Choc. Creme
Cruller
Boston Creme
Jelly
NONE
1 POINT
1 POINT
1 POINT
1 POINT
1 POINT
2 POINTS 2 POINTS 2 POINTS 2 POINTS 2 POINTS
3 POINTS 3 POINTS 3 POINTS 3 POINTS 3 POINTS
4 POINTS 4 POINTS 4 POINTS 4 POINTS 4 POINTS
5 POINTS 5 POINTS 5 POINTS 5 POINTS 5 POINTS
1 POINT
This is the increase or decrease in revenue
when comparing two alternatives.
What is Differential Revenue?
2 POINTS
This is the increase or decrease in cost
when comparing two alternatives.
What is differential cost?
3 POINTS
This is a type of cost that occurred in
the past and shouldn’t be considered
when evaluating alternatives.
What is a sunk cost?
4 POINTS
If _______costs are more than
the revenue of a product, it
should be discontinued.
What is variable?
5 POINTS
The rate of earnings is 6% and the cash to be
received in three years is $10,000. Determine the
present value amount, using the following partial table
of present value of $1 at compound interest:
Year
1
2
3
4
6%
.943
.890
.840
.792
10%
.909
.826
.751
.683
12%
.893
.797
.712
.636
What is $8,400?
1 POINT
A dollar today is worth more than a dollar
tomorrow – this is the main idea behind the
_____ value of money.
What is time?
2 POINTS
Decisions to buy new equipment, expand a
building, etc are examples of _______
________ analysis.
What is capital investment?
3 POINTS
These are two capital analysis methods that
take into account present value.
What are the IRR and the net
present value methods?
4 POINTS
Estimated average annual income divided
by average investment
What is the average rate of
return method?
5 POINTS
The expected average rate of return for a
proposed investment of $400,000 in a fixed
asset, with a useful life of four years,
straight-line depreciation, no residual value,
and an expected total net income of
$120,000 for the 4 years, is:
What is 15%?
1 POINT
A series of equal payments at fixed interval
is called this.
What is an annuity?
2 POINTS
Transportation between departments is
considered _______-________ time.
What is nonvalue added time?
3 POINTS
In a JIT environment, _______ are
empowered to make decisions about
operations.
What are employees?
4 POINTS
In a JIT environment, inventory
purchases are recorded to this
account.
What is Raw and In Process Inventory?
5 POINTS
When ranking several alternative proposals
of different investment amounts it is useful to
compare them using their ________
_______ ________.
What is the present value
index?
1 POINT
A traditional manufacturing system
manufactures products, sends them to
stores and waits for a customer to buy them
– this is a _____ system.
What is a push system?
2 POINTS
In a JIT system, the end customer requests
the product directly from the manufacturer –
this is called a _____ system.
What is a pull system?
3 POINTS
This capital investment analysis method
determines (in years) how long it will take to
recoup the initial investment.
What is the cash payback
method?
4 POINTS
A main tenet of a JIT environment is reliance
on vendors and suppliers – this is what’s
called ______ ______ ______
What is supply chain
management?
5 POINTS
Labor costs and factory overhead are debited directly to this
account.
What is Raw and In Process
Inventory?
1 POINT
2 POINTS
3 POINTS
4 POINTS
5 POINTS
CATEGORY:
Make or buy?
MAKE YOUR WAGER!
ANSWER:
A business is operating at 90% of capacity and is
currently purchasing a part used in its
manufacturing operations for $18 per unit. The
unit cost for the business to make the part is $25,
including fixed costs, and $11, not including fixed
costs. If 20,000 units of the part are normally
purchased during the year but could be
manufactured using unused capacity, what would
be the amount of differential cost increase or
decrease from making the part rather than
purchasing it? (Include dollar amount and
“increase/decrease” with your answer).
QUESTION
What is $140,000 decrease in cost?