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Multiple choice

A variance report for the month shows that there is an unfavorable direct labor wage variance of $1,100. When this variance is analyzed, it is determined that the wage rate variance was $2,475 unfavorable. Therefore, labor efficiency must have a variance of:
Answer Choices
a. $3,575 unfavorable
b. $1,100 favorable
c. $1,375 favorable
d. Cannot be determined from the information provided

An example of a Discretionary Fixed cost would be which of the following?
Answer Choices
a. Manufacturing facility rent payments
b. Salary of the organization's president
c. New computers budgeted for the human resource office
d. Equipment depreciation

You calculate both the net present value and payback for investment alternatives A and B. Alternative A has a payback of 2.5 years and a NPV of $10,000. Alternative B has a payback of 1.5 years and a NPV of $5,000. Both alternatives have five year expected lives. Considering the decision making value of each method, from a financial perspective the most attractive alternative is:
Answer Choices
a. Alternative A
b. Alternative B
c. Both Alternative A and B
d. Cannot be determined from the information provided

Refer to attachment for this question
The segment with the most attractive segment margin based on return on sales is the:
Answer Choices
a. New car sales
b. Used car sales
c. Body shop
d. Service department
e. Lease sales


Solution Preview

1. a. $3,575 unfavorable
The total variance is $1,100U and this comprises of rate variance and efficiency variance. The rate variance is given as $2,475 F and so the efficiency variance would be 1,100+2,475=$3,575 U so that the ...

Solution Summary

The solution explains some multiple choice questions in managerial accounting