DOESN'T NEED EXPLANATIONS!!!

4. Assume the Hiking Shoes division of the Simply Shoes Company had the following results last year (in thousands). Management's target rate of return is 10% and the weighted average cost of capital is 20%. Its effective tax rate is 30%.

Sales	$7,000,000
Operating income	1,400,000
Total assets	1,000,000
Current liabilities	790,000

What is the division's Return on Investment (ROI)?

A. 700%

B. 79%

C. 140%

D. 20%

6. Summer Nights sells bottles of bug spray for $6.50 each. Variable costs are $3.25 per bottle, while fixed costs are $42,000 per month for volumes up to 40,000 bottles of spray and $60,000 per month for volumes above 40,000 bottles of spray. The flexible budget would reflect monthly operating income for 20,000 bottles of spray and 34,000 bottles of spray of what dollar amounts?

A. $88,000 and $68,500, respectively

B. $23,000 and $68,500, respectively

C. $130,000 and $221,000, respectively

D. $5,000 and $161,000, respectively

7. Safe Dog Company makes dog crates. The budgeted selling price is $30 per crate, the variable rate is $5 per crate and budgeted fixed costs are $20,000 per month. What is the budgeted operating income for 2,900 crates sold in a month?

A. $52,500

B. $87,000

C. $34,500

D. $72,500

8. Affordable Smiles mobile dentist office budgeted for 4,320 patient visits a year. Affordable Smiles actually saw 4,445 patients during the year and they have provided the following data:

	Fixed Portion for Budget	Variable Portion per patient visit for Budget	Actual Results
Revenue		$70	$406,700
Personnel Expenses	$60,000		$63,000
Medical Supplies		$10	$38,200
Occupancy Expenses	$12,000	$1.50	$19,000
Admin Expenses	$19,000	$0.50	$20,000

Based on the given information, what is the flexible budget variance for personnel expenses?

A. $0

B. $3,000 Unfavorable

C. $3,000 Favorable

D. Cannot be determined