The Twisty Tie Dye Co. produces a single product; a plush poncho made of Italian cashmere. The company has provided the following data for its most recent year of operations.

Number of Units Produced	10,000
Direct labor	$55 per unit
Direct materials	$60 per unit
Variable manufacturing overhead	$5 per unit
Variable selling and administrative expense	$10 per unit
Fixed manufacturing overhead (total cost)	$120,000
Fixed selling and administrative expense (total cost)	$60,000

The unit cost, under both absorption costing and variable costing, would be

1)	$132 per unit under variable costing and $120 per unit under absorption costing.

2)	$120 per unit under variable costing and $132 per unit under absorption costing.

3)	$120 per unit under variable costing and $142 per unit under absorption costing.

4)	$130 per unit under variable costing and $142 per unit under absorption costing.

The Petty Co. is considering the following three investment projects.

Use the following information to answer the question:

	American Girl	Free Falling	Breakdown
Present value of cash inflows	$23,200	$58,200	$78,000
Investment Required	$20,000	$48,000	$76,000

Regarding the Net Present Value, which statement is true?

1)	Based on NPV, the Breakdown Project ranks highest.

2)	Based on NPV, the American Girl Project ranks lowest.

3)	Based on NPV, the Free Falling Project ranks the highest.

4)	None of the above.

Use the following information to answer the question:

	American Girl	Free Falling	Breakdown
Present value of cash inflows	$23,200	$58,200	$78,000
Investment Required	$20,000	$48,000	$76,000

Regarding the Profitability Index (PI), which statement is true?

1)	American Girl Projects PI is .16.

2)	American Girl Projects PI is .862.

3)	American Girl Projects PI is 1.16.

4)	None of the above.

The Pearl Jam Corporation has two divisions: the Eddie Division and the Vedder Division. The Eddie Division has sales of $230,000, variable expenses of $131,100, and traceable fixed expenses of $63,300. The Vedder Division has sales of $540,000, variable expenses of $307,800, and traceable fixed expenses of $120,700. The total amount of common fixed expenses not traceable to the individual divisions is $119,200.

The companys net operating income is:

1)

$147,100.

2)

$331,100.

3)

$211,900.

4)

$27,900.