Match Each One of the Examples Below with One of the Stages

question 18

Essay

Match each one of the examples below with one of the stages of the capital budgeting decision model.
Stages:
1. Identify Projects
2. Obtain Information
3. Make Predictions
4. Make Decisions by Choosing Among Alternatives
5. Implement the Decision, Evaluate Performance, and Learn

___a. Issuing corporate stock for the funds to purchase new equipment
___b. Learning how to effectively operate Machine \#8 only takes 15 minutes
___c. The need to reduce the costs to process the vegetables used in producing goulash
___d. Monitoring the costs to operate a new machine
___e. Percentage of defective merchandise considered too high
___f. Will introducing the new product substantially upgrade our image as a producer of quality products?
___g. Estimating yearly cash flows and setting investment bud gets accordingly using a 12-year planuning horizon.
___h. Use of the internal rate of return for eachalternative
___i. Tracking realized cash flows and comparing against estimated numbers.

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Definitions:

Markup

The sum added onto the purchase price of merchandise to cover both overhead expenses and profit, ultimately setting the retail price.

Predetermined Overhead Rate

A calculated rate used to assign overhead costs to products or services, based on estimated costs and activity levels.

Machine-Hours

The total time that machines are running in a production process, often used as a basis for allocating manufacturing overhead costs.

Job-Order Costing System

An accounting method that tracks costs individually for each job, suitable for companies producing unique or custom products.