Newman Inc. is a company that manufactures saddles specifically for horses that race in derbies in the U.S. and the UK. Within this context the firm is exhibiting the role of a ________ specialist
A) vertical-level
B) customer-size
C) product-line
D) job-shop
E) service
C
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Gage began a defined benefit pension plan on January 1, 2015. During 2015, the service cost was $450,000. Gage contributed $450,000 to the pension plan for 2015. The actuary said the projected benefit obligation at December 31, 2015 was $450,000. As of December 31, 2015, what statements can Gage make about the pension plan? I. The pension plan is fully funded. II. Gage does not need to report a
liability regarding the pension plan at December 31, 2015. ? A) I B) II C) both I and II D) neither I nor II
Which of the following formulas is the best representation of the concept of target costing?
a. target cost + profit margin = selling price b. selling price - target cost = profit margin c. selling price - profit margin = target cost d. target cost - standard cost = profit margin
Rocko Inc. has a machine with a book value of $50,000 and a five-year remaining life. A new machine is available at a cost of $85,000 and Rocko can also receive $38,000 for trading in the old machine. The new machine will reduce variable manufacturing costs by $14,000 per year over its five-year life. Should the machine be replaced?
A. No, because the company will be $23,000 worse off in total. B. No, because the income will decrease by $14,000 per year. C. Rocko will be not be better or worse off by replacing the machine. D. Yes, because income will increase by $14,000 per year. E. Yes, because income will increase by $23,000 in total.
Icarus Airway's decision to acquire Midas Fuels Inc. proved to be ill-fated because the Icarus managers overestimated their abilities and skills. They believed that they had the skills to manage such diversified businesses and create additional shareholder value. However, the acquisition failed to create the anticipated synergies because the managers' capabilities were restricted to the airline industry. What does this scenario best illustrate?
A. managerial hubris B. knowledge race C. unfettered free market D. competitive feasibility