1.Which of the following statements is true of managerial accounting?

A.It is required to follow GAAP.

B.Summary reports are prepared primarily for the company as a whole.

C.The focus is on the future.

D.An external audit by an independent CPA is required for managerial accounting information

2.Jones Manufacturing Co. is considering investing in specialized equipment costing $ 950 000The equipment has a useful life of four years and a residual value of $ 40000 Depreciation is calculated using the straight line method. The expected net cash inflows are expected to be

$ 350000 per year. What is the ARR of the investment?

A.23.68%

B.24.75%

C.22.73%

D.25.79%

3.Which of the following is a reason companies use standard costs?

A.

to enhance customer loyalty

B.

to ensure the accuracy of the financial records

C.

to identify performance standards

D.

to share best practices with other companies

4.For the next year, Sullivan & Co. predicts sales of

20000 units of a product with a contribution margin of $ 6.00 per unit and 40000units of another product with a contribution margin of $ 10.00 per unit. The weighted average contribution margin per unit is $ 8.67

TRUE OR FALSE

5.The process of evaluating relevant information that changes operating income under alternative courses of action is called ________.

A.

costminus benefit analysis

B.

CVP analysis

C.

opportunity cost analysis

D.

incremental analysis

6.Rollins, Inc. has a division that manufactures a component that sells for

$ 270 and has a variable cost of $ 135 Another division of the company wants to purchase the component. Fixed cost per unit of the component is

$ 52. What is the minimum transfer price if the division manufacturing the component is operating below its capacity?

A.$ 187

B.

$ 52

C.

$ 270

D.

$ 135

7.Which of the following is an example of internal failure costs?

A.

cost incurred as warranty expenses

B.

costs incurred for the evaluation of the quality of suppliers' processes

C.

cost incurred for the reworking of substandard products

D.

costs incurred in the inspection at various stages of production