7. Which of the following would be relevant in the decision to sell or throw out obsolete inventor Direct material Fixed overhead cost assigned cost assigned to the inventory to the inventory Yes Yes No Yes No Yes D) No No A) Choice A B) Choice B C) Choice D) Choice D If a company sells more units than it produces during a particular time period, which costing method will most likely yield a higher net operating income? A) Variable costing B) Absorption costing According to GAAP, which of the two costing methods listed below must a company use for external purposes? A Absorption costing B. Variable costing 10. Some investment opportunities that should be accepted from the viewpoint of the entire company may be rejected by a manager who is evaluated on the basis of: A) return on investment. B) residual income. C) contribution margin. D) segment margin. 11. Which of the following will not result in an increase in return on investment (ROI), assuming other factors remain the same? A) A reduction in expenses. B) An increase in net operating income. C) An increase in operating assets. D) An increase in sales. A company normally uses a production team of 2 skilled workers and 4 unskilled worker. The skilled workers are better than the unskilled workers in both speed and efficiency. However, the skilled workers are paid a much higher wage rate than the unskilled workers. During one period, the team consisted of 4 skilled and 2 unskilled workers. Based on this information, it is most likely that the labor rate variance would be and the labor efficiency variance would be A) favorable, favorable B) favorable, unfavorable C) unfavorable, unfavorable D) unfavorable, favorable