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1) A company's products sell for 48 each. 30 minutes of labour is needed and the product requires 3kg of material X. Labour is paid
1) A company's products sell for 48 each. 30 minutes of labour is needed and the product requires 3kg of material X. Labour is paid 12 per hour and materials cost 4/kg. Fixed costs are 360,000 per annum. How many units are required to break even? Choose the nearest. a) 7,500. b) 12,000. c) 11,250. d) 10,000. 2) A factory owns a truck which was bought two years ago for 40,000. The net book value of the truck is 30,000, and its replacement would cost 42,000. Secondhand values of this model are quite strong and it could be sold for 38,000. In making any decision about the future of the truck, the opportunity cost is; a) 40,000. b) 30,000. c) 42,000. d) 38,000. 3) In making up a cash budget, which of the following items is usually disregarded? a) Depreciation. b) Labour. c) Variable overheads. d) Materials. 4) A division's target rate of return is 10%. The division records a net profit of 120,000 on an investment of 1,000,000. What is the residual income? a) 24,000. b) 200,000. c) 20,000. d) 120,000. 5) A division's assets are 4,000,000 and its liabilities are 2,000,000; divisional net profit is 500,000. What is return on investment? Choose the nearest number. a) 83.3%. b) 41.7%. c) 25%. d) 12.5%. 6) Which of the following problems is most likely with a system of incremental budgeting? a) Managers getting tired of frequent requests for budget totals. b) Adjusting the budget to remove non-cash items. c) The need to justify each and every item of expenditure. d) The temptation on managers to spend to the budget even where unnecessary. 7) The financial perspective of the balanced scorecard is mainly concerned with how the business looks to its a) Shareholders. b) Suppliers. c) Customers. d) Employees. 8) A large firm of bakers and confectioners owns a chain of 30 bread and cake shops. Each shop is run by a manager who has responsibility for income and expenses for their branch but has no authority for ordering any investment. In terms of responsibility accounting, each shop manager is in charge of; a) A cost centre. b) A revenue centre. c) A profit centre. d) An investment centre
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