ACG 2071 Final Exam Questions With
Correct Answers
Differential Cost - CORRECT ANSWER✔✔-A difference in cost between
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any two alternatives
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Differential Revenue - CORRECT ANSWER✔✔-A difference in revenue
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between any two alternatives
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Avoidable Cost - CORRECT ANSWER✔✔-A cost that can be eliminated by
| | | | | | | | | |
choosing one alternative over another
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Sunk Cost - CORRECT ANSWER✔✔-A cost that has already been
| | | | | | | | | |
incurred and cannot be avoided regardless of what a manager decides
| | | | | | | | | | |
to do
|
Drop Product Line - CORRECT ANSWER✔✔-Locating expenses and/or
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revenues that will be eliminated if a single product is dropped from
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production
, Make or Buy Decisions - CORRECT ANSWER✔✔-Determining whether
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it's smarter to Make or Buy a product based on expenses and buying
| | | | | | | | | | | | |
prices
Special Order - CORRECT ANSWER✔✔-A one time order that is not
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considered part of the company's normal ongoing business
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Contained Resource - CORRECT ANSWER✔✔-Determine what product
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has the highest CM per unit (CM/min to produce OR CM/lb per unit)
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Sell or Proccess Further - CORRECT ANSWER✔✔-Determine if its more
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profitable to sell a product or continue to produce further (Rev-
| | | | | | | | | |
Cost=Profit)
Calculate Working Capital - CORRECT ANSWER✔✔-Current Assets -
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Current Liabilities |
Cost of Capital - CORRECT ANSWER✔✔-The average rate of return that
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the company must pay to its long term creditors and its shareholders for
| | | | | | | | | | | |
the use of their funds
| | | | |
Calculate Current Ratio - CORRECT ANSWER✔✔-Current Assets/ Current
| | | | | | |
Liabilities
|
Correct Answers
Differential Cost - CORRECT ANSWER✔✔-A difference in cost between
| | | | | | | | |
any two alternatives
| |
Differential Revenue - CORRECT ANSWER✔✔-A difference in revenue
| | | | | | | |
between any two alternatives
| | |
Avoidable Cost - CORRECT ANSWER✔✔-A cost that can be eliminated by
| | | | | | | | | |
choosing one alternative over another
| | | | |
Sunk Cost - CORRECT ANSWER✔✔-A cost that has already been
| | | | | | | | | |
incurred and cannot be avoided regardless of what a manager decides
| | | | | | | | | | |
to do
|
Drop Product Line - CORRECT ANSWER✔✔-Locating expenses and/or
| | | | | | | |
revenues that will be eliminated if a single product is dropped from
| | | | | | | | | | | |
production
, Make or Buy Decisions - CORRECT ANSWER✔✔-Determining whether
| | | | | | | |
it's smarter to Make or Buy a product based on expenses and buying
| | | | | | | | | | | | |
prices
Special Order - CORRECT ANSWER✔✔-A one time order that is not
| | | | | | | | | | |
considered part of the company's normal ongoing business
| | | | | | |
Contained Resource - CORRECT ANSWER✔✔-Determine what product
| | | | | | |
has the highest CM per unit (CM/min to produce OR CM/lb per unit)
| | | | | | | | | | | |
Sell or Proccess Further - CORRECT ANSWER✔✔-Determine if its more
| | | | | | | | | |
profitable to sell a product or continue to produce further (Rev-
| | | | | | | | | |
Cost=Profit)
Calculate Working Capital - CORRECT ANSWER✔✔-Current Assets -
| | | | | | | |
Current Liabilities |
Cost of Capital - CORRECT ANSWER✔✔-The average rate of return that
| | | | | | | | | | |
the company must pay to its long term creditors and its shareholders for
| | | | | | | | | | | |
the use of their funds
| | | | |
Calculate Current Ratio - CORRECT ANSWER✔✔-Current Assets/ Current
| | | | | | |
Liabilities
|
