment profitability analysis includes the preparation of a segmented income statement.

The Changing Business Environment - a Managers Perspective

Costing Systems- Job Order Costing

Costing Systems- Process Costing

Value-Based Systems- Abm and Lean

Cost Behavior Analysis

The Budgeting Process

Performance Management and Evaluation

Standard Costing and Variance Analysis

Capital Investment Analysis

Pricing Decisions, Incl Target Costing and Transfer Pricing

Quality Management and Measurement

Financial Analysis of Performance

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