31. Select one: a. $5,500 less than if the company bought the part b. $5,500 gre

Question

31.

Select one:

a. $5,500 less than if the company bought the part

b. $5,500 greater than if the company bought the part

c. 9,500 greater than if the company bought the part

d. $111,500 greater than if the company bought the part

Question 32

Select one:

a. Make the new product and buy the part to earn an extra $1.00 per unit contribution to profit.

b. Make the new product and buy the part to earn an extra $4.00 per unit contribution to profit.

c. Continue to make the part to earn an extra $3.00 per unit contribution to profit.

d. Continue to make the part to earn an extra $8.00 per unit contribution to profit.

Question 33

The benefit foregone by choosing a particular alternative course of action is referred to as a(n)

Select one:

a. sunk cost.

b. opportunity cost.

c. variable cost.

d. incremental cost.

Question 34

In making the decision whether to sell a product as is or process the product further, the expected income from selling the product as is may be defined as which of the following?

Select one:

a. The opportunity cost of processing the product further

b. A sunk cost of processing the product further

c. The opportunity cost of selling the product as is

d. A limiting factor in processing the product further

Question 35

Which of the following would be a consideration for "sell as is or process further" decisions?

Select one:

a. Revenue generated if sold "as is"

b. Revenue generated if "further processed"

c. Costs involved in further processing

d. All of these

Question 36

Bear Country Granola is considering selling premium granola. It already sells regular for $6.75/pound and would sell premium granola for $9.50/pound. The cost for organic grains for the premium granola would be $1.15/pound. A cost that would not be considered in this decision would be

Select one:

a. the extra revenue generated by selling premium.

b. the cost of refining the regular granola.

c. the cost of further processing the regular granola into premium granola.

d. Any of these would be considered.

Question 37

Upscale Dishwear manufactures two products, salad plates and platters, from a joint process. Salad plates are allocated $7,500 of the total joint costs of $25,000. There are 3,000 salad plates produced and 3,000 platters produced each year. Salad plates can be sold at the split-off point for $12 per unit, or they can be hand painted for additional processing costs of $8,400 and sold for $16 for each deluxe salad plate. If the salad plates are processed further and made into deluxe plates, the effect on operating income would be:

Select one:

a. $36,000 net increase in operating income.

b. $3,600 net decrease in operating income.

c. $36,000 net decrease in operating income.

d. $3,600 net increase in operating income.

Question 38

Select one:

a. $2,800 net decrease in operating income

b. $5,000 net decrease in operating income

c. $5,000 net increase in operating income

d. $2,800 net increase in operating income

Question 39

Jackie has the following information to evaluate-her current salary of $74,000 versus total revenues of $100,000 and expenses of $65,000 from starting a new business. How much is the opportunity cost associated with staying at her current job?

Select one:

a. $35,000

b. $165,000

c. $74,000

d. $(9,000)

Explanation / Answer

35)

option D

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