5. (TCO 7) Each month, Haddon Company has $275,000 total manufacturing costs (20

Question

5. (TCO 7) Each month, Haddon Company has $275,000 total manufacturing costs (20% fixed) and $125,000 distribution and marketing costs (36% fixed). Haddon's monthly sales are $500,000.

The markup percentage on full cost to arrive at the target (existing) selling price is
(Points : 3)
25%.
75%.
80%.
20%.

6. (TCO 8) The benefits of a decentralized organization are greater when a company (Points : 3)
is large and unregulated.
is facing great uncertainties in their environment.
has few interdependencies among division.
All of the above

7. (TCO 8) A transfer-pricing method leads to goal congruence when managers (Points : 3)
always act in their own best interest.
act in their own best interest and the decision is in the long-term best interest of the manager's subunit.
act in their own best interest and the decision is in the long-term best interest of the company.
act in their own best interest and the decision is in the short-term best interest of the company.

Explanation / Answer

the answer will definitely be option 5. 25% 6. All the above 7. act in their own best interest and the decision is in the long-term best interest of the company.

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