College Acct 2- Chapter 10

Front

This year's margin was closest to: 10.0%, 75.0%, 25.0%, 12.5%

Back

12.5%

Front

A segment of a business that is responsible for generating its own revenue and managing its own costs is referred to as:

Back

a profit center.

Front

Which performance metric incentivizes an investment center to grow as long as it earns a return greater than the minimum required return on its average operating assets?

Back

residual income

Front

All other things equal, which of the following would decrease a division's residual income? Options: Increase in net operating income., Decrease in expenses., Decrease in minimum required return., Increase in average operating assets.

Back

Increase in average operating assets.

Front

Which of the following will result in an increase in return on investment (ROI), assuming other factors remain the same? A decrease in sales. A decrease in operating assets. A decrease in net operating income. An increase in expenses.

Back

A decrease in operating assets.

Front

Which of the following will increase a company's manufacturing cycle efficiency (MCE)?
Options: both a decrease in inspection time and a decrease in queue time, a decrease in inspection time only, a decrease in queue time only, neither a decrease in inspection time or a decrease in queue time

Back

both a decrease in inspection time and a decrease in queue time

Front

A company has provided the following data for its most recent year of operations:

Return on investment 18%
Average operating assets $120,000
Minimum required rate of return 12%

The residual income for the year was closest to:

Back

$7,200

Front

What is the total throughput time for Schapp Corporation's order given the following times? Move time 3.6 hours, Wait time 11.5 hours, Queue time 5.7 hours, Process time 2.1 hours, Inspection time 0.5 hours.

Back

11.9 hours

Front

Which performance metric might lead a manager to reject a beneficial investment for the company? Options: contribution margin, residual income, segment margin, return on investment.

Back

return on investment.

Front

What is the manufacturing cycle efficiency (MCE) for Simkin Corporation given the following times (in hours): Wait time 18.4, Process time 1.4, Inspection time 0.1, Move time 2.9, Queue time 5.0?

Back

The formula for MCE is: MCE = Process Time / (Process Time + Wait Time + Inspection Time + Move Time + Queue Time). For Simkin Corporation, MCE = 1.4 / (1.4 + 18.4 + 0.1 + 2.9 + 5.0) = 0.15.