Question 1 10 pts A segment of a business probably should be discontinued if its contribution margin exceeds its controllable fixed costs and its common costs. it cannot produce a contribution margin. its common costs exceed its contribution margin. it has a net loss. Flag this Question Question 2 10 pts Contribution margin is calculated by deducting fixed costs from revenue. deducting variable costs and controllable fixed costs from revenue. deducting variable costs and common costs from revenue. deducting variable costs from revenue. Flag this Question Question 3 10 pts Which of the following is the first step in the decision-making process? Identify workable alternatives Define the problem Consider appropriate nonfinancial factors Evaluate the cost and revenue data Flag this Question Question 4 10 pts Fixed manufacturing costs are written off as current expenses of the period in which they occurred when using direct costing. standard costing. absorption costing. differential costing. Flag this Question Question 5 10 pts Direct costing differs from absorption costing in that under absorption costing all fixed manufacturing overhead is expensed in the current period. under direct costing all fixed overhead is expensed in the current period. under absorption costing an increase in finished goods inventory does not affect the amount of fixed costs expensed. under direct costing a portion of the fixed manufacturing overhead is included in the finished goods inventory. Flag this Question Question 6 10 pts Which is the final step in the decision-making process? Evaluate the cost and revenue data Identify workable alternatives Consider appropriate nonfinancial factors Make a decision Flag this Question Question 7 10 pts Which of the following is NOT a consideration when determining whether to continue making a part or to buy that part? the opportunity cost the timing of the cash receipts and expenditures the impact on employees the sunk cost Flag this Question Question 8 10 pts Costs that are not directly traceable to a segment of a business are called sunk costs. common costs. fixed costs. incremental costs. Flag this Question Question 9 10 pts Which of the following should NOT be a consideration when deciding whether to make or buy a part? impact on continued supply of the part impact on quality of the part under each set of circumstances impact on sales to existing customers impact on factory employee morale Flag this Question Question 10 10 pts In making a decision to replace a machine, which of the following is not relevant? the variable costs of operating the old machine the training that workers will need in order to use the new machine the book value of the old machine the variable costs of operating the new machine