Chapter 13 test bank with answers Horngren\'s Cost Accounting: A Managerial Emphasis, 16th Global Edition PDF

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Cost Accounting: A Managerial Emphasis, 16e, Global Edition (Horngren)Chapter 13 Pricing Decisions and Cost Management13 Objective 13.1) As a general rule of economics, companies should only produce and sell units as long as ____. A) there is customer demand for the product B) there is a relatively ...

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Cost Accounting: A Managerial Emphasis, 16e, Global Edition (Horngren) Cha pt e r1 3 Pr i c i ngDec i s i onsa ndCos tManage me nt 1 3 . 1 Obj e c t i ve1 3 . 1 1 )Asage ne r a lr ul eofe c onomi c s ,c ompa ni e ss houl donl ypr oduc ea nds e l luni t sa sl ongas__ __ _ __ _. A)t he r ei sc us t ome rde mandf ort hepr oduc t B)t he r ei sar e l a t i ve l ys mal ls uppl yoft hepr oduc twhe nc ompa r e dt opas tope r a t i ngpe r i ods C)t her e ve nuef r om anaddi t i onaluni te x c e e dst hec os tofpr oduc i ngi t D)t he r ei sage ne r ouss uppl yofl owc os tdi r e c tma t e r i al s Ans we r :C Di ff: 2 Obj e c t i ve :1 AACSB:Anal yt i c a lt hi nki ng

2 )I ns e t t i ngpr i c e sf orpr oduc t sands e r vi c e s ,mana ge r sma ya t t e mptt oc har gewha tt hec us t ome ri s wi l l i ngt opa yhowe ve r ,t oohi ghapr i c ema y_ __ __ _ __ . A)de t e rac us t ome rf r om pur c ha s i ngapr oduc tands e e kal t e r na t i ve s B)i nc r e a s ede mandandde ma ndf ort hepr oduc t C)i ndi c a t es uppl yi st oopl e nt i f ul D)de c r e as eac ompe t i t or ' sma r ke ts har e Ans we r :A Di ff: 1 Obj e c t i ve :1 AACSB:Anal yt i c a lt hi nki ng

3 )Compa ni e smus tal wa yse xa mi net he i rpr i c i ng__ __ _ __ _. A)ba s e dont hes uppl yoft hepr oduc t B)bas e dont hef ul lc os tofpr oduc i ngt hepr oduc ta ndpr i c et omakeapr ofit C)t hr ought hee ye soft he i rc us t ome r sandt he nmana gec os t st opr oduc eapr ofit D)bas e dont heGAAPc os tofpr oduc i ngt hepr oduc tandt he naddama r k up Ans we r :C Di ff: 2 Obj e c t i ve :1 AACSB:Anal yt i c a lt hi nki ng

4 )Whi c hoft hef ol l owi ngs t a t e me nt si st r ueaboutt hef ac t or st ha ta ffe c tpr i c i ngde c i s i ons ? A)I nf or ma t i onaboutc ompe t i t or s ' t e c hnol ogi e si snotus e f ulf orpr i c i ngde c i s i ons . B)I nf or ma t i onaboutac ompe t i t ori nape r f e c tmar ke taffe c t spr i c i ngde c i s i ons . C)I nc r e as ei npr i c eofas ubs t i t ut epr oduc tdoe snotaffe c tpr i c i ngde c i s i ons . D)Mana ge r smus tal wa ysbea war eoft hec ompe t i t i onwhe npr i c i ngt he i rpr oduc t s Ans we r :D Di ff: 3 Obj e c t i ve :1 AACSB:Anal yt i c alt hi nki ng

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5 )I nape r f e c t l yc ompe t i t i vemar ke t ,whi c hoft hef ol l owi ngi sapr i ma r yf ac t ori nflue nc i ngpr i c i ng de c i s i ons ? A)c os tofpr oduc t i on B)a vai l a bi l i t yofr a w ma t e r i al si nt hema r ke t C)i nf or ma t i ononc ompe t i t or ' sc os ts t r uc t ur e D)val uec us t ome r spl a c eonpr oduc t Ans we r :D Di ff: 3 Obj e c t i ve :1 AACSB:Anal yt i c alt hi nki ng

