Texas A&M University, Corpus Christi ACCOUNTING 3230, Winter The basic break-even model can be modified …

| November 28, 2016

Question
Question 1

1.

The basic break-even model can be modified to handle more than one product. This extension of the basic model requires

Answer

A. three-dimensional graphing software

B. sales volume for each product

C. price and sales volume for each product

D. at least a Pentium computer

E. price and cost for each product, as well as the percent of total sales that each product represents

Question 2

1.

Mass customization, when done correctly,

A. involves all items in this list

B. increases pressure on scheduling

C. increases pressure on supply chain performance

D. helps eliminate the guesswork that comes with sales forecasting

E. drives down inventories

Question 3

Breakeven is the number of units at which

A. total revenue equals total variable cost

B. total revenue equals total fixed cost

C. total profit equals total cost

D. total revenue equals price times quantity

E. total revenue equals total cost

Question 4

1.

A fabrication company wants to increase capacity by adding a new machine. The firm is considering proposals from vendor A and vendor B. The fixed costs for machine A are $90,000 and for machine B, $75,000. The variable cost for A is $15.00 per unit and for B, $18.00. The revenue generated by the units processed on these machines is $21 per unit. If the estimated output is 5000 units, which machine should be purchased?

A. either machine A or machine B

B. purchase both machines since they are both profitable

C. machine B

D. no purchase because neither machine yields a profit at that volume

E. machine A

Question 5

1.

Which one of the following products is most likely made in a job shop environment?

A. television sets

B. cigarettes

C. McDonald’s hamburgers

D. graphite pencils

E. custom furniture

Question 6

1.

A drawing of the movement of material, or people is a

A. flow diagram

B. service blueprint

C. tool not in this list.

D. process map

E. process chart

Question 7

1.

The use of information technology to monitor and control a physical process is known as

A. unknown; the answer is not in this list.

B. computer-aided design

C. numeric control

D. information numeric control

E. process control

Question 8

1.

One dollar saved in purchasing is

A. worth slightly more than a dollar earned because of taxes

B. only worthwhile if you are in the 50% tax bracket and still have a low profit margin

C. worth even more than a dollar earned in sales revenue

D. worth from 35% in the technical instrument industry to 70% in the food products industry

E. equivalent to a dollar earned in sales revenue

Question 9

1.

Which of the following supply-chain strategies creates value by allowing suppliers to have economies of scale?

A. suppliers becoming part of a company coalition

B. negotiating with many suppliers

C. vertical integration

D. long-term partnering with a few suppliers

E. developing virtual companies

Question 10

1.

A fried chicken fast-food chain that acquired feed mills and poultry farms has performed

A. backward vertical integration

B. current transformation

C. forward vertical integration

D. horizontal integration

E. job expansion

Question 11

1.

The “bullwhip” effect

A. occurs as orders are relayed from retailers to wholesales

B. increases the costs associated with inventory in the supply-chain

C. results in increasing fluctuations at each step of the sequence

D. occurs because of distortions in information in the supply-chain

E. is correctly described by every item in this list

Question 12

1.

Which one of the following distribution systems offers quickness and reliability when emergency supplies are needed overseas?

A. air freight

B. railroads

C. trucking

D. waterways

E. pipelines

Question 13

1.

A student sells his used textbook to another student on eBay. This is an example of

A. C2B

B. B2B

C. C2C

D. None in this list.

E. B2C

Question 14

McDonald’s was able to utilize existing plants and transportation systems in preparing the supply chain for opening its stores in Moscow

Question 15

Blanket orders are a long-term purchase commitment to a supplier for items that are to be delivered against short-term releases to ship.

Question 16

With few suppliers, the cost of changing partners is low.

Question 17

It cost Mary $20 to rent a space at the Flea Market every Saturday to sell candied apples. She sells candied apples for $2 each and each candied apple cost her $0.75 from the wholesale warehouse. Determine the number of candied apples that Mary must sell to break even.

Question 18

John needs additional manufacturing space. He found a multi-use facility in a mixed-use zone. The landlord is John’s friend and offered him a “sweet-deal” 10-year lease at $120,000 per year with no deposit and no payment until the end of year one. John pays him at the end of every year from thereon until the expiration. John needs to determine the present value of this lease proposal to evaluate the cost of competing options. What is the present value of this lease if the annual interest is 10%? (Enter the value below to the nearest dollar without commas and without “$”. For example, $2,500,000.65 is entered as 2500001 below.)

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