Q1. On the income statement, which of the following would be classified as a period cost?

-Direct Material Expense

-Promotion Expense

-Direct Labor Expense

-Inventory Carry Expense

Q2. Suppose the Chester company expands to other markets with good designs, high awareness and easy accessibility, what strategy would they be implementing?

Select: 1

-Broad cost leader

-Niche differentiation

-Broad differentiation

-Niche cost leader

Q3. Andrews Corp. ended the year carrying $35,325,000 worth of inventory. Had they sold their entire inventory at their current prices, how much more revenue would it have brought to Andrews Corp.?Select: 1

-$35,325,000

-$81,851,600

-$60,185,000

-$20,802,000

Q4. Company Baldwin invested $50,460,000 in plant and equipment last year. The plant investment was funded with bonds at a face value of $33,639,508 at 13.6% interest, and equity of $16,820,492. Depreciation is 15 years straight line. For this transaction alone which of the following statements are true?

Select: 5

-Since the new plant was funded with debt and equity, on the Balance sheet Retained Earnings decreased by $16,820,492, the difference between the investment $50,460,000 and the bond $33,639,508.

-On the Balance sheet, Long Term Debt changed by $33,639,508.

-Cash went up when the Bond was issued by $33,639,508.

-On the Balance sheet, Plant & Equipment increased by $50,460,000.

-Cash was pulled from retained earnings to cover the $16,820,492 difference between the plant purchase and bond issue.

-Depreciation increased by $3,364,000.

-Cash went down by $50,460,000 when the plant was purchased.

-Buying the plant had no net effect on the Cash account, because the plant was paid for by the bond plus retained earnings.