Question : 21.Jacob a department manager who recently instituted a new recognition : 1257209

 

 

21.Jacob is a department manager who recently instituted a new recognition program for his employees. He budgeted the cost of the new program at $10 per employee, but actual costs were $15 per employee. The cost associated with the recognition program would be considered which of the following kinds of cost?   

A. Controllable cost

 

B. Opportunity cost

 

C. Fixed cost

 

D. Product cost

 

 

22.Select the incorrect statement concerning the application of the controllability concept to responsibility accounting.   

A. As a practical matter, control of costs or revenues may be shared rather than absolute.

 

B. The concept of control is crucial to an effective responsibility accounting system.

 

C. Managers lose motivation when they are held accountable for actions that are beyond their scope of control.

 

D. Each manager should be evaluated on the costs but not the revenues that are under his or her control.

 

 

23.Stephanie’s responsibility report includes the salary and benefits of her secretary. Although Stephanie prepares a performance evaluation for the secretary each year, Stephanie’s superior determines how much the secretary will be paid. This example is an illustration of the fact that:   

A. Responsibility reporting systems are not perfect.

 

B. Managers sometimes are held responsible for items over which they have only limited control.

 

C. Control may be shared.

 

D. All of these.

 

 

24.Which of the following statements about return on investment (ROI) is false?   

A. ROI = margin divided by investment turnover.

 

B. ROI is used to measure the performance of investment centers.

 

C. Seeking to maximize ROI can result in a conflict between the interest of a particular manager and the interest of the business as a whole.

 

D. Companies may minimize motivational problems by using original cost instead of book value in the denominator of the ROI formula.

 

 

25.Huang Company reported the following information for 2014:  The company’s return on investment for 2014 was:   

A. 10%.

 

B. 6.25%.

 

C. 16%.

 

D. Cannot be ascertained from the information provided.

 

 

26.Campbell Candy Corporation desires a 16% return on investment (ROI) on all operations. The following information was available for the company in 2014:  What is the corporation’s ROI?   

A. 16.8%

 

B. 28%

 

C. 32%

 

D. Impossible to determine from the information given.

 

 

27.Joseph Company has an investment in assets of $450,000, income that is 10% of sales, and an ROI of 18%. From this information the amount of income would be:   

A. $81,000.

 

B. $45,000.

 

C. $2,500,000.

 

D. Impossible to determine from the information given.

 

 

28.The Family Restaurant chain had a 12% return on a $60,000 investment in new ovens. The investment resulted in increased sales and an increase in income that was 3% of the increase in sales. The increase in sales was:   

A. $7,200.

 

B. $15,000.

 

C. $180,000.

 

D. $240,000.

 

 

29.Willis Company made a $200,000 investment in new machinery. Assuming the company’s margin is 4%, what income will be earned if the investment generates $600,000 in additional sales?   

A. $80,000.

 

B. $24,000.

 

C. $400,000.

 

D. None of these.

 

 

30.The Perez Company had a 12.5% return on a $100,000 investment in new equipment. The investment resulted in increased sales, and the resultant increase in income amounted to 5% of sales. The turnover(asset utilization) was:   

A. 1.

 

B. 17.5.

 

C. 2.5.

 

D. 7.5.