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“56. RedRock Company uses flexible budgeting for cost control. RedRock produced 10,800 units of product during October, incurring indirect material costs of $13,000. Its master budget for the year reflected indirect material costs of $180,000 at a production volume of 144,000 units. A flexible budget for October production would reflect indirect material costs of: a. $13,000. b. $13,500. c. $13,975. d. $11,700. e. $15,000.”,”2Indirect materials per unit from the budget = Indirect Material Costs / Production Volume = 180,000 = $1.25 /unit 144,000Flexible budget:Units of product x Indirect materials per unit = Indirect material costs10,800 x $1.25 = $13

Managerial Accounting

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57. Which of the following statements regarding return on investment is true? a. An increase in sales would affect the margin but not the turnover. b. JIT purchasing and JIT manufacturing could adversely affect the return on investment of companies adopting these methods. c. Accelerating the collection of accounts receivable and using cash collected to pay short-term creditors could help to increase the return on investment. d. The term operating assets is defined as plant and equipment for purposes of calculating return on investment.

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.57. Which of the following[…]

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60. Which of the following regarding relevant cost analysis is true? a. A contribution income statement should be prepared as part of every relevant cost analysis. b. A contribution income statement considers all costs and can result in arriving at a different and more accurate answer than that obtained by simply isolating relevant costs. c. A contribution income statement tends to focus the attention of the decision maker directly on the problems critical to the decision at hand. d. All of the above are true. e. None of the above is true.

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.60. Which of the following[…]

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61. Which of the following regarding vertical integration is not correct? a. Vertical integration assists a firm in controlling the quality of parts and materials used in the production process. b. Vertical integration could result in a company with insufficient capacity being unable to obtain parts and materials during periods of heavy product demand. c. Vertical integration may tend to direct attention away from periodic review of the make or buy decision for certain parts or materials. d. All of the above are true. e. None of the above is true.

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.61. Which of the following[…]

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“62. To maximize total contribution margin, a firm should: a. promote those products having the highest unit contribution margins. b. promote those products having the highest contribution margin ratios. c. promote those products having the highest contribution margin per unit of a constrained resource. d. promote those products having the highest contribution margins and contribution margin ratios.”

Managerial Accounting

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63. A plant operating at capacity would suggest that: a. every machine and person in the plant is working at the maximum possible rate. b. only some specific machines or processes must be operating at the maximum rate possible. c. fixed costs will need to change to accommodate increased demand. d. managers should produce those products with the highest contribution margin in order to deal with the constrained resource.

Managerial Accounting

Average Rating 0 out of 5 stars. 0 votes.You must log in to submit a review.63. A plant operating at[…]

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