Homework Answers
Question 16: True
Profit center is a responsibility center where the manager has the responsibility and authority to take decisions on both costs and revenue.
Question 17: True
Top level management can put a minimum amount of divisional income from operations by establishing minimum rate of return.
Question 18: True
Service department expenses are similar to that of profit center.
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UUTINI ate.. QUESTION 16 A responsibility center in which the authority over and responsibility for costs...
The responsibility center in which the manager has responsibility and authority over revenues and costs, but...
The responsibility center in which the manager has responsibility and authority over revenues and costs, but not assets, is the Multiple Choice revenue center investment center, profit center. cost center The minimum required rate of return for a project is the: Multiple Choice Ο accounting rate of return. Ο hurdle rate. Ο annual rate of return. Ο internal rate of return.
QUESTION 19 The basic objective of responsibility accounting is to charge each manager with those costs...
QUESTION 19 The basic objective of responsibility accounting is to charge each manager with those costs and/or revenues over which he has control O True O False QUESTION 20 A segment of a business responsible for both revenues and expenses would be called: 1. a cost center. 2. an investment center. 3. a profit center. 4. an incentive center. QUESTION 21 An profit center is a business segment whose manager has control over costs, revenues, and investments in operating assets....
14. A res and authority over costs and revenues is called a(n) a. profit center b....
14. A res and authority over costs and revenues is called a(n) a. profit center b. investment center ponsibility center in which the department manager has responsibility for volume center cost center that represent levels of operation that can be attained with reasonable effort are called a. theoretical standards b. ideal standards variable standards normal standards d. If at the end of the fiscal year, the variances from standard are significant, the variances should be transferred to the 16. work...
QUESTION 29 A company is analyzing the performance of responsibility centers. Controllable costs would be included...
QUESTION 29 A company is analyzing the performance of responsibility centers. Controllable costs would be included in the performance reports of which of the following types of responsibility centers? Profit Centers No Yes Yes No Investment centers No A) B) C) D) Yes Yes A) ОВ) o C) o D) QUESTION 30 Profit center managers are often evaluated using return on investment (ROl) or residual income measures. O True False QUESTION 31 An opportunity cost is the potential benefit that...
QUESTION 12 Three measures of investment center performance are income from operations, rate of return on...
QUESTION 12 Three measures of investment center performance are income from operations, rate of return on investment, and residual income. True False QUESTION 13 If divisional income from operations is $100,000, invested assets are $850,000, and the minimum rate of return on invested assets is 8%, the residual income is $68,000. True False QUESTION 14 A decentralized business organization is one in which all major planning and operating decisions are made by top management True False QUESTION 15 Click Save...
QUESTION 19 To calculate Income from Operations, total service department charges are A. added to Income...
QUESTION 19 To calculate Income from Operations, total service department charges are A. added to Income from Operations Before Service Department Charges. B. subtracted from Operating Expenses. C. subtracted from Income from Operations Before Service Department Charges. D. subtracted from Gross Profit Margin. QUESTION 20 Identify the formula for the rate of return on investment: A. Invested Assets/income from Operations B. Sales/Invested Assets C. Income from Operations/Sales D. Income from Operations/Invested Assets QUESTION 21 If divisional income from operations is...
True or False 1.A profit center is an organizational segment in which the manager is responsible...
True or False 1.A profit center is an organizational segment in which the manager is responsible for costs and revenues, but not investments in assets. 2.Operating assets would include office buildings leased to other companies. 3.Residual income is the portion of income produced by the division that is not related to its daily activities. 4.Although economic value added (EVA) is similar to residual income, adjustments are made to the financial information to better reflect the economic results of the division....
QUESTION 1 Responsibility accounting is a system in which a manager is held responsible for those...
QUESTION 1 Responsibility accounting is a system in which a manager is held responsible for those items of revenues and costs-and only those items-that the manager can control to a significant extent. O True O False QUESTION 2 The sales volume in units that are needed to achieve a specific Target Profit can be calculated by Dividing the dollars of fixed costs by the unit contribution margin Dividing the dollars of fixed costs and target profit by the unit contribution...
