16) The accountant’s primary role in the decision-making process is to

A) make the decision.

B) collect relevant information.

C) report irrelevant information.

D) provide emotional support.

17) In decision making, the key question is:

A) What are the fixed costs of each alternative?

B) What are the past costs of each alternative?

C) What difference will the choice make?

D) What are the irrelevant costs?

18) The predicted future costs and revenues that will differ among alternative courses of action are referred to as

A) relevant information.

B) sunk costs and revenues.

C) historical information.

D) predictable information.

19) ________ is (are) defined as any method for making a choice.

A) A decision model

B) Irrelevant costs

C) Relevant costs

D) Prediction method

20) ________ becomes a principal source of feedback.

A) Prediction method

B) Decision model

C) Implementation

D) Evaluation of performance

21) ________ uses information as a basis for estimating future costs.

A) Prediction method

B) Decision model

C) Implementation

D) Evaluation of performance

22) ________ is the process of putting a decision into action.

A) Prediction method

B) Decision model

C) Implementation

D) Evaluation of performance

23) Each week Kline Company produces 800 units of a product that has variable costs of $8 per unit.  Total fixed costs for the month are $6,800.  A special order is received for 200 units of the same product at a price of $9 per unit.  In deciding to accept or reject this special order, it is appropriate to consider the

A) difference between the offered price and the variable cost per unit, or $1.00.

B) old fixed cost per unit of $8.50.

C) new fixed cost per unit of $6.80.

D) difference between the two fixed costs per unit, which is $1.70.

24) Each month Barrett Company produces 4,000 units of a product that has variable costs of $10 per unit.  Total fixed costs for the month are $14,800.  A special order is received which is for 625 units at a price of $12 per unit.  Relevant to the decision of whether to accept or reject this special order is the

A) old fixed cost per unit of $3.70.

B) new fixed cost per unit of $3.20.

C) difference between the offered price and the variable cost per unit, which is $2.00.

D) difference between the two fixed costs per unit, which is $0.50.

25) Each quarter Comito, Inc. produces 120,000 units of a product that has variable costs of $56 per unit.  Total fixed costs for the quarter are $90,000.  A special order is received which is for 30,000 units at a price of $57 per unit.  In deciding to accept or reject this special order, it is appropriate to consider the

A) old fixed cost per unit of $0.75.

B) difference between the offered price and the variable cost per unit, which is $1.00.

C) new fixed cost per unit of $0.60.

D) difference between the two fixed costs per unit, which is $0.15.



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