Factors that can affect pricing decisions include all of the following except.

Single
choice.
(choices)
cost considerations.
environment.
pricing objectives.
All of these are factors.
2.In most cases, prices are set by the. Single choice.
(choices)
customers.
competitive market.
largest competitor.
selling company.
3.A company must price its product to cover its costs and earn a reasonable
profit in. Single choice.
(choices)
all cases.
its early years.
the long run.
the short run.
4.Prices are set by the competitive market when. Single choice.
(choices)
the product is specially made for a customer.
there are no other producers capable of manufacturing a similar item.
a company can effectively differentiate its product from others.
a product is not easily distinguished from competing products.
5.All of the following are factors that can affect pricing decisions except. Single
choice.
(choices)
cost considerations.
demand.
environment.
All of these are factors.
6.Bond Co. is using the target cost approach on a new product. Information
gathered so far reveals: Expected annual sales 400,000 units Desired profit per
unit P0.35 Target cost P168,000 What is the target selling price per unit?. Single
choice.
(choices)
P0.42
P0.70
P0.35
P0.77
7.Well Water Inc. wants to produce and sell a new flavored water. In order to
penetrate the market, the product will have to sell at P2.00 per 12 oz. bottle. The
following data has been collected: Annual sales 50,000 bottles Projected selling
and administrative costs P8,000 Desired profit P70,000 The target cost per bottle
is. Single choice.
(choices)
P0.44.
P0.60.
P0.16.
P0.40.
8.Larry Cable Inc. plans to introduce a new product and is using the target cost
approach. Projected sales revenue is P810,000 (P4.05 per unit) and target costs
are P730,000. What is the desired profit per unit?. Single choice.
(choices)
P0.40
P2.03
P3.65
None of the above
9.Wasson Widget Company is contemplating the production and sale of a new
widget. Projected sales are P300,000 (or 75,000 units) and desired profit is
P36,000. What is the target cost per unit?. Single choice.
(choices)
P4.00
P3.52
P4.48
 P4.80
10.Boomer Boombox Inc. wants to produce and sell a new lightweight radio.
Desired profit per unit is P1.84. The expected unit sales price is P22 based on
10,000 units. What is the total target cost?. Single choice.
(choices)
P201,600
P220,000
P18,400
P238,400
11.In cost-plus pricing, the markup consists of. Single choice.
(choices)
manufacturing costs.
desired ROI.
selling and administrative costs.
total cost and desired ROI.
12.The desired ROI per unit is calculated by. Single choice.
(choices)
multiplying the ROI by the investment and dividing by the estimated volume.
multiplying the unit selling price by the ROI.
dividing the total cost by the estimated volume and multiplying by the ROI.
dividing the ROI by the estimated volume and subtracting the result from the unit cost.
13.Bellingham Suit Co. has received a shipment of suits that cost P200 each. If the
company uses cost-plus pricing and applies a markup percentage of 60%, what is
the sales price per suit?. Single choice.
(choices)
P333
P320
P280
P500
14.Custom Shoes Co. has gathered the following information concerning one
model of shoe: Variable manufacturing costs P40,000 Variable selling and
administrative costs P20,000 Fixed manufacturing costs P160,000 Fixed selling
and administrative costs P120,000 Investment P1,700,000 ROI 30% Planned
production and sales 5,000 pairs What is the total cost per pair of shoes?. Single
choice.
(choices)
P40
P68
P168
P96
15.Custom Shoes Co. has gathered the following information concerning one
model of shoe: Variable manufacturing costs P40,000 Variable selling and
administrative costs P20,000 Fixed manufacturing costs P160,000 Fixed selling
and administrative costs P120,000 Investment P1,700,000 ROI 30% Planned
production and sales 5,000 pairs What is the desired ROI per pair of shoes?.
Single choice.
(choices)
P68
P168
P102
P170
16.Custom Shoes Co. has gathered the following information concerning one
model of shoe: Variable manufacturing costs P40,000 Variable selling and
administrative costs P20,000 Fixed manufacturing costs P160,000 Fixed selling
and administrative costs P120,000 Investment P1,700,000 ROI 30% Planned
production and sales 5,000 pairs What is the target selling price per pair of
shoes?. Single choice.
