Q1. Non-financial performance measures that help a business keep on track to acieve its goals are generally:

a) operational b) misunderstood c) short-term d) strategic e)balanced

Q2. Perez & Perez manufatures refrigerators. One of its production lines produces the compressors. Variable costs per compressor is $640. The fixed costs allocated to the production line are $150,000 per month. Yuma Ltd produces compressors and offered to Perez & Perez to sell them 1,800 compressors they need per month at $700 each. If Perez & Perez accept the offer from Yuma Ltd, fixed costs allocated to the production line can be reduced to $40,000 per month. Based on quantitative analysis, what would be your decision?

a) do no accept the offer because the cost increase by $50 per compressor

b) accept the offer because the total cost per month decreases by $110,000

c) none of the options is correct

d) accept the offer because the total cost per month decreases by $2000

e) do not accep the offer because the total cost increases by $68,000

Q3. Park Ltd produces financial calculators. The production capacity is 35,000 calculators, and the company is currently operating at 80% capacity. Variable manufacturing costs are $12 per unit. Fixed manufacturing costs are $420,000. The calculators are normally sold to Computek Ltd at $28 each. Bronson has an offer from Office Equipment Ltd (a foreign wholesaler) to purchase an additional 6,000 calculators at $14 per unit. The delivery costs for this order would be $13.000. What is the available capacity of Park Ltd before accpeting this order?

a) cannot be determined with the data provided b) 35,000 units c) 28,000 d) 7,000 units e)6,000

Q4. The break-even point is where:

a) all of the options are correct b) total sales = total variable costs plus profit c) total sales = fixed costs plus profit d) total sales= total costs e) total sales= total variable costs

Q5. If the profit beofre tax is $210,000, required rate of return is 12% and the investment is $1,400,000, the residual income is:

a) $42,000 b) $168,000 c) 3% d) 15% e) none of the options is correct

Q6. From the following data calculate the estimated cash received from total sales during the month of May. Total sales for April, $40,000; May, $18,000. Cash sales are 60% of total sales and credit sales are 40% of total sales in each month. Credit sales are normally settled in the following pattern: 20% in the month of sale and 80% in the month following the sale.

a) $35,600 b) $25,040 c) $12,240 d) $18,000 e) $34,000

Q7. Which of the following statements regarding the Internal rate of Return (IRR) is TRUE:

a) if the internal rate of retur is lower than the discount rate the payback period is lower than teh required payback period

b) none of the options is correct

c) if the internal rate of return is the discount rate the net present value is equal to zero

d) if the internal rate of return is higher than the discount rate the net present value is negative

e) a preffered investment is the investment in which the discount rate is higher than the internal rate of return

Q8. Arnold Ltd allocates overhead based on machine hours and estimates its total overhead costs will be $140,000 for the coming year. it will use $28,000 direct labour hours and $14,000 machine hours during that same period. How much overhead will be charged to a job that used 15 machine hours?

a) $150 b) $225 c)$10 d) unable to be determined from the information given e)$75