6 )Whi c hoft hef ol l owi ngs t a t e me nt si st r ueoft hec os tofpr oduc i ngapr oduc t ? A)I tc ont r ol spr i c i ngi nhi ghl yc ompe t i t i vemar ke t s . B)I ta ffe c t st hewi l l i ngne s sofac ompa nyt os uppl yapr oduc t . C)I ti nc l ude smanuf a c t ur i ngc os t s , butnotpr oduc tde s i gnc os t sf orpr i c i ngde c i s i ons . D)I ti snotaf ac t ort obet a ke ni nt oa c c ountwhi l epr i c i ngapr oduc t . Ans we r :B Di ff: 3 Obj e c t i ve :1 AACSB:Anal yt i c alt hi nki ng

7 )I nanonc ompe t i t i vee nvi r onme nt ,t heke yf ac t oraffe c t i ngpr i c i ngde c i s i onsi st he_ _____ __. A)c us t ome r ' swi l l i ngne s st opa y B)pr i c ec har ge df ora l t e r na t i vepr oduc t s C)i nf or ma t i ononc ompe t i t or ' sc os ts t r uc t ur e D)mi ni mum pr i c eac c e pt abl et ot hefir m Ans we r :A Di ff: 3 Obj e c t i ve :1 AACSB:Anal yt i c alt hi nki ng

8 )Whi c hoft hef ol l owi ngs t a t e me nt si st r ueofc os t sa ndpr i c i ngde c i s i ons ? A)Compa ni e sge tpr ofitf r om s e l l i ngpr oduc t sonl ywhe nt he ya r et hepr i c emake r s . B)Compani e ss uppl ypr oduc t sasl ongast hepr i c et hec us t ome ri swi l l i ngt opa yf ori t spr oduc t se x c e e ds t hepr i c et ha ti sc har ge dbyt hec ompe t i t or . C)Compa ni e ss uppl ypr oduc t sasl ongast he r ei sade mandf ort hepr oduc ti nt hemar ke tr e gar dl e s sof t hepr i c ea twhi c ht hepr oduc t sar es ol d. D)Compani e ss uppl ypr oduc t sasl ongast her e ve nue sf r om s e l l i ngt headdi t i onaluni t se x c e e dt hec os tof pr oduc i ngt he m. Ans we r :D Di ff: 3 Obj e c t i ve :1 AACSB:Anal yt i c alt hi nki ng

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9 )Thr e ema j ori nflue nc e sonpr i c i ngde c i s i onsar e_ _____ __. A)c ompe t i t i on,c os t s , andc us t ome r s B)c ompe t i t i on,de ma nd,andpr oduc t i one ffic i e nc y C)c ont i nuousi mpr ove me nt ,c us t ome rs a t i s f ac t i on,a nds uppl y D)var i a bl ec os t s ,fixe dc os t s , andmi xe dc os t s Ans we r :A Di ff: 1 Obj e c t i ve :1 AACSB:Anal yt i c alt hi nki ng

1 0)Monopol i s t sc anc ha r gepr i c e swi t houtl i mi t a t i onsast he r ei snoc ompe t i t i onf ort hepr oduc tors e r vi c e t hemonopol i s tpr ovi de s . Ans we r :F ALSE Expl ana t i on:Thehi ghe rt hepr i c eamonopol i s ts e t s ,t hel owe rt hede ma ndbe c a us ec us t ome r swi l le i t he r s e e ks ubs t i t ut epr oduc t sorf or gobuyi ngt hepr oduc ta ndt he r e f or eal t hought hemonopol i s tha smor e l e e wa yt os e thi ghe rpr i c e st he r ear el i mi t s Di ff: 2 Obj e c t i ve :1 AACSB:Anal yt i c alt hi nki ng

1 1)Ac ompa nyope r a t i ngi nape r f e c t l yc ompe t i t i vemar ke tha smor el e e wa yt os e thi ghe rpr i c e st ha na fir mt ha ti samonopol i s t . Ans we r :F ALSE Expl ana t i on:Amonopol i s tha snoc ompe t i t or sandhasmuc hmor el e e wa yt os e thi ghpr i c e st hanafir m ope r a t i ngi nape r f e c t l yc ompe t i t i vemar ke t . Di ff: 2 Obj e c t i ve :1 AACSB:Anal yt i c alt hi nki ng

