1. When corporate costs are fully allocated to divisions, then the sum of the operating income from each division is ________.

A) greater than company wide operating income

B) equal to company as a whole operating income

C) equal to customer-level operating income

D) greater than customer-level operating income

2. If deciding whether to eliminate a division, allocating corporate costs to division, ________.

A) helps define cost reduction possibilities

B) gives the misleading impression of potential profits to the corporation as a whole.

C) identifies administrative inefficiencies

D) evaluates the effectiveness of sales personnel

3. Which of the following is true of relevant information?

A) All fixed costs are relevant.

B) All Future revenues and expenses are relevant.

C) Future

D) All fixed costs are not relevant.