Costs: Relevant, Differential, Avoidable

952 Words Jul 10th, 2013 4 Pages
1. The cost of a computer system installed last year is an example of: (Points: 2) a sunk cost a relevant cost a differential cost an avoidable cost

2. In evaluating different alternatives, it is useful to concentrate on: (Points: 2) variable costs fixed costs total costs relevant costs

3. Relevant costs in a make-or-buy decision of a part include: (Points: 2) setup overhead costs for the manufacture of the product using the outsourced part currently used manufacturing capacity that has alternative uses when part is outsourced annual plant insurance costs that will remain the same corporate office costs that will be
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Relevant costs in a make-or-buy decision of a part include: (Points: 2) setup overhead for the manufacture of the product using the outsourced part currently used manufacturing capacity that has alternative uses annual plant insurance costs that will remain the same corporate office costs that will be allocated differently

14. When deciding to accept a one-time-only special order from a wholesaler, management should do all of the following EXCEPT: (Points: 2) analyze product costs consider the impact of the special order on future prices of their products determine whether excess capacity is available verify past design costs for the product

15. When deciding whether to discontinue a segment of a business, managers should focus on: (Points: 2) equipment used by the segment that could become idle reallocation of corporate costs how total costs differ among alternatives operating income per unit of the discontinued segment

16. In ________, equipment is organized to accommodate the production of a specific product. (Points: 2) a process layout a product layout cellular manufacturing just-in-time production

17. Characteristics of a product layout include: (Points: 2) raw materials and purchased parts are
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