QUESTION 32 Which of the following three statements are correct? I. A profit center has control...
QUESTION 32 Which of the following three statements are correct? I. A profit center has control over both cost and revenue. Il. An investment center has control over invested funds, but not over costs and revenue. IIA cost center has no control over sales o only Only Only I and II Only I and I QUESTION 33 The Freed Company produces three products, X, Y, Z, from a single raw material input. Product Y can be sold at the splitoff...
Question 50 If sales are $820,000, variable costs are 55% of sales, and operating income is...
Question 50 If sales are $820,000, variable costs are 55% of sales, and operating income is $260,000, what is the contribution margin ratio? a. 55% b. 32% c. 45% d. 62% 1 points Question 51 The three most common cost behavior classifications are a. variable costs, period costs, and differential costs b. variable costs, product costs, and sunk costs c. fixed costs, variable costs, and mixed costs d. variable costs, sunk costs, and opportunity costs 1 points Question 52 In...
The responsibility center in which the manager has responsibility and authority over revenues and costs, but not assets, is the Multiple Choice revenue center investment center, profit center. cost center The minimum required rate of return for a project is the: Multiple Choice Ο accounting rate of return. Ο hurdle rate. Ο annual rate of return. Ο internal rate of return.
QUESTION 19 The basic objective of responsibility accounting is to charge each manager with those costs and/or revenues over which he has control O True O False QUESTION 20 A segment of a business responsible for both revenues and expenses would be called: 1. a cost center. 2. an investment center. 3. a profit center. 4. an incentive center. QUESTION 21 An profit center is a business segment whose manager has control over costs, revenues, and investments in operating assets....
14. A res and authority over costs and revenues is called a(n) a. profit center b. investment center ponsibility center in which the department manager has responsibility for volume center cost center that represent levels of operation that can be attained with reasonable effort are called a. theoretical standards b. ideal standards variable standards normal standards d. If at the end of the fiscal year, the variances from standard are significant, the variances should be transferred to the 16. work...
QUESTION 29 A company is analyzing the performance of responsibility centers. Controllable costs would be included in the performance reports of which of the following types of responsibility centers? Profit Centers No Yes Yes No Investment centers No A) B) C) D) Yes Yes A) ОВ) o C) o D) QUESTION 30 Profit center managers are often evaluated using return on investment (ROl) or residual income measures. O True False QUESTION 31 An opportunity cost is the potential benefit that...
QUESTION 12 Three measures of investment center performance are income from operations, rate of return on investment, and residual income. True False QUESTION 13 If divisional income from operations is $100,000, invested assets are $850,000, and the minimum rate of return on invested assets is 8%, the residual income is $68,000. True False QUESTION 14 A decentralized business organization is one in which all major planning and operating decisions are made by top management True False QUESTION 15 Click Save...
QUESTION 19 To calculate Income from Operations, total service department charges are A. added to Income from Operations Before Service Department Charges. B. subtracted from Operating Expenses. C. subtracted from Income from Operations Before Service Department Charges. D. subtracted from Gross Profit Margin. QUESTION 20 Identify the formula for the rate of return on investment: A. Invested Assets/income from Operations B. Sales/Invested Assets C. Income from Operations/Sales D. Income from Operations/Invested Assets QUESTION 21 If divisional income from operations is...
QUESTION 1 Responsibility accounting is a system in which a manager is held responsible for those items of revenues and costs-and only those items-that the manager can control to a significant extent. O True O False QUESTION 2 The sales volume in units that are needed to achieve a specific Target Profit can be calculated by Dividing the dollars of fixed costs by the unit contribution margin Dividing the dollars of fixed costs and target profit by the unit contribution...
QUESTION 32 Which of the following three statements are correct? I. A profit center has control over both cost and revenue. Il. An investment center has control over invested funds, but not over costs and revenue. IIA cost center has no control over sales o only Only Only I and II Only I and I QUESTION 33 The Freed Company produces three products, X, Y, Z, from a single raw material input. Product Y can be sold at the splitoff...
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