(choices)
P142
P170
P114
P158
17.Custom Shoes Co. has gathered the following information concerning one
model of shoe: Variable manufacturing costs P40,000 Variable selling and
administrative costs P20,000 Fixed manufacturing costs P160,000 Fixed selling
and administrative costs P120,000 Investment P1,700,000 ROI 30% Planned
production and sales 5,000 pairs What is the markup percentage?. Single choice.
(choices)
 150%
255%
850%
182%
18.Lock Inc. has collected the following data concerning one of its products: Unit
sales price P145 Total sales 15,000 units Unit cost P115 Total investment
P1,800,000 The ROI percentage is. Single choice.
(choices)
20%.
25%.
30%.
35%.
19.Lock Inc. has collected the following data concerning one of its products: Unit
sales price P145 Total sales 15,000 units Unit cost P115 Total investment
P1,800,000 The markup percentage is. Single choice.
(choices)
20.69%.
22.59%.
25%.
26.09%.
20.A company using cost-plus pricing has an ROI of 24%, total sales of 20,000
units and a desired ROI per unit of P30. What was the amount of investment?.
Single choice.
(choices)
P144,000
P2,500,000
P456,000
P789,475
21.Brislin Products has a new product going on the market next year. The
following data are projections for production and sales: Variable costs P250,000
Fixed costs P450,000 ROI 14% Investment P2,000,000 Sales 200,000 units What is
the target selling price per unit?. Single choice.
(choices)
P4.90
 P3.50
P2.65
P3.65
22.Brislin Products has a new product going on the market next year. The
following data are projections for production and sales: Variable costs P250,000
Fixed costs P450,000 ROI 14% Investment P2,000,000 Sales 200,000 units What is
the markup percentage?. Single choice.
(choices)
112%
20%
62%
40%
23.What would the markup percentage be if only 150,000 units were sold and
Brislin still wanted to earn the desired ROI?. Single choice.
(choices)
32.95%
53.33%
35.0%
44.00%
24.When using cost-plus pricing, which amount per unit does not change when
the expected volume differs from the budgeted volume?. Single choice.
(choices)
Variable cost
Fixed cost
Desired ROI
Target selling price
25.Why does the unit selling price increase when expected volume is lower than
budgeted volume?. Single choice.
(choices)
Variable costs and fixed costs have to be spread over fewer units.
Fixed costs and desired ROI have to be spread over fewer units.
Variable costs and desired ROI have to be spread over fewer units.
Fixed costs only have to be spread over fewer units.
26.In cost-plus pricing, the target selling price is computed as. Single choice.
(choices)
variable cost per unit + desired ROI per unit.
fixed cost per unit + desired ROI per unit.
total unit cost + desired ROI per unit.
variable cost per unit + fixed manufacturing cost per unit + desired ROI per unit.
27.In cost-plus pricing, the markup percentage is computed by dividing the
desired ROI per unit by the. Single choice.
(choices)
fixed cost per unit.
total cost per unit.
total manufacturing cost per unit.
variable cost per unit.
28.The following per unit information is available for a new product of Red
Ribbon Company: Desired ROI P 20 Fixed cost 40 Variable cost 60 Total cost 100
Selling price 120 Red Ribbon Company’s markup percentage would be. Single
choice.
(choices)
17%.
20%.
33%.
50%.
29.Bryson Company has just developed a new product. The following data is
available for this product: Desired ROI per unit P 30 Fixed cost per unit 50
Variable cost per unit 75 Total cost per unit 125 The target selling price for this
product is. Single choice.
(choices)
P155.
P125.
P105.
P80.
30.The first step for time-and-material pricing is to calculate the. Single choice.
(choices)
charge for obtaining materials.
 charge for holding materials.
labor charge per hour.
charges for a particular job.
31.The labor charge per hour in time-and-material pricing includes all of the
following except. Single choice.
