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NEW QUESTION: 1
When should the costs be recognized according to the IPM process?
A. When the subcontractor confirms the reception of the Purchase Order.
B. When Internal Acceptance is granted.
C. When the Purchase Order is created and sent to the subcontractor.
D. When the invoice from the subcontractor is received.
Answer: B
NEW QUESTION: 2
Danny holds 1%, Edward 2% and Fozia 3% of the issued share capital of Vee Ltd. Which of these shareholders, acting alone or together, hold the minimum percentage to entitle them to require the company to circulate a written statement of their views to all those entitled to receive notice of the forthcoming annual general meeting?
A. Fozia alone.
B. Danny and Fozia.
C. Edward and Fozia.
D. Danny and Edward.
Answer: C
NEW QUESTION: 3
The company receives a special order for 10,000 units at US $7.60. Variable selling cost for each of these 10,000 units will be US $1.20. This special order will not affect regular sales of 75.000 units. If the company accepts this special order, its profit will:
A. Decrease by US $12,000.
B. Increase by US $16,000.
C. Increase by US $8,000.
D. Decrease by US $4,000.
Answer: B
Explanation:
If the company accepts the special order, its revenue will increase by US $76,000 10,000 units x$7.60). However, its incremental cost will include only the variable costs because fixed manufacturing and selling costs will be unchanged. The increase in cost from accepting the special order is US $L 0,000 [10.000 units $3.00 + $1.00 + $0.80 +$1.20)]. Thus, acceptance of the special order will increase profits by US $16,000 $76,000 $60,000). A company manufactures and sells a single product. It takes two machine hours to produce unit. Annual sales are expected to be 75,000 units. Annual production capacity is 200,000 machine hours. Expected selling price is US $10 price unit. Cost data for manufacturing and selling the product are as follows:
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