Question : 21.QRC Company trying to decide which one of two alternatives : 1257160

 

 

21.QRC Company is trying to decide which one of two alternatives it will accept. The costs and revenues associated with each alternative are listed below:  What is the differential revenue for this decision?   

A. $25,000

 

B. $12,500

 

C. $62,500

 

D. $75,000

 

 

22.Ethan paid $3 for a bottle of ThirstAid. Later while on a hiking trip, she was offered $8 for the ThirstAid. Select the correct statement from the following:   

A. The $8 offer is not relevant if Ethan refuses to sell the ThirstAid.

 

B. If Ethan drinks the ThirstAid, no opportunity cost is associated with his decision.

 

C. The $3 original purchase price is irrelevant to his decision to sell the ThirstAid.

 

D. All of these.

 

 

23.The benefits sacrificed when one alternative is chosen over another are referred to as:   

A. Avoidable costs.

 

B. Opportunity costs.

 

C. Sacrificial costs.

 

D. Beneficial costs.

 

 

24.Lindsay purchased a raffle ticket for $5. Just before the grand prize drawing two people tried to buy her ticket. The first person offered $30, and another offered $65. What is Lindsay’s opportunity cost of keeping the raffle ticket?   

A. $60

 

B. $65

 

C. $90

 

D. $95

 

 

25.Select the correct statement regarding opportunity costs.   

A. Opportunity costs need not be considered in decision making.

 

B. Opportunity costs are not recorded in a firm’s financial accounting records.

 

C. Opportunity costs represent sunk costs.

 

D. All of these.

 

 

26.Select the incorrect statement concerning opportunity costs.   

A. Opportunity costs are relevant costs.

 

B. Opportunity costs are cumulative.

 

C. Opportunity costs are future oriented.

 

D. Opportunity costs are not recorded in the books.

 

 

27.Select the correct statement regarding quantitative and qualitative information.   

A. To be relevant, qualitative data need not be quantified.

 

B. Relevant information cannot have both quantitative and qualitative characteristics.

 

C. Qualitative data should only be considered when quantitative data are inconclusive.

 

D. To be relevant, qualitative data need not differ between the alternatives but must be future oriented.

 

 

28.Qualitative information is relevant when:   

A. it makes a difference in the decision and it differs between the alternatives.

 

B. it differs between the alternatives only.

 

C. it makes a difference in the decision only.

 

D. None of these.

 

 

29.Which of the following items is qualitative?   

A. Cost of new machine

 

B. Depreciation of existing machine

 

C. Book value of the existing machine

 

D. Degree to which the new machine can be integrated with existing machinery

 

 

30.The cost that is avoided when a company eliminates a single item of a product or service is a:   

A. Unit-level cost.

 

B. Facility-level cost.

 

C. Product-level cost.

 

D. Batch-level cost.