Reference: 22_07
Assume Rock Bottom Golf Is Divided into Four

question 86

Multiple Choice

Reference: 22_07
Assume Rock Bottom Golf is divided into four departments that operate as profit centers and that the data below is from the most recent fiscal year.
$\begin{array}{lrrrr}&\text { Golf Clubs}&\text { Golf Bags}&\text { Golf Balls }&\text { Golf Apparel }\\\text { Sales } & \$ 200,000 & \$ 400,000 & \$ 800,000 & \$ 1,600,000 \\\text { Cost of goods } & 90,000 & 220,000 & 400,000 & 960,000\\\text { Sold}\\\text { Direct expenses}\\\text { Salaries } & 18,000 & 54,000 & 90,000 & 226,000 \\\text { Insurance } & 2,000 & 3,000 & 6,000 & 120,000 \\\text { Utilities } & 1,000 & 2,000 & 3,000 & 10,000\end{array}$
-Given the information above,list Rock Bottom Golf's departments in order of highest departmental contribution to overhead to lowest departmental contribution to overhead.

• A) Golf Balls, Golf Apparel, Golf Bags, Golf Clubs.
• B) Golf Apparel, Golf Balls, Golf Bags, Golf Clubs.
• C) Golf Clubs, Golf Bags, Golf Balls, Golf Apparel.
• D) Golf Clubs, Golf Bags, Golf Apparel, Golf Balls.
• E) Golf Balls, Golf Apparel, Golf Clubs, Golf Bags.

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Definitions:

IASB

International Accounting Standards Board, an independent organization that develops and approves International Financial Reporting Standards (IFRS).

Financial Accounting Standards

Rules and standards set by authoritative bodies that dictate how companies prepare and present their financial statements.

AICPA

Stands for American Institute of Certified Public Accountants, a professional organization for Certified Public Accountants (CPAs) in the United States.

SEC

The U.S. Securities and Exchange Commission, the federal agency responsible for enforcing federal securities laws and regulating the securities industry.