Question 1 of 20 According to the cost allocation methods used in the company’s accounting system and described in the Help section for the Operations Report for any of the four geographic regions, your company’s administrative expenses are El allocated equally to each of the four geographical regions. El allocated to each of the four geographic regions based on each region’s percentage contribution to total companynivide revenues. El allocated to each of the four geographic regions according to their respective percentages of total cameras sold and then allocated between sales of entry-level cameras and multi-featured cameras within each region according to their respective percentages of total cameras sold. El allocated between entry—level cameras and multi—featured cameras according to their respective percentages of total companynivide revenues. El None of the above accurately describe the manner in which the company’s administrative expenses are allocated. Assume a company’s Income Statement for a given period has the following entries: II’ICCIIIE Statenlerlt Data Quarter 1 cm nuns) Sales Revenues $5i},{}t}i} Production Costs 25,50!) Delivery Costs 1,500 Marketing Costs 11,5011 Administrative Expenses 2,90!) Operating Profit 14,40!) Net Interest 2,4011} Income Before Taxes 1AM Taxes 3,601?) Net Income $5.4m} Given the above figures, the companya€ms net profit margin {defined as net income divided by sales revenues, as per the Help screen for the Comparative Financial Performance page of the GSR) is E! 15.11% E? 22.3% E! 119% E! 19.1% tit 16.8% Question 3 of It} mPt’flQlIEtiflfl: 123EEEEEEEEEEHEEEEEE 11′ in a given year a company spends $3 million on new product development, design, and engineering for its entry-level camera line; $5 million on new product development, design, and engineering for its multi—featured camera line; assembles and ships 1,{}DD,{}{}D entry-level cameras and 2oo,ooo multi— featured cameras, then the company’s production costs for new product development expenditures for multi-featured cameras would be @ $25.flfl per camera [a $5.5? per camera [a $3.1m per camera [a capitalized and depreciated over the next five years, thus producing an average cost of $5.oo annually for each of the next five years [a Hone ofthese Question 4 of 20 mPtflQI-Ifitilfl: 1234§§EEEEQEEEEEEEEE According to explanations provided on the Help screens for the Production Cost Report, if a company pays a PAT member a $25,111“) annual compensation package, utilizes no overtime, employs zoo PATs, spends $1,{}{J-{} per quarter for training and productivity improvement for each PAT, incurs no severance expenses, and has annual PAT productivity of 12,ooo cameras, then the company.s in-house labor cost per camera assembled at regular time {no use of overtime) would be @I $3.45? If?! $3.33 E3 $5.1? LE?! $1o.oo If? Cannot be determined from the information provided miter Financial Data Depreciation $4,000 0ividend payments $2,250 Based on the above figures, the company’s capital structure {defined as the sum of total debt outstanding and total stockholder’s equity) consists of what percentages of debt and equity? The percentages of total capital invested that are debt-financed and equity-financed are among the factors used to determine a company’s credit rating, as explained in the Help section for the Comparative Financial Performances presented on p. F of the GED-BUS Statistical Review.) E?! 20% debt and 00% equity or 20:00. E5 25% debt and 55% equity or 25:55. @I 35% debt and 55% equity or 35:55. [a 54% debt and 40% equity or 54:45. [a None of these. Question iii of 20 If a company earns net income of $30 million in Year 0, has 10 million shares of stock, pays a dividend of $1.50 per share, and has annual interest costs of $10 million, then C] the company’s retained earnings for Year 0 would be $13 million (net income of $30 million less dividend payments of $15 million less $10 million in interest payments). 