1. Lucinda purchased a raffle ticket for $22. Just before the grand prize drawing two people tried to buy her ticket. The first person offered $95, and another offered $130. What is Lucinda's opportunity cost of keeping the raffle ticket?

$117 $44 $152 $130

2.

Gleam Clean cleans and waxes floors for commercial customers. The company is presently operating at less than capacity with equipment and employees idle at times. The company recently received an order from a potential customer outside the company's normal geographic service region for a price of $23,000. The size of the proposed job is 36,000 square feet. The company's normal service costs are as follows:

Unit-level materials	$0.32 per square foot
Unit-level labor	$0.39 per square foot
Unit-level variable overhead	$0.22 per square foot
Facility-level overhead	Allocated at $0.24 per square foot

If the company accepts the special offer:

The company will lose $2,560 on the job.The company will lose $10,480 on the job.The company will earn $11,480 on the job.The company will lose $19,120 on the job.

3.The Sandusky Company recorded the following costs of quality during the current period:

Downtime	$2,300
Inspection	2,900
Product design	5,900
Reliability testing upon completion of production	2,100
Restocking and packaging	3,400
Training	4,900
Warranty repairs and replacements	4,400
Total costs of quality	$25,900

Which choice below represents the correct amount of prevention and appraisal costs?

	Prevention	Appraisal
A)	$5,900	$2,900
B)	$4,900	$2,900
C)	$10,800	$5,000
D)	$4,900	$4,400

Choice BChoice DChoice CChoice A

4.

The Ted Company is considering eliminating the following product line:

	Product AXP
Sales	$50,000
Less variable costs:
Raw materials	30,000
Direct labor	9,000
Contribution margin	$11,000
Less fixed costs:
Production costs allocated to products	17,000
Profit (loss)	$(6,000)

What amount of cost is avoidable if Ted outsources production of this product?

$6,000$39,000$33,000$56,000