SE_Ch13 - CHAPTER 13: MULTIPLE CHOICE SAMPLE EXAM QUESTIONS...

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CHAPTER 13: MULTIPLE CHOICE SAMPLE EXAM QUESTIONS *** SEE SOLUTION IS AT THE END OF THE FILE*** 1. Diaz Company’s contribution margin is $4 per unit for Product A and $5 for Product B. Product A requires 2 machine hours and Product B requires 4 machine hours. How much is the contribution margin per unit of limited resource for each product? A B a. $4.00 $5.00 b. $2.00 $1.25 c. $1.25 $2.00 d. $2.50 $1.00 2. Techno Company is designing a portable DVD player aimed at families traveling with young children. The company believes that the product can be sold for $140 and it requires that profit be 20% of the selling price on new products. What is the target cost of the portable DVD player? a. $140 b. $28 c. $175 d. $112 e. $168 3. The Tassel Corporation, a manufacturer of men’s shoes, sells 100,000 pairs of shoes in the United States each year for $30 per pair. Tassel Corporation has the capacity to produce 120,000 pairs of shoes annually. During the current year, variable production and distribution costs are expected to be $16 per pair, while expected fixed production and distribution costs will amount to $500,000 (or $5 per pair for 100,000 pairs). Tassel received an order from a foreign retailer to purchase 10,000 pairs of shoes. Domestic sales would not be affected by this transaction. If the offer is accepted, variable
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SE_Ch13 - CHAPTER 13: MULTIPLE CHOICE SAMPLE EXAM QUESTIONS...

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