Acct 505 Week 8 Final Exam Set 3 Essay

2616 Words Jan 17th, 2016 11 Pages
ACCT 505 WEEK 8 FINAL EXAM SET 3
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ACCT 505 WEEK 8 FINAL EXAM SET 3
ACCT 505 Week 8 Final Exam Set 3
1. Problem:
2. The gross margin of Evans Retail Stores, Inc. for the first quarter is:………
3. The contribution margin of Evans Retail Stores, Inc. for the first quarter is:…….
4. The contribution margin of Evans Retail Stores, Inc. for the first quarter is:…….
5. The total contribution margin decreases if sales volume remains the same and:…….
6. A company has provided the following data:……
7. Wallace, Inc., prepared the following budgeted data based on a sales forecast of
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27. One of the dangers of allocating common fixed costs to a product line is that such allocations can make the line appear less profitable than it really is.
28. In responsibility accounting, each segment in an organization should be charged with the costs for which it is responsible and over which it has control plus its share of common organizational costs.
29. Some managers believe that residual income is superior to return on investment as a means of measuring performance, since it encourages the manager to make investment decisions that are more consistent with the interests of the company as a whole.
30. The performance of the manager of Division A is measured by residual income. Which of the following would increase the manager’s performance measure?
31. A segment of a business responsible for both revenues and expenses would be called:
32. The Northern Division of the Smith Company had average operating assets totaling $150,000 last year. If the minimum required rate of return is 12%, and if last year’s net operating income at Northern was $20,000, then the residual income for Northern last year was:
33. Company A’s residual income is:
34. Gata Co. plans to discontinue a department that has a $48,000 contribution margin and $96,000 of fixed costs. Of these fixed costs, $42,000 cannot be avoided. What would be the effect of this discontinuance on Gata’s overall net operating income?
35. Pitkin Company produces a part

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