1 2)Forac ompa nyope r a t i ngi nape r f e c t l yc ompe t i t i vemar ke t , c os ti nf or ma t i onaffe c t st hepr i c i ng de c i s i onsoft hec ompany . Ans we r :F ALSE Expl ana t i on:Forac ompanyope r a t i ngi nape r f e c t l yc ompe t i t i vemar ke t ,c os ti nf or ma t i ondoe snota ffe c t t hepr i c i ngde c i s i onoft hec ompany ,i tonl yhe l psmana ge r sde c i det hequant i t yofout putt opr oduc et o maxi mi zeope r a t i ngi nc ome . Di ff: 3 Obj e c t i ve :1 AACSB:Anal yt i c alt hi nki ng

1 3)Fl uc t ua t i onsi ne x c hanger a t e sbe t we e ndi ffe r e ntc ount r i e s ' c ur r e nc i e sa ffe c tc os t sa ndpr i c i ng de c i s i onsofac ompany . Ans we r :TRUE Di ff: 2 Obj e c t i ve :1 AACSB:Anal yt i c alt hi nki ng

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1 4)I nma r ke t swi t hl i t t l eornoc ompe t i t i on,t heke yf a c t ora ffe c t i ngpr i c ei st hec os tofpr oduc t i ont ot he c ompa ny . Ans we r :F ALSE Expl ana t i on:I nmar ke t swi t hl i t t l eornoc ompe t i t i on,t heke yf ac t ora ffe c t i ngpr i c ei st hec us t ome r s ' wi l l i ngne s st opa y , notc os t sorc ompe t i t or s . Di ff: 2 Obj e c t i ve :1 AACSB:Anal yt i c alt hi nki ng

1 5)Theval uec us t ome r spl a c eonapr oduc ta ndt hepr i c e sc ha r ge df orc ompe t i ngpr oduc t sa ffe c tde mand a ndt hec os tofpr oduc i nga ndde l i ve r i ngt hepr oduc taffe c ts uppl y . Ans we r :TRUE Di ff: 2 Obj e c t i ve :1 AACSB:Anal yt i c alt hi nki ng

1 6)I fU. Sdol l ars t r e ngt he nsa gai ns tt heJ a pane s eYe n,J apa ne s epr oduc e r ss e l l i nggoodsi nU. Smar ke t s wi l lha vet oi nc r e a s et hepr i c e sofpr oduc t st or e c o ve rt hee xt r ac os tar i s i ngf r om c ur r e nc yfluc t ua t i on. Ans we r :F ALSE Expl ana t i on:I fU. Sdol l ars t r e ngt he nsa gai ns tJ apane s eYe n,J a pane s epr oduc e r swi l lbea bl et os e l lt he i r goodsa tac he ape rr a t ei nt heU. Smar ke t sast he ywi l lnow r e c e i vemor eYe nf ort hes amedol l a ramount ofs al eandhe nc ewi l lbet e mpt e dt or e duc epr i c e s . Di ff: 3 Obj e c t i ve :1 AACSB:Anal yt i c alt hi nki ng