(choices)
an allowance for a desired profit.
charges for labor loading.
selling and administrative costs.
overhead costs.
32.The last step in determining the material loading charge percentage is to.
Single choice.
(choices)
estimate annual costs for purchasing, receiving, and storing materials.
estimate the total cost of parts and materials.
divide material charges by the total estimated costs of parts and materials.
add a desired profit margin on the materials themselves.
33.In time-and-material pricing, the charge for a particular job is the sum of the
labor charge and the. Single choice.
(choices)
materials charge.
material loading charge.
materials charge + desired profit.
materials charge + the material loading charge.
34.The following data is available for Wheels ‘N Spokes Repair Shop for 2016:
Repair technicians’ wages P360,000 Fringe benefits 80,000 Overhead 60,000 Total
P500,000. The desired profit margin is P40 per labor hour. The material loading
charge is 40% of invoice cost. It is estimated that 5,000 labor hours will be
worked in 2016. Wheels ‘N Spokes’ labor charge per hour in 2016 would be.
Single choice.
(choices)
P100.
P112.
 P128.
P140.
35.The following data is available for Wheels ‘N Spokes Repair Shop for 2016:
Repair technicians’ wages P360,000 Fringe benefits 80,000 Overhead 60,000 Total
P500,000 The desired profit margin is P40 per labor hour. The material loading
charge is 40% of invoice cost. It is estimated that 5,000 labor hours will be
worked in 2016. In January 2016, Wheels ‘N Spokes repairs a bicycle that uses
parts of P180. Its material loading charge on this repair would be. Single choice.
(choices)
P72.
P108.
P180.
P252.
36.The following data is available for Wheels ‘N Spokes Repair Shop for 2016:
Repair technicians’ wages P360,000 Fringe benefits 80,000 Overhead 60,000 Total
P500,000 The desired profit margin is P40 per labor hour. The material loading
charge is 40% of invoice cost. It is estimated that 5,000 labor hours will be
worked in 2016. In March 2016, Wheels ‘N Spokes repairs a bicycle that takes two
hours to repair and uses parts of P240. The bill for this repair would be. Single
choice.
(choices)
P520.
P560.
P592.
P616.
37.Which of the following organizations would most likely not use time-and-
material pricing?. Single choice.
(choices)
Automobile repair company
Engineering firm
Custom furniture manufacturer
Public accounting firm
38.Carlos Consulting Inc. provides financial consulting and has collected the
following data for the next year’s budgeted activity for a lead consultant.
Consultants’ wages P90,000 Fringe benefits P22,500 Related overhead P17,500
Supply clerk’s wages P18,000 Fringe benefits P4,000 Related overhead P20,000
Profit margin per hour P20 Profit margin on materials 15% Total estimated
consulting hours 5,000 Total estimated material costs P168,000 The labor rate per
hour is. Single choice.
(choices)
P42.50.
P26.00.
P41.50.
P46.00.
39.Carlos Consulting Inc. provides financial consulting and has collected the
following data for the next year’s budgeted activity for a lead consultant.
Consultants’ wages P90,000 Fringe benefits P22,500 Related overhead P17,500
Supply clerk’s wages P18,000 Fringe benefits P4,000 Related overhead P20,000
Profit margin per hour P20 Profit margin on materials 15% Total estimated
consulting hours 5,000 Total estimated material costs P168,000 The material
loading charge is. Single choice.
(choices)
15%.
25%.
40%.
55%.
40.Carlos Consulting Inc. provides financial consulting and has collected the
following data for the next year’s budgeted activity for a lead consultant.
Consultants’ wages P90,000 Fringe benefits P22,500 Related overhead P17,500
Supply clerk’s wages P18,000 Fringe benefits P4,000 Related overhead P20,000
Profit margin per hour P20 Profit margin on materials 15% Total estimated
consulting hours 5,000 Total estimated material costs P168,000 A consulting job
takes 20 hours of consulting time and P180 of materials. The client’s bill would
be. Single choice.

(choices)
P1,172.
b. P772.
c. P952.
d. P1,100