The Machining Division Has a Capacity of 2,000 Units

question 41

Multiple Choice

The Machining Division has a capacity of 2,000 units. Its sales and cost data are: Selling price per unit $100
Variable manufacturing costs per unit $25
Variable administrative costs per unit $5
Total fixed manufacturing overhead $20,000
Total fixed administrative costs $5,000
Residual income is:

• A)The same as return on investment
• B)A nonfinancial measure of performance
• C)Net operating income minus a required rate of return X average operating assets
• D)Sales divided by net operating income

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Definitions:

Agenda

A planned list or outline of items to be discussed, actions to be taken, or points to be considered in a meeting or event.

Time-intensive

Requiring a significant amount of time to complete.

Cost Effectively

Achieving an intended outcome or maintaining quality while minimizing expenses, often applied in the context of budgeting and financial planning in various fields.

Internet

A global network of computers and servers that supports vast amounts of information sharing and communication.