6 the company’s retained earnings for Year 0 would be $35 million. Cl the company’s earnings per share would be $2.30. @ the company’s retained earnings For Year a would be $23 million {net income of $33 million less dividend payments of $15 million}; the $23 million in retained earnings would cause the company’s accumulated retained earnings account on the company’s balance sheet to go up by $23 million, thus resulting in $23 million of additional equity investment by stockholders in Year 3. Cl the company’s retained earnings for the year would be $20 million (net income of $38 million less interest payments of $10 million). Question 12 of 20 mPtfl’QIEIJ-flfl: lgéflfifilflflflfllzfiflfififlflfifl According to the cost allocation methods used in the company’s accounting system that are described in the Production Cost Report, if a company employs 100 PATs at a total labor cost of $9,000,000 {including wages, fringes, incentives, overtime, training, and severance expenses), assembles and ships 000,000 entry-level cameras and 200,000 multi-featured cameras over the course of a year, has revenues of $00 million from sales of entry level cameras, and revenues of $120 million from the sale of multi-featured cameras, then the total annual labor costs allocated to the assembly and shipment of entry-level cameras and the labor costs per entry—level camera assembled and shipped, respectively, will be E! $3,000,000 and $0.00. LE) 9,200,000 and $0.00. E! $4,500,000 and $5.03. E! $5,000,000 and $0.00. IE! $5,000,000 and $20.00. Question 13 of 20 llnptflmmliin: 12345EITE-91011E13fififlflflflfl According to the depreciation rates used by the company and described in the Production Cost Report, if a company adds ?‘0 new workstations at a cost of $250,000 each and also spends $5 million for an addition to its assembly plant to accommodate the new workstations, then its annual depreciation costs will rise by E! $200,000 E! $125,000 it $000,000 E! $2,250,000 El None ofthese Question 15 of 20 llnptflthflfithn: 123450?8910111213fl15flflflflfl which of the following is not an action company co-managers can take to boost a subpar RDE’? El Increase dividend payments so as to reduce the amount of net income retained in the business {retained earnings act to increase equity investment and thus dampen RDE) El Issue additional shares of stock and use the proceeds to pay down the debt outstanding on the company’s line of credit El Strive to boost the company’s net income El Use available cash (or perhaps borrow against the company’s line of credit) to repurchase shares of stock El Hone ofthese Question 16 of 20 llnptflmlmtiln: 12345IETES’101112131-4fi161 1 1 0 Given the following Financial Statement data: Inemne Statement Data Fill Veer {‘II 0005} Sales Revenues $200,000 Operating Profit 48,000 Net Interest 11,000 Net Income $25,900 Balance Sheet Date Total Current Assets $?0,000 Total Assets 139,000 Total Current Liabilities 26,000 L-T Debt {draw against credit line) 23,000 Total Equity 90,000 Other Financial Data Depreciation $16,000 Dividend payments $9,000 Based on the above figures, the company’s debt payback period {the number of years required to pay off loans outstanding; see the discussion on the Help screen for the Comparative Financial Performance page of the GER. for more details of how to calculate the debt payback period} is [a 2.31 years [a 2.11)] years Eh 5.25]I years $1 2.95 yea rs if? None ofthese Question 19 of El) mPtflQlEIJ-flfl: lgéififilfiflflflflflflfiflflflfl’fl According to the cost allocation methods used in the company’s accounting system and described in the Help section for the Dperations Report for any of the four geographic regions, if a company spends $5 million to advertise its camera lines in North America, assembles and ships 3oo,ooo entry-level cameras and ED111300 multi-featured cameras to its North American dealers, derives revenues of $343I million from its sales of entry—level cameras and $153} million from the sales of its multi—featured cameras in North America, then [a 50% of the $5 million in advertising expenditures will be allocated to the costs of advertising for entry-level cameras and 50% will be allocated to the costs of multi-featured cameras. [a MEG: of the $5 million in advertising expenditures will be allocated to the costs of advertising for entry-level cameras and 311351: will be allocated to the costs of multi-featured cameras. [a the per camera advertising costs for both entry-level and multi-featured cameras will be $1U.UU. @ 4% of the $5 million in advertising expenditures will be allocated to the costs of advertising for entry—level cameras and «50% will be allocated to the costs of multi—featured cameras. ’51 the per camera advertising costs for entry-level cameras will be 50% larger than the per camera advertising costs for multi—featured cameras

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