AND COST MANAGEMENT 12-1 The three major influences on pricing decisions are 1. Customers 2. Competitors 3. Costs 12-2 Not necessarily. For a one-time-only special order‚ the relevant costs are only those costs that will change as a result of accepting the order. In this case‚ full product costs will rarely be relevant. It is more likely that full product costs will be relevant costs for long-run pricing decisions. 12-3 Two examples of pricing decisions with a short-run focus: 1. Pricing
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CHAPTER 1 – COST VOLUME PROFIT- MULTIPLE CHOICE QUESTIONS 1. CVP analysis can be used to study the effect of: A. changes in selling prices on a company ’s profitability. B. changes in variable costs on a company ’s profitability. C. changes in fixed costs on a company ’s profitability. D. changes in product sales mix on a company ’s profitability. E. All of these. 2. The break-even point is that level of activity where: A. total revenue equals total cost. B. variable cost equals fixed cost. C. total
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1. Cost of goods manufactured will usually include: A. only direct labor and direct materials costs. B. some costs incurred during the prior period as well as costs incurred during the current period. C. only costs incurred during the current period. D. some period costs as well as some product costs. 2. During the month of August‚ direct labor cost totaled $13‚000 and direct labor cost was 20% of prime cost. If total manufacturing costs during August were $88‚000‚ the manufacturing overhead
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Chapter 2 Questions 2-1. I agree with this statement. I would also like to add that cost behavior is also identifying the key resources that are performed‚ resources used in performing these activities‚ costs of the resources‚ and what the cost is driven from. 2-2. Two rules of thumb when analyzing cost behavior are to manage what the company manufactures‚ sells‚ and to give advice as to where costs can be reduced. 2-3. Three examples of a variable cost are a 12% increase in the production of
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Contribution Margin and Break Even Point by ACC 202 Trident University July 22‚ 2011 Contribution Margin and Break Even Point I’m going to discuss Contribution margin and what it is and how it relates to companies and profits. Contribution margin is the amount remaining from sales revenue after variable expenses have been deducted. It is the amount available to cover fixed expenses such as lease agreements and then to provide profits for the period. Contribution margin is first
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ACC604 Final Exam Practice Questions – Series H 1. The Work in Process inventory account of a manufacturing company shows a balance of $18‚000 at the end of an accounting period. The job cost sheets of the two uncompleted jobs show charges of $6‚000 and $3‚000 for materials‚ and charges of $4‚000 and $2‚000 for direct labor. From this information‚ it appears that the company is using a predetermined overhead rate‚ as a percentage of direct labor costs‚ of: A. 50% B. 200% C. 300% D. 20% 2
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1. Which of the following would increase the likelihood that a company would increase its debt ratio in its capital structure? a. An increase in costs incurred when filing for bankruptcy. b. An increase in the corporate tax rate. c. An increase in the personal tax rate. d. None of the statements above is correct. ANSWER: B An increase in the corporate tax rate would mean that firms would get larger tax breaks for interest payments. Therefore‚ firms have an incentive to increase interest payments
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_______ 1. A flexible budget is "flexible" in the sense that a budget can be prepared for any level of activity‚ but once a budget is set the budget figures are not changed if actual activity later proves to be different than budgeted activity. True False 2. In a performance report‚ actual costs should be compared to budgeted costs at the original budgeted activity level. True False 3. The overhead spending variance and the overhead efficiency variance are useful only if variable overhead really
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Financial measures‚ in particular‚ cost measures‚ are needed to evaluate alternate strategies on whether to introduce a new product or service line‚ to determine the appropriate sale price and the consequent market position for the firm’s product. Question 1) “Contribution” represents the portion of sales revenue that is not consumed by variable costs and so contributes to the coverage of fixed costs. To compute profit contribution that can be earned by carrying 1 ton of tapioca from Balik Papan to
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Jump to Navigation Frame Your location: Assessments › View All Submissions › View Attempt View Attempt 1 of 2 Title: | Exam 2 (Chapters 10-18) | Started: | July 7‚ 2011 12:16 AM | Submitted: | July 7‚ 2011 2:11 AM | Time spent: | 01:54:47 | Total score: | 94/200 = 47% Total score adjusted by 0.0 Maximum possible score: 200 | 1. | Chapter 10 #265 | | Use this information for questions that refer to the World Tennis Ball (WTB) Company case. World Tennis Ball Co. (WTB) makes
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