Question 1.1.(TCO 7) When companies do not want to use market prices or find it too costly, they typically use __________ prices, even though suboptimal decisions may occur.(Points : 3)<\/p>\n
average-cost<\/p>\n
full-cost<\/p>\n
long-run cost<\/p>\n
short-run average cost<\/p>\n
Question 2.2.(TCO 7) The price of movie tickets for opening day and the few days following compared to the price six months later is an example of(Points : 3)<\/p>\n
price gouging.<\/p>\n
peak-load pricing.<\/p>\n
dumping.<\/p>\n
demand elasticity.<\/p>\n
Question 3.3.(TCO 7) The amount of markup percentage is usually higher if (Points : 3)<\/p>\n
demand is elastic.<\/p>\n
competition is intense.<\/p>\n
there is idle capacity.<\/p>\n
demand is strong.<\/p>\n
Question 4.4.(TCO 7) An understanding of life-cycle costs can lead to(Points :3)<\/p>\n
additional costs during the manufacturing cycle<\/p>\n
less need for evaluation of the competition<\/p>\n
cost-effective product designs that are easier to service<\/p>\n
mutually beneficial relationships between buyers and sellers.<\/p>\n
Question 5.5.(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.<\/p>\n
The markup percentage on full cost to arrive at the target (existing) selling price is (Points : 3)<\/p>\n
25%<\/p>\n
75%<\/p>\n
80%<\/p>\n
20%<\/p>\n
Question 6.6.(TCO 8) A product may be passed from one subunit to another subunit in the same organization. The product is known as(Points : 3)<\/p>\n
an interdepartmental product.<\/p>\n
an intermediate product.<\/p>\n
a subunit product.<\/p>\n
a transfer product.<\/p>\n
Question 7.7.(TCO 8) Transfer prices should be judged by whether they promote(Points : 3)<\/p>\n
goal congruence.<\/p>\n
the balanced scorecard method<\/p>\n
a high level of subunit autonomy in decision making<\/p>\n
Both 1 and 3 are correct<\/p>\n
Question 8.8.(TCO 8) A benefit of using a market-based transfer price is the(Points : 3)<\/p>\n
profits of the transferring division are sacrificed for the overall good of the corporation<\/p>\n
profits of the division receiving the products are sacrificed for the overall good of the corporation<\/p>\n
economic viability and profitability of each division can be evaluated individually<\/p>\n
None of the above<\/p>\n
Question 9.9.(TCO 8) The range over which two divisions will negotiate a transfer price is(Points : 3)<\/p>\n
between the supplying division’s variable cost and the market price of the product<\/p>\n
between the supplying division’s variable cost and its full cost of the product<\/p>\n
anywhere above the supplying division’s full cost of the product<\/p>\n
between the supplying division’s full cost and 180% above its full cost<\/p>\n
Question 10.10.(TCO 8) Division A sells soybean paste internally to Division B, which in turn, produces soybean burgers that sell for $5 per pound. Division A incurs costs of $0.75 per pound while Division B incurs additional costs of $2.50 per pound. Which of the following formulas correctly reflects the company’s operating income per pound?(Points : 3)<\/p>\n
$5.00 – ($1.25 + $2.50) = $1.25<\/p>\n
$5.00 – ($0.75 + $2.50) = $1.75<\/p>\n
$5.00 – ($0.75 + $3.75) = $0.50<\/p>\n
$5.00 – ($0.25 + $1.25 + $3.50) = 0<\/p>\n","protected":false},"excerpt":{"rendered":"
Question 1.1.(TCO 7) When companies do not want to use market prices or find it too costly, they typically use __________ prices, even though suboptimal decisions may occur.(Points : 3) average-cost full-cost long-run cost short-run average cost Question 2.2.(TCO 7) Read More …<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-70434","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts\/70434","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/comments?post=70434"}],"version-history":[{"count":0,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts\/70434\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/media?parent=70434"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/categories?post=70434"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/tags?post=70434"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}