1. A company is considering a new project that will cost $19,000. This project would result in additional annual revenues of $6,000 for the next 5 years and the company has already paid for $2,000 for permit fees. The $2,000 cost is an example of a(n):

• . . Sunk cost

• . . Fixed cost

• . . Incremental cost

• . . Uncontrollable cost

QUESTION 17

When using activity based costing method overhead allocation is typically based on:

• . . One rate

• . . Two or more rates

• . . At least 2 rates but usually many more

• . . Volume based measures such as machine hours

QUESTION 11

• An unfavorable materials variance is caused by

• . . Paying employees a higher wage than the standard

• . . Paying employees a lower wage than the standard

• . . Purchasing material at a cost that is lower than the standard

• . . . Cannot determine based on the information given

QUESTION 6

• Ace Company wants to give their managers the greatest amount of responsibility over their departments accounting. Which of the following responsibility centers would accomplish that goal?

• . . Cost center

• . . Profit center

• . . Investment center

• . . Company center