QUESTION 38 Which of the following is NOT a reason for firms to decentralize: Improve customer relations Increase employee motivation Allow top management more time for day-to-day decision making. Allow top management more time for long-term planning QUESTION 39 What is the SPKY mold division's Residual Income (RI? 5472.500 $600,000 $690,000 $300,000 QUESTION 40 SPKY is preparing its cash budget for the upcoming month. The budgeted beginning cash balance is expected to be $30,000. Budgeted cash receipts are 5101,000, while budgeted cash disbursements are $123.000. Webber Company wants to have an ending cash balance of $45,000. How much would Webber Company need to borrow to achieve its desired ending cash balance? 58.000 $23,000 $37,000 $53,000 QUESTION 41 All other things being equal, a company's return on investment (ROI) would generally increase when: average operating assets increase. sales decrease operating expenses decrease. operating expenses increase QUESTION 34 Which of the following is not a benefit of budgeting? It uncovers potential bottlenecks before they occur. It coordinates the activities of the entire organization by integrating the plans and objectives of the various parts. It ensures that accounting records comply with generally accepted accounting principles. It provides benchmarks for evaluating subsequent performance. QUESTION 3 Which of the following statements is not true about the Direct Labour Budget? If properly used it would assist in reducing inefficiency on the part of employees. It is developed after the Production Budget Output from this budget is used in the Selling and Administrative Expense Budget Output from this budget is used to determine the cost of goods manufactured) QUESTION 36 SPKY's variable expenses are 75% of sales. At a sales level of $400,000, the company's degree of operating leverage is 8. At this sales level, fixed expenses equal? $50,000 $75,000 $87,500 $100,000 QUESTION 27 In order to sell its products, a company must meet the competition's price. Which of the following is TRUE about the company's product? The company is a price setter. There is not a lot of competition for the product. The product lacks uniqueness. The company uses cost-plus pricing QUESTION 28 SPI-K is preparing its Manufacturing Overhead Budget for the third quarter of the year. Budgeted variable factory overhead is $3.00 per unit produced; budgeted fixed factory overhead is $75,000 per month, with $16,000 of this amount being factory depreciation Variable factory overhead is paid in the month incurred) if the budgeted production for August is 5,000 units, then the total budgeted factory overhead per unit is: $15. $18 $20. $22. QUESTION 29 SPI-K manufactures and sells ceramic pots, Leone Corporation has offered SPIK $10 per pot for 2.000 pots. SPI-K's normal selling price is $12 per pot. The total manufacturing cost per pot is $9 and consists of variable costs of $7 per vase and fixed overhead costs of $2 per vase. (NOTE: Assume excess capacity and no effect on regular sales.) Should SPI-K accept or reject the special sales order? Accept, because operating income would increase $6,000 Reject, because operating income would decrease $6,000 Reject, because operating income would decrease $34.000. Accept, because operating Income would increase $34.000 QUESTION 19 SPKY Company produces a single product that sells for $100 per unit. Fixed expenses total 12,000 per month, and variable expenses are $60 per unit. The company's sales average 500 units per month. Which of the following statements is correct? The company's break-even point is $12.000 per month The fixed expenses remain constant at $24 per unit for any activity level within the relevant range. The company's contribution margin ratio is 40%. All the answers are correct. QUESTION 20 Last year sales were $200,000, net operating income was $75,000, and average operating assets were $500,000. If sales next year remain the same as last year and expenses and average operating assets are reduced by 5%, what will be the return on investment next year? 12.2% 18.2% 20.2% 25.2% QUESTION 21 SPI-K bakes gingerbread cookies and sells them by the dozen. During the holiday season, they bake 1,000 dozen cookies. They can sel the plain, undecorated cookies rasis for sz per dozen. If they decorate the cookies at an additional cost of 1 per dozen, each decorated dozen could be sold for $3.50. Should SPIK sell the cookies undecorated (as is) or should the cookies be decorated processed further? SPIK should decorate the cookies since operating income will be higher by $500 than if they sell them undecorated (as is). SPIK should decorate the cookies since operating income will be higher by $3,500 than if they sell them undecorated ("as is"). SPIK should sell undecorated cookies (as is) since operating income will be higher by 5500 than if they sell them decorated ("processed further"), SPIK should sell undecorated cookies (as is) since operating income will be higher by $3,500 than if they sell them decorated ("processed further