Question : 53.Responsibility margin equal to: A. Revenue, less contribution margin and traceable fixed : 1259676

 

 

53.Responsibility margin is equal to:   

A. Revenue, less contribution margin and traceable fixed costs.

 

B. Revenue, less variable costs.

 

C. Revenue, less variable costs and traceable fixed costs.

 

D. Revenue, less variable fixed costs, traceable fixed costs, and common costs.

 

 

 

 

54.Traceable fixed costs that the manager of a department cannot change are called:   

A. Controllable.

 

B. Committed.

 

C. Conditional.

 

D. Common.

 

 

 

 

55.Parker’s newly hired director of accounting services feels that the property taxes on the Cairo factory should be allocated to the fabricating, assembly, and finishing departments based upon the square footage they occupy. Of the following, which is not a valid reason to reject this recommendation?   

A. The property taxes would not change even if one or more of the departments were eliminated.

 

B. Such an allocation violates GAAP.

 

C. The property taxes are not under the control of department managers.

 

D. The allocation may imply changes in efficiency that are unrelated to center performance.

 

 

 

 

56.Sloan Sporting Goods has stores in four geographic regions. Each region has at least 20 stores. In the company’s responsibility accounting system, sales are recorded separately for each sales department within each store. The total sales for a particular region are determined by:   

A. Combining the total sales of all stores in that region.

 

B. Using a separate revenue account to record the sales transaction for each region.

 

C. Taking a percentage of the company’s total sales that is equal to the percentage of the company’s stores located in that region.

 

D. Adding together the sales tickets for all sales transactions in the region.

 

 

 

 

57.Depreciation on the factory would be an example of a:   

A. Controllable fixed cost.

 

B. Period cost.

 

C. Responsibility cost.

 

D. Committed fixed cost.

 

 

 

 

58.The concept of contribution margin applies:   

A. Only to investment centers.

 

B. Only to profit centers.

 

C. Only to cost centers.

 

D. To all types of responsibility centers.

 

 

 

 

59.In a responsibility income statement, the term common fixed costs describes fixed costs that:   

A. Are under the manager’s immediate control.

 

B. Jointly benefit several responsibility centers of the business.

 

C. Occur in virtually every responsibility center of the business (such as salaries).

 

D. Are easily traceable to specific profit centers.

 

 

 

60.Refer to the information above. Of the following, which should be classified as a common fixed cost?   

A. Depreciation on the Schenectady factory.

 

B. Salaries of the plant managers.

 

C. Salaries of the company’s legal staff.

 

D. Property taxes on the Akron factory.

 

 

 

 

61.Refer to the information above. The company’s CEO must decide which of the three factories to expand in order to increase productive capacity. She should be most interested in the:   

A. Variable costs of each factory.

 

B. Contribution margin at each factory.

 

C. Fixed costs traceable to each factory.

 

D. Responsibility margins of each factory.

 

 

 

 

62.Refer to the information above. The Akron factory employs two quality control inspectors at an annual salary of $70,000 each. These salaries should be classified as:   

A. Common fixed cost.

 

B. Variable cost.

 

C. Committed fixed cost.

 

D. Controllable fixed cost.