1 7)Cl audi aGe e r ,c ont r ol l e r ,di s c us s e st hepr i c i ngofane w pr oduc twi t ht hes a l e sma na ge r ,J ame sNol a n. Wha tma j ori nflue nc e smus tCl a udi aandJ ame sc ons i de ri npr i c i ngt hene w pr oduc t ?Di s c us se ac hbr i e fly . Ans we r :Thema j ori nflue nc e sar ec us t ome r s ,c ompe t i t or s ,a ndc os t s . Cus t o me r s :Ma na ge r smus tal wa yse xami nepr i c i ngpr obl e mst hr ought hee ye soft he i rc us t ome r s .A pr i c e i nc r e as ema yc aus ec us t ome r st or e j e c tac ompany' spr oduc tandc hoos eac ompe t i ngors ubs t i t ut e pr oduc t . Co mpe t i t o r s :Compe t i t or s ' r e a c t i onsi nflue nc epr i c i ngde c i s i ons .Atonee xt r e me ,ar i val ' spr i c e sand pr oduc t sma yf or c eabus i ne s st ol owe ri t spr i c e st obec ompe t i t i ve .Att heot he re xt r e me ,abus i ne s s wi t houtar i vali nagi ve ns i t ua t i onc ans e thi ghe rpr i c e s .A bus i ne s swi t hknowl e dgeofi t sr i val s ' t e c hnol ogy , pl a ntc a pac i t y ,andope r a t i ngpol i c i e si sabl et oe s t i ma t ei t sr i va l s ' c os t s ,whi c hi sval uabl e i nf or ma t i oni ns e t t i ngc ompe t i t i vepr i c e s . Co s t s :Compa ni e spr i c epr oduc t st oe x c e e dt hec os t sofmaki ngt he m. Thes t udyofc os t be ha vi orpa t t e r ns gi ve si ns i ghti nt ot hei nc omet ha tr e s ul t sf r om di ffe r e ntc ombi na t i onsofpr i c eandout putquant i t i e ss ol d f orapa r t i c ul a rpr oduc t . Di ff: 2 Obj e c t i ve :1 AACSB:Anal yt i c alt hi nki ng

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1 3 . 2 Obj e c t i ve13 . 2 1 )Whi c hoft hef ol l owi nge xampl e swoul dha veasi t spur pos et heal l oc a t i onofc os t st omot i va t e e mpl oye e s ? A)de c i di ngonas e l l i nggpr i c ef orapr oduc t B)e nc our a gi ngs al e sr e pr e s e nt a t i ve st oe mphas i zehi ghmar gi npr oduc t s C)t oc os tpr oduc t saa" f ai r "pr i c eunde ragove r nme ntc ont r a c t D)t oc os ti nve nt or i e sf orr e por t i ngt oe xt e r nalpar t i e s Ans we r :B Di ff: 2 Obj e c t i ve :2 AACSB:Anal yt i c alt hi nki ng

2 )Whi c hoft hef ol l owi ngar et r uer e ga r di ngl ongr unpr i c i ngde c i s i ons ? A)t he yr e s ul ti nmaxi mi z i ngr e t ur noni nve s t me nt B)t he yi nc l udea dj us t i ngpr oduc tmi xi nac ompe t i t i vee nvi r onme nt C)t hepr i c ene e dst obes uffic i e nte nought obr e ak e ve n D)us epr i c e st ha ti nc l udear e a s onabl er e t ur noni nve s t e dc a pi t a l Ans we r :D Di ff: 2 Obj e c t i ve :2 AACSB:Anal yt i c alt hi nki ng

3 )Whi c hoft hef ol l owi ngi st r ueofl ongr unpr i c i ng? A)I ti sfixe da tal e ve lt ha tr e c ove r st hevar i a bl ec os toft hec ompanya ndapr e de t e r mi ne dpr ofitmar kup. B)I ti sge ne r al l yaf unc t i onoft hemar ke tf a c t or sandt hec os ti nvol ve di npr oduc t i oni sge ne r al l ynota c ons i de r a t i on. C)I ti sas t r a t e gi cde c i s i onde s i gne dt obui l dl ongr unr e l a t i ons hi pswi t hc us t ome r sbas e dons t abl eand pr e di c t abl epr i c e s . D)I ti sbas e donl yoni nt e r na lr e qui r e me nt sl i kec os ta nde s t i ma t e dr a t eofr e t ur nasi nt hel ongr unt he s e r e qui r e me nt sar et hedr i vi ngf ac t or sofanyor gani za t i on. Ans we r :C Di ff: 3 Obj e c t i ve :2 AACSB:Anal yt i c alt hi nki ng

