Beta Company Is Preparing Its Annual Profit Plan

question 14

Multiple Choice

Beta Company is preparing its annual profit plan.As part of its analysis of the profitability of its customers,management estimates that the $12,000 for sales support should be assigned to the individual customers from the information given as follows: What is the amount of the sales support costs that should be allocated to Customer B,assuming Beta uses purchases orders to compute activity-based costs?

• A)$2,400.
• B)$4,000.
• C)$8,000.
• D)$9,600.

Understand the concept of residual income as a performance evaluation metric.

Calculate divisional performance using residual income.

Analyze the impact of internal transactions on divisional and overall company profitability.

Determine the appropriate cost allocation for shared services between different parts of an organization.

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Definitions:

Positive Self-concept

An individual’s perception of oneself that is characterized by positivity, confidence, and self-worth.

Unconditional Positive Regard

Unconditional positive regard is a concept in psychology where an individual is accepted and loved as they are, without conditions or judgments.

Carl Rogers

A pioneering psychologist who founded client-centered therapy, emphasizing the importance of unconditional positive regard and empathy in the therapeutic process.

Personal Growth

The process of improving self-awareness, developing talents, and potential, and enhancing the quality of life.