Quiz18 - Quiz Chapter 18 1 Opportunity costs are A not used for decision making B the same as variable costs C the same as historical costs D

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Page 1 Quiz – Chapter 18 1. Opportunity costs are: A) not used for decision making. B) the same as variable costs. C) the same as historical costs. D) relevant to decision making. 2. Freestone Company is considering renting Machine Y to replace Machine X. It is expected that Y will waste less direct materials than does X. If Y is rented, X will be sold on the open market. For this decision, which of the following factors is (are) relevant? I. Cost of direct materials used II. Resale value of Machine X A) Only I B) Only II C) Both I and II D) Neither I nor II 3. In a sell or process further decision, which of the following costs are relevant? I. A variable production cost incurred prior to the split-off point. II. An avoidable fixed production cost incurred after the split-off point. A) Only I. B) Only II. C) Both I and II. D) Neither I nor II. Use the following to answer questions 4-6: The Tingey Company has 500 obsolete microcomputers that are carried in inventory at a total cost of $720,000. If these microcomputers are upgraded at a total cost of $100,000, they can be sold for a total of $160,000. As an alternative, the microcomputers can be sold in their present condition for $50,000.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 06/07/2011 for the course 2 1 taught by Professor Dw during the Spring '11 term at Umbau School of Architecture.

Page1 / 4

Quiz18 - Quiz Chapter 18 1 Opportunity costs are A not used for decision making B the same as variable costs C the same as historical costs D

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online