4 )Forl ongr unpr i c i ngde c i s i ons ,us i ngs t a bl epr i c e shast headvant a geof_ _____ __. A)mi ni mi zi ngt hene e dt omoni t orc ompe t i t or ' spr i c e sf r e que nt l y B)r e duc i ngt hene e dt oc hangec os ts t r uc t ur e sf r e que nt l y C)r e duc i ngc ompe t i t i on D)he l pi ngt obui l dbuye r s e l l e rr e l a t i ons hi ps Ans we r :D Di ff: 1 Obj e c t i ve :2 AACSB:Anal yt i c alt hi nki ng

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5 )J ac k' sBa c kPor c hmanuf ac t ur e sr us t i cf ur ni t ur e .Thec os ta c c ount i ngs ys t e me s t i ma t e smanuf ac t ur i ng c os t st obe$27 0pe rt abl e , c ons i s t i ngof8 0% var i abl ec os t sand20 % fixe dc os t s .Thec ompa nyha ss ur pl us c a pac i t ya vai l a bl e .I ti sJ a c k' sBac kPor c h' spol i c yt oadda60% mar kupt of ul lc os t s . Al a r gehot e lc ha i ni sc ur r e nt l ye xpa ndi ngandhasde c i de dt ode c or a t eal lne w hot e l sus i ngt her us t i c s t yl e .J a c k' sBac kPor c hi si nvi t e dt os ubmi tabi dt ot hehot e lc ha i n.Wha tpe runi tpr i c ewi l lJ ac k' sBa c k Por c hmos tl i ke l ybi dont hi sl ongt e r m or de r ? A)$86. 4 0pe runi t B)$ 162. 0 0pe runi t C)$345 . 60pe runi t D)$ 432. 0 0pe runi t Ans we r :D Expl ana t i on:Mos tl i ke l ype runi tbi d=$ 270+( $27 0×6 0%)=$ 432. 00 . Di ff: 2 Obj e c t i ve :2 AACSB:Appl i c a t i onofknowl e dge

6 )Zol as ' He a t e r si sa ppr oac he dbyMs .Le i l a ,ane wc us t ome r , t of ul fil lal ar geone t i me onl ys pe c i a lor de r f orapr oduc ts i mi l a rt ooneoffe r e dt or e gul a rc us t ome r s .Zol as ' He a t e r shase x c e s sc apac i t y . Thef ol l owi ng pe runi tda t aappl yf ors a l e st or e gul arc us t ome r s : Di r e c tma t e r i al s Di r e c tmanuf a c t ur i ngl a bor Va r i a bl emanuf a c t ur i ngs uppor t Fi x e dmanuf ac t ur i ngs uppor t Tot alma nuf a c t ur i ngc os t s Mar kup( 30% oft ot a lma nuf a c t ur i ngc os t s ) Es t i ma t e ds e l l i ngpr i c e

$ 420 1 00 7 0 2 00 7 90 2 37 $ 1027

I fMs .Le i l awant e dal ongt e r mc ommi t me nt , andnotaone t i me s pe c i alor de r ,f ors uppl yi ngt hi spr oduc t , c a l c ul a t et hemos tl i ke l ypr i c et obequot e da s s umi ngt hemar kupr e mai nst hes a me ? A)$790 B)$ 590 C)$520 D)$ 1027 Ans we r :D Expl ana t i on:Mos tl i ke l yl ongt e r m pr i c e=$1 027. Di ff: 2 Obj e c t i ve :2 AACSB:Appl i c a t i onofknowl e dge

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7 )Gol de nGe ne r a t orSuppl yi sa ppr oac he dbyMr .St e phe n, ane wc us t ome r ,t of ul fil lal ar geone t i me onl ys pe c i alor de rf orapr oduc ts i mi l art ooneoffe r e dt or e gul arc us t ome r s . Gol de nGe ne r a t orSuppl yha s e x c e s sc a pac i t y . Thef ol l owi ngpe runi tda t aa ppl yf ors al e st or e gul arc us t ome r s : Di r e c tma t e r i al s Di r e c tmanuf a c t ur i ngl a bor Va r i a bl emanuf a c t ur i ngs uppor t Fi x e dmanuf ac t ur i ngs uppor t Tot alma nuf a c t ur i ngc os t s Mar kup( 10% oft ot a lma nuf a c t ur i ngc os t s ) Es t i ma t e ds e l l i ngpr i c e

