Question 1: A company believes it can sell 1,000,000 units of its proposed new can opener at a price of $14.00 each. If the company desires to make a profit $3,000,000 on the can opener, what is the target cost per can opener? A $14.00 B $11.00 C $8.00 D $17.00 Question 2: One customer orders $20,000,000 worth of product each year by making 50 electronic orders. The direct cost of these orders is $16,000,000. The customer orders an average of 20 separate items on each order (1,000 items for the year) and has ordered a total of 5,000,000 items during the year, and returns nothing. Using activity based methods, what is the profit from this customer? A $4,000,000 B $3,846,900 C $2,950,000 D $0 Question 3: You?ve just won a lottery and will receive $60,000 per year over the next 20 years. If you feel that 10% is an appropriate rate of return, what is the present value of your winnings? A $1,200,000 B $510,816 C $251,550 D $178,320 Question 4: Peirzynski Manufacturing Corporation produces a single product, the Utility Knife. Budgeted amounts for the coming year are as follows: Revenues (20,000 units at $12 each) $240,000 Direct material 40,000 Direct labor 70,000 Variable manufacturing overhead 50,000 Fixed manufacturing overhead 30,000 Net income $50,000 Podsednik Company has offered to purchase 1,500 units of a special edition of the utility knife from Peirzynski at a price of $11.50 per unit. This special edition will have additional variable costs of $0.25 per unit. Peirzynski has the capacity to produce this order and it will not affect any of their other operations. What is the incremental cost of accepting the special order? A $12,000 B $14,250 C $14,625 D $12,375 Question 5: The BigByte Company has 12 obsolete computers that are carried in inventory at a cost of $13,200. If these computers are upgraded at a cost of $7,500, they could be sold for $15,300. Alternatively, the calculators could be sold ?as is? for $9,000. What is the net advantage or disadvantage of re-working the computers? A $6,300 advantage B $1,200 disadvantage C $5,400 disadvantage D $3,000 advantage

Question 1: A company believes it can sell 1,000,000 units of its proposed new can opener at a price of $14.00 each. If the company desires to make a profit $3,000,000 on the can opener, what is the target cost per can opener? A $14.00 B $11.00 C $8.00 D $17.00 Question 2: One customer orders $20,000,000 worth of product each year by making 50 electronic orders. The direct cost of these orders is $16,000,000. The customer orders an average of 20 separate items on each order (1,000 items for the year) and has ordered a total of 5,000,000 items during the year, and returns nothing. Using activity based methods, what is the profit from this customer? A $4,000,000 B $3,846,900 C $2,950,000 D $0 Question 3: You've just won a lottery and will receive $60,000 per year over the next 20 years. If you feel that 10% is an appropriate rate of return, what is the present value of your winnings? A $1,200,000 B $510,816 C $251,550 D $178,320 Question 4: Peirzynski Manufacturing Corporation produces a single product, the Utility Knife. Budgeted amounts for the coming year are as follows: Revenues (20,000 units at $12 each) $240,000 Direct material 40,000 Direct labor 70,000 Variable manufacturing overhead 50,000 Fixed manufacturing overhead 30,000 Net income $50,000 Podsednik Company has offered to purchase 1,500 units of a special edition of the utility knife from Peirzynski at a price of $11.50 per unit. This special edition will have additional variable costs of $0.25 per unit. Peirzynski has the capacity to produce this order and it will not affect any of their other operations. What is the incremental cost of accepting the special order? A $12,000 B $14,250 C $14,625 D $12,375 Question 5: The BigByte Company has 12 obsolete computers that are carried in inventory at a cost of $13,200. If these computers are upgraded at a cost of $7,500, they could be sold for $15,300. Alternatively, the calculators could be sold \"as is\" for $9,000. What is the net advantage or disadvantage of re-working the computers? A $6,300 advantage B $1,200 disadvantage C $5,400 disadvantage D $3,000 advantage