Objective 22.6   1) When companies do not want to use market prices or find it too costly, they typically use ________ prices, even though suboptimal decisions may occur. A) average-cost B) full-cost C) long-run cost D) short-run average cost   2) Aerated Water Company makes internal transfers at 180% of full cost. The Soda Refining Division purchases 30,000 containers of carbonated water per […]

  91. Production and sales estimates for April are as follows:  Estimated inventory (units), April 1 9,000 Desired inventory (units), April 30 8,000 Expected sales volume (units):     Area A 3,500   Area B 4,750   Area C 4,250 Unit sales price $20     The budgeted total sales for April is: A. $200,000B. $230,000C. $270,000D. $250,000 92. If the expected sales volume for the current period is 7,000 units, the desired ending inventory […]

  141. For 2008, net income is $250,000, shares outstanding are 80,000, and the market price is $24. What is the price-earnings ratio on common stock (round to one decimal point?) A. 3.1B. 7.7C. 34.9D. 2.5 142. Based on the following information, what is Company B’s price-earnings ratio?    Company A Company B Market price per share $70.00 $85.00 Earnings per share 14.00 11.00 Dividends per share 0.05 0.10 Investor’s cost per […]

    130.On December 31, a company needed to estimate its ending inventory to prepare its annual financial statements. The following information is currently available:Inventory as of January 1: $120,500Net sales for the year: $400,000Net purchases for the year: $270,500This company typically achieves a gross profit ratio of 15%. Ending Inventory under the gross profit method would be:    A.$102,425.   B.$10,425.   C.$9,000.   D.$51,000. […]

  Multiple Choice Questions   21. Which of the following describes the primary objective of the balance sheet?  A. To measure the net income of a business up to a particular point in time. B. To report the difference between cash inflows and cash outflows for the period. C. To report the financial position of the reporting entity at a particular point in time. D. To report the market value […]

  126.All of the following statements regarding recognition of receivables under U.S. GAAP and IFRS are true except:    A.U.S. GAAP and IFRS have similar asset criteria that apply to recognition of receivables. B.Receivables that arise from revenue-generating activities are subject to broadly similar criteria for U.S. GAAP and IFRS. C.The realization principle under GAAP implies an arm’s length transaction occurs. D.GAAP refers to the earnings […]

  Objective 18.4   1) The inspection point is the: A) stage of the production cycle where products are checked to determine whether they are acceptable or unacceptable units B) point at which costs are allocated between normal and abnormal spoilage C) point at which the calculation of equivalent units is made D) None of these answers is correct.   2) When spoiled goods have […]

  10) Under GAAP, for the purposes of calculating inventory costs, product costs include ________. A) all costs incurred along the value chain B) design costs C) only inventoriable costs D) only research and development costs   11) Product costs used for government contracts generally include ________. A) marketing costs, and customer service costs B) design costs and production costs C) all the costs for […]

  132.All of the following are examples of facility level costs except:    A. Costs of cleaning the workplace. B. Costs of custodial work. C. Costs of personnel support. D. Costs of receiving shipments. E. Costs of providing electricity. 133._____________ costs support the company as a whole.    A. Batch-level B. Product-level C. Unit-level D. Facility-level 134.Which of the following is a disadvantage of the departmental overhead rate method?    A. It may fail to accurately assign many […]

  11) Which of the following is a measure of the customer perspective? A) return on investment B) market share in the high-end appliance market C) development of new products or services D) production cycle time E) revenue growth 12) Which of the following is a measure of the internal business perspective? A) return on investment B) market share in the high-end appliance market C) […]