$ 190 1 80 2 80 1 40 7 90 7 9 $ 869

I fMr .St e phe nwant e dal ongt e r mc ommi t me nt ,a ndnotaone t i me onl ys pe c i alor de r ,f ors uppl yi ngt hi s pr oduc t ,c al c ul a t et hemos tl i ke l ypr i c et obequot e das s umi ngt hemar kupr e ma i nst hes a me ? A)$650 B)$ 790 C)$869 D)$ 370 Ans we r :C Expl ana t i on:Longr unpr i c i ngi sas t r a t e gi cde c i s i onde s i gne dt obui l dl ongr unr e l a t i ons hi pswi t h c us t ome r sbas e dons t abl eandpr e di c t abl epr i c e s .The r e f or e ,t hemos tl i ke l yl ongt e r m pr i c e=$8 69. Di ff: 2 Obj e c t i ve :2 AACSB:Appl i c a t i onofknowl e dge

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8 )Gr ac i usManuf ac t ur i ngi sappr oa c he dbyaEur ope anc us t ome rt of ul fil laone t i me onl ys pe c i alor de r f orapr oduc ts i mi l a rt ooneoffe r e dt odome s t i cc us t ome r s .Gr ac i usManuf ac t ur i ngha sapol i c yofa ddi ng a20% mar kupt of ul lc os t sandc ur r e nt l yhase x c e s sc a pac i t y .Thef ol l o wi ngpe runi tda t aappl yf ors a l e st o r e gul arc us t ome r s : Va r i a b l ec o s t s : Di r e c tma t e r i al s Di r e c tl abor Manuf a c t ur i ngove r he ad Mar ke t i ngc os t s Fi xe dc o s t s : Manuf a c t ur i ngove r he ad Mar ke t i ngc os t s Tot alc os t s Mar kup( 20% oft ot a lc os t s ) Es t i ma t e ds e l l i ngpr i c e

$ 50 3 0 1 0 2 0 1 10 3 0 2 50 5 0 $ 30 0

I ft heEur ope anc us t ome rwa nt e dal ongt e r mc ommi t me nt ,a ndnotaone t i me onl ys pe c i alor de r ,f or s uppl yi ngt hi spr oduc t ,c al c ul a t et hemos tl i ke l ypr i c et obequot e da s s umi ngt hema r kupr e ma i nst he s ame ? A)$110 B)$ 250 C)$300 D)$ 190 Ans we r :C Expl ana t i on:Longr unpr i c i ngi sas t r a t e gi cde c i s i onde s i gne dt obui l dl ongr unr e l a t i ons hi pswi t h c us t ome r sbas e dons t abl eandpr e di c t abl epr i c e s .The r e f or e ,t hemos tl i ke l yl ongt e r m pr i c e=$3 00. Di ff: 2 Obj e c t i ve :2 AACSB:Appl i c a t i onofknowl e dge

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9 )Gr ounde dCoffe ePr oduc t smanuf ac t ur e sc offe et abl e s .Gr ounde dCoffe ePr oduc t shasapol i c yof a ddi nga20% mar kupt of ul lc os t sa ndc ur r e nt l yhase x c e s sc apac i t y .Thef ol l owi ngi nf or ma t i onpe r t ai ns t ot hec ompa ny' snor ma lope r a t i onspe rmont h: Out putuni t s Mac hi ne hour s Di r e c tmanuf a c t ur i ngl a bor hour s Di r e c tma t e r i al spe runi t Di r e c tmanuf a c t ur i ngl a borpe rhour Va r i a bl emanuf a c t ur i ngove r he adc os t s Fi x e dmanuf ac t ur i ngove r he adc os t s Pr oduc tandpr oc e s sde s i gnc os t s Mar ke t i nga nddi s t r i but i onc os t s

3 0, 000 t abl e s 6 000 hour s 10, 00 0 hour s $ 50 $ 12. 00 $ 322, 50 0 $1, 20 0, 000 $ 600, 00 0 $ 1, 290, 0 00

