National Inc

question 94

Multiple Choice

National Inc. manufactures two models of CMD that can be used as cell phones, MPX, and digital camcorders.Using activity-based costing, applied machinery overhead for the Great P model per unit is (rounded to the nearest cent) :

• A)$4.60.
• B)$9.45.
• C)$13.44.
• D)$15.12.
• E)$42.61.

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Definitions:

Business Risks

The exposure a company or organization faces from factors that may affect its ability to achieve its objectives or financial goals.

Financial Risks

The risk of experiencing financial loss from an investment or entrepreneurial activity.

Financial Leverage

The use of borrowed funds to increase the potential return of an investment, which also increases the risk of loss.

Sensitivity of EPS

The degree to which a company's earnings per share (EPS) is affected by fluctuations in its operating income.