Management Accounting Multiple choices. just need answers.
1. What term is used to describe factors in a decision problem that cannot be expressed effectively in numerical terms? Select one: A Qualitative B Quantitative C Sensitive D Uncertain 2. Opportunity cost may also be described as: Select one: A a foregone benefit B a comparative cost C a frontier cost D an alternative cost 3. Mod Clothiers makes women's clothes. It costs $28 000 to produce 5000 pairs of polkadot polyester pants. They have been unable to sell the pants at their usual price of $50.00. The company is evaluating two alternatives. They could sell the pants 'as is' for a total of $15 000 or they could modify the pants at a cost of $3000 and sell them for a total of $20 000. What would be the effect on profit of modifying the pants and selling them as opposed to selling 'as is'? Select one: A $8000 decrease B $11 000 decrease C $2000 increase D $3000 increase 4. Assume JED Industries could avoid $40,000 of fixed manufacturing overheads if it purchases the component from the outside supplier. If JED purchases the component from the supplier instead of manufacturing it, the effect on income would be a Select one: A $320,000 increase. B $160,000 increase. C $120,000 decrease. D $80,000 decrease. 5. Fruities Ltd has two divisions, Durian Division and Juice Division. Durian Division has an annual capacity of 10 000 units of either juice concentrate or fruit paste. Usually, Durian Division produces durian juice concentrate for the Juice Division. Juice Division's annual requirement of durian juice concentrate is 8000 units. There is no external market for durian juice concentrate; however, the Durian Division can use its facilities to manufacturer prune paste, which is a very popular product with unlimited external demand. The market price for prune paste is $13 per unit. The variable production cost of one unit of durian juice concentrate at Durian Division is $6, and the variable production cost of one unit of prune paste is $8. Durian division also incurs $1 additional shipping cost per unit when selling prune paste to external suppliers. Using the transfer pricing formula, what is the per unit transfer price selling one unit of durian juice concentrate to Juice Division? Select one: A $6 B $8 C $10 D $11 6. Given the following data for Division L: Division N would like to purchase 10,000 units from Division L at a price of $125 per unit. Division L has no excess capacity to handle Division N's requirements. Division N currently purchases from an outside supplier at a price of $140. If Division L accepts a $125 price internally, the company, as a whole, will be better or worse off by Select one: A $600,000 B $100,000 C $115,000 D $250,000 7. DeleteYou manufactures keyboards. The quality manager recently estimated that 40% of the keyboards sold last year had attracted complaints from customers regarding the poor quality materials used in the keyboards. As a result, she has decided to increase incoming material inspection: staff will now inspect 10% of incoming materials instead of 1% of incoming materials. What is the likely effect of this action? Select one: A External failure costs will increase B Internal failure costs will increase C Prevention costs will increase D Appraisal costs will decrease 8. Refer to the following: Cost $000s Machine operator recruitment costs 65 Machine breakdown repairs 50 Warranty repairs 24 Training costs for machine operators 58 Handling customer complaints 28 Quality testing 30 Predelivery inspection of finished goods 34 Inspection of warranty repair work 45 Rework of faulty goods found during inspection 58 Inspection of partially completed goods 60 The total cost of internal failure is: Select one: A $97 000 B $108 000 C $205 000 D $160 000 9. Which of the following is an example of an internal direct measure of quality? Select one: A Ontime delivery rate B Average cost of warranties C Average cost of defects D Average equipment downtime 10. Inspection labour costs are Select one: A prevention costs. B appraisal costs. C internal failure costs. D external failure costs
