Question : 31) Other than price, what other items should Heck’s Kitchens : 1216923

31) Other than price, what other items should Heck’s Kitchens consider before accepting this one-time-only special order?

A) reaction of shareholders

B) reaction of existing customers to the lower price offered to Mr. Louis Cifer

C) demand for cherry cabinets

D) price is the only consideration

32) If Louis Cifer wanted a long-term commitment for supplying this product, this analysis:

A) would definitely be different

B) may be different

C) would not be different

D) does not contain enough information to determine if there would be a difference

33) An example of a quantitative factor for the decision-making process is:

A) customer satisfaction

B) employee morale

C) product quality

D) manufacturing overhead

Answer the following questions using the information below:

Black Forrest manufactures rustic furniture. The cost accounting system estimates manufacturing costs to be $180 per table, consisting of 80% variable costs and 20% fixed costs. The company has surplus capacity available. It is Back Forrest’s policy to add a 50% markup to full costs.

34) Black Forrest is invited to bid on a one-time-only special order to supply 100 rustic tables. What is the lowest price Black Forrest should bid on this special order?

A) $12,600

B) $14,400

C) $18,000

D) $23,000

35) A large hotel chain is currently expanding and has decided to decorate all new hotels using the rustic style. Black Forrest Incorporated is invited to submit a bid to the hotel chain. What is the lowest price per unit Black Forrest should bid on this long-term order?

A) $126

B) $144

C) $180

D) $270

36) Zephram Corporation has a plant capacity of 200,000 units per month. Unit costs at capacity are:

Direct materials$4.00

Direct labor6.00

Variable overhead3.00

Fixed overhead1.00

Marketing?fixed7.00

Marketing/distribution?variable3.60

Current monthly sales are 190,000 units at $30.00 each. Q, Inc., has contacted Zephram Corporation about purchasing 2,000 units at $24.00 each. Current sales would not be affected by the one-time-only special order. What is Zephram’s change in operating profits if the one-time-only special order is accepted?

A) $14,800 increase

B) $17,200 increase

C) $22,000 increase

D) $33,200 increase

($24.00 – $16.60) × 2,000 = $14,800 increase

37) The sum of all the costs incurred in a particular business function (for example, marketing) is called the:

A) business function cost

B) full product cost

C) gross product cost

D) multiproduct cost

38) The sum of all costs incurred in all business functions in the value chain (product design, manufacturing, marketing, and customer service, for example) is known as the:

A) business cost

B) full product cost

C) gross product cost

D) multiproduct cost

39) An example of a qualitative factor for the decision-making process is:

A) customer satisfaction

B) units sold

C) material cost

D) labor hours incurred

40) Outsourcing is:

A) purchasing goods and services internally

B) never a viable option

C) more desirable than insourcing

D) purchasing goods and services from outside vendors