Forl ongr unpr i c i ngoft hec offe et abl e s , wha tpr i c ewi l lmos tl i ke l ybeus e dbyGr ounde dCoffe e ? A)$64. 7 5 B)$ 103. 0 0 C)$167 . 75 D)$ 201. 3 0 Ans we r :D Expl ana t i on: Di r e c tma t e r i al s$50 $ 50 Di r e c tmanuf a c t ur i ngl a bor( $12. 0 0×10, 00 0/30, 00 0) 4 Va r i a bl emanuf a c t ur i ng( $322, 5 00/3 0, 000 ) 1 0. 75 Fi x e dmanuf ac t ur i ng( $1, 200 , 000/30, 00 0) 40 Pr oduc tandpr oc e s sde s i gnc os t s( $600 , 000 /3 0, 000) 2 0 Mar ke t i nga nddi s t r i but i on( $1, 290 , 000/30, 0 00) 4 3. 00 Ful lc os tpe runi t 1 67. 75 Mar kup( 20%) 3 3. 55 Es t i ma t e ds e l l i ngpr i c e $ 201. 30 Di ff: 3 Obj e c t i ve :2 AACSB:Appl i c a t i onofknowl e dge

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1 0)Qui c kConne c tmanuf ac t ur e shi ght e c hc e l lphone s . Qui c kConne c thasapol i c yofa ddi nga20% mar kupt of ul lc os t sandc ur r e nt l yhase x c e s sc apac i t y .Thef ol l owi ngi nf or ma t i onpe r t ai nst ot he c ompa ny' snor ma lope r a t i onspe rmont h: Out putuni t s 1 600 phone s Mac hi ne hour s 650 hour s Di r e c tmanuf a c t ur i ngl a bor hour s 1 000 hour s Di r e c tma t e r i al spe runi t Di r e c tmanuf a c t ur i ngl a borpe rhour Va r i a bl emanuf a c t ur i ngove r he adc os t s Fi x e dmanuf ac t ur i ngove r he adc os t s Pr oduc tandpr oc e s sde s i gnc os t s Mar ke t i nga nddi s t r i but i onc os t s

$ 20 $ 6. 40 $ 14, 000 $ 48, 000 $ 32, 000 $ 6 5, 600

Forl ongr unpr i c i ngoft hec e l lphone s ,wha tpr i c ewi l lmos tl i ke l ybeus e dbyQui c kConne c t ? A)$32. 7 5 B)$ 91. 00 C)$123 . 75 D)$ 148. 5 0 Ans we r :D Expl ana t i on: Di r e c tma t e r i al s$20 $ 20 Di r e c tmanuf a c t ur i ngl a bor( $6. 4 0×1000 /1 600) 4 Va r i a bl emanuf a c t ur i ng( $14, 00 0/1 600) 8 . 75 Fi x e dmanuf ac t ur i ng( $48, 00 0/1 600) 3 0 Pr oduc tandpr oc e s sde s i gnc os t s( $32, 0 00/160 0) 2 0 Mar ke t i nga nddi s t r i but i on( $65, 60 0/1 600) 4 1 . 00 Ful lc os tpe runi t 1 23. 75 Mar kup( 20%) 2 4. 75 Es t i ma t e ds e l l i ngpr i c e $ 148. 50 Di ff: 3 Obj e c t i ve :2 AACSB:Appl i c a t i onofknowl e dge

1 1)Whi c honeoft hef ol l owi nga c t i vi t i e swoul dmos tl i ke l ybec ons i de r e dal ongr unpr i c i ngde c i s i on? A)one t i me onl ys pe c i alor de rpr i c i ngt ha twoul dr e s ul ti na c hi e vi ngt hebr e ak e ve npoi nt B)pr oduc tmi xa dj us t me nt si nac ompe t i t i vema r ke t C)s e t t i ngpr i c e st oge ne r a t ear e as onabl er a t eofr e t ur noni nve s t me nt D)c hangi ngpr i c e si nr e s pons et owe a kde mand Ans we r :C Di ff: 2 Obj e c t i ve :2 AACSB:Anal yt i c alt hi nki ng

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1 2)Whi c hoft hef ol l owi ngs t a t e me nt saboutpr i c i ngi st r ue ? A)pr i c i ngf orpr oduc t ss ol d...