Bevo Beef Company uses the relative market value method of allocating joint costs in their production of beef products. Relevant information for the current period follows:
The total joint cost for the current period was $43,000. How much of this cost should Bevo Beef allocate to sirloin?
| [removed] | $0 |
| [removed] | $5,909 |
| [removed] | $8,600 |
| [removed] | $10,750 |
| [removed] | $43,000 |
A department that incurs costs without directly generating revenues is a:
| [removed] | Service center. |
| [removed] | Production center. |
| [removed] | Profit center. |
| [removed] | Cost center. |
| [removed] | Performance center. |
Fred Smith and Joe Barney are managers of two product lines for Quarry Company. One of them is a candidate for promotion based on performance. Using the data above, which of the following is a true statement?
| [removed] | Smith is outperforming Barney as measured by return on investment center assets. |
| [removed] | Barney is outperforming Smith as measured by return on investment center assets. |
| [removed] | The return in investment center assets is the same for both. |
| [removed] | If target performance is a 7% return on assets, both investment centers are performing above the target level. |
| [removed] | If target performance is a 7% return on assets, the residual income for both centers is positive. |
Joint products A and B are produced in a single operation from Material M. Three hundred gallons of Material M, costing $450, produced 200 gallons of Product A, selling for $2 per gallon, and 100 gallons of Product B, selling for $6 per gallon.
If the $450 cost of the 300 gallons of Material M were to be allocated to the joint products in proportion to the number of gallons of each product produced, Product A’s share would be:
| [removed] | $0 |
| [removed] | $180 |
| [removed] | $225 |
| [removed] | $300 |
| [removed] | $450 |
An accounting system that provides information that management can use to evaluate the performance of a department’s manager is called a:
| [removed] | Cost accounting system. |
| [removed] | Managerial accounting system. |
| [removed] | Responsibility accounting system. |
| [removed] | Financial accounting system. |
| [removed] | Activity-based accounting system. |
A company has two departments, Aa and Bb, that incur delivery expenses. An analysis of the total delivery expense of $9,000 indicates that Dept. Aa had a direct expense of $1,000 for deliveries. None of the $9,000 is a direct expense to Dept. Bb. The analysis also indicates that 60% of regular delivery requests originate in Dept. Aa and 40% in Dept. Bb. The delivery expenses that should be charged to Dept. Aa and Dept. Bb, respectively, are:
| [removed] | Option A |
| [removed] | Option B |
| [removed] | Option C |
| [removed] | Option D |
| [removed] | Option E |
Which of the following is most likely to be considered a profit center?
| [removed] | An individual retail store in a large chain. |
| [removed] | The grocery department of a Walmart Supercenter or Target Superstore. |
| [removed] | The maintenance department of a large retail operation. |
| [removed] | The personnel office of a business. |
| [removed] | A stand-alone eye clinic. |
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