1. The value chain is important in management accounting in that it: a.

influences cost control and decision making along the product life cycle b.

helps management to plan how they deliver service to suppliers of raw materials c.

creates a channel for management to compare costs and units produced d.

assists with planning the value customers get and how they use the service

2. If the 'contribution to sales ratio/contribution margin ratio' increases, what is the effect on break-even sales revenue? a.

It decreases b.

It increases c.

It remains the same d.

It fluctuates

3. SevenUp Inc manufactures and sells a brand of soft drinks that is quite popular in Jamaica. A projected income statement for the expected sales volume of 1,000,000 cases as follows:

Sales $4,500,000

Variable expenses $1,000,000

contribution $3,500,000

Fixed cost $2,000,000

Before-tax-profit $1,500,000

How many cases would you need to be sold to have a before-tax profit of $1,850,000?

a.

1,300,000 cases

b.

1,500,cases

c.

1,100,000 cases

d.

1,700,000 cases

4.Given for Winn Company in 2005:revenues $530,000, manufacturingcosts $220,000 (one-half fixed), andmarketing and administrative cost$270,000 (two thirds variable). Thecontribution margin is:

a.

$330,000

b.

$40,000. c.

$240,000

d.

$310,000

5. You are the management accountant for MAIL Ltd. One of the company's suppliers offers to let you use the supplier's condominium in Montego Bay during Sumfest. You politely reject the offer, explaining that acceptance would violate the ethical standards of your profession. Which standard was relevant to your decision?

a.

competence b.

objectivity c.

integrity d.

confidentiality

6. (CPA) Koby Company has revenuesof $200,000, variable costs of$150,000, fixed cost of $60,000, andoperating loss of $10,000. By howmuch would Koby need to increase itsrevenues in order to achieve a targetoperating income of 10% of revenues?

a.

$200,000

b.

$251,000

c.

$231,000

d.

$400,000

7. A firm is operating at full capacity, what is the MINIMUM price it should accept for a special-order? Variable: a.

and incremental fixed costs associated with the special order, plus contribution forgone on regular units b.

costs of the special order plus fixed manufacturing costs associated with the special order c.

and incremental fixed costs associated with the special order plus fixed cost on regular units d.

costs of the special order

8. When a business is faced with a limiting factor, what should be the major objective of the entity? a.

To produce all products b.

To produce the product with the highest contribution margin per unit c.

Do no production d.

Produce the product that has the highest contribution per unit of the limiting factor

9. The cost of an asset acquired three years ago is a good example of a/an:

a.

sunk cost b.

relevant cost c.

avoidable cost d.

notional cost

10. In a make or buy situation, management needs to consider certain factors in order to make a reasonable decision. Some of these factors include: i. the quality of the products being purchased externally ii. whether delivery time is able to be met and iii. customer loyalty might be affected if sales are forgone due to cases of full capacity a.

i and ii b.

i and iii c.

ii and iii d.

. i, ii and iii