Appendix 8A
The Concept of Present Value
True / False Questions
1. The present value of a given amount decreases as the number of years over which it is to be
discounted also decreases.
True
False
2. An increase in the discount rate will
83.
If the total budgeted selling and administrative expense for October is $409,000, then how
many Yutes does the company plan to sell in October?
A. 19,700 units
B. 20,000 units
C. 20,500 units
D. 20,200 units
Total s
11
12
13
M/C
M/C
M/C
M
M
M
x
x
x
14
15
16
M/C
M/C
M/C
M
M
E
x
x
x
5
6
M
M
M
E
x
x
x
x
M
x
E
x
M
E
M
H
x
x
x
x
Professional Exam Adapted
7
8
9
10
Question
Type
T/F
T/F
T/F
T/F
Conceptual
M/C
Conceptual
M/C
Conceptual
M/C
M/C
M/C
M/C
1
2
3
4
LO8: (Append
276. During August, Cardenas Clinic budgeted for 3,900 patient-visits, but its actual level of activity
was 3,800 patient-visits. The clinic uses the following revenue and cost formulas in its
budgeting, where q is the number of patient-visits:
Rev
83.
If the total budgeted selling and administrative expense for October is $409,000, then how
many Yutes does the company plan to sell in October?
A. 19,700 units
B. 20,000 units
C. 20,500 units
D. 20,200 units
Total s
Appendix 8C
Income Taxes in Capital Budgeting Decisions
True / False Questions
1. The reduction in taxes made possible by the annual depreciation deductions equals the
depreciation deduction multiplied by the tax rate.
True
False
2. The
119. (Ignore income taxes in this problem.) Tranter, Inc., is considering a project that would have a
ten-year life and would require a $1,200,000 investment in equipment. At the end of ten years,
the project would terminate and the equipment would ha
171. The following labor standards have been established for a particular product:
The following data pertain to operations concerning the product for the last month:
Required:
a. What is the labor rate variance for the month?
b. What is the labor
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
T/F
T/F
T/F
T/F
T/F
T/F
Conceptual
M/C
Conceptual
M/C
Conceptual
M/C
Conceptual
E
H
M
M
E
x
x
x
x
ID
x
x
x
x
x
x
x
x
x
8/e:ATB12-23
11/26/97,E
11/26/97,L
11/26/97,M
1/e: 11-6
3/e: 11-2
Origin
Authors
Authors
Authors
Professional Exam Adapted
LO10:Budgeted balance sheet
LO9: Budgeted income statement
LO8: Cash budget
LO7: Selling & administrative budget
LO5: Direct labor budget
T/F
M
x
2
T/F
E
x
6/e: 8-7
3
T/F
E
x
7/e: 9-1
4
T/F
M
x
7/e: 9-3
5
T/F
E
x
7/e: 9-4
6
7
1
2
3
4
5
6
Question
Type
T/F
T/F
Conceptual
M/C
Conceptual
M/C
M/C
M/C
Professional Exam Adapted
LO7: (Appendix 8A) Present value concepts
Difficulty
M
M
x
x
2/e: 13-9
4/e: 14-846
Origin
Authors
Authors
M
x
4/e: 14-878
Authors
M
x
6/e: 14-35
10/13/
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
Professional Exam Adapted
LO7: Sell or process further
LO6: Value of relaxing constraint
LO5: Utilization of constrained resource
LO4: Special orders
LO3: Make or buy
LO2: Adding or dropping a segment
Que