Sneider Family Orange Groves processes a variety of fresh juices. The company has the following expenses for July:

72) Sneider Family Orange Groves processes a variety of fresh juices. The company has the following expenses for July:

Depreciation expense on bottling machines     $ 63,000
Glass juice bottles     $ 60,000
Commissions for salespeople     $ 30,000
Salaries of nutrition researchers     $ 75,000
Costs of maintaining website used for customer orders     $ 4,000
Wages of factory workers     $ 75,000
Freshness seals/caps for juice bottles     $ 3,000
Reconfiguring the factory layout     $122,000
Customer help line     $ 5,000
Costs of refrigerated trucks used to deliver juice     $ 25,000

What is the total cost for the research and development category of the value chain?
A) $75,000
B) $78,000
C) $63,000
D) $197,000
Answer:  A
Diff: 2
LO:  2-2
EOC:  E2-34B
AACSB:  Analytical Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

73) Sneider Family Orange Groves processes a variety of fresh juices. The company has the following expenses for July:

Depreciation expense on bottling machines     $ 63,000
Glass juice bottles     $ 60,000
Commissions for salespeople     $ 30,000
Salaries of nutrition researchers     $ 75,000
Costs of maintaining website used for customer orders     $ 4,000
Wages of factory workers     $ 75,000
Freshness seals/caps for juice bottles     $ 3,000
Reconfiguring the factory layout     $122,000
Customer help line     $ 5,000
Costs of refrigerated trucks used to deliver juice     $ 25,000

What is the total cost for the production category of the value chain?
A) $462,000
B) $60,000
C) $302,000
D) $201,000
Answer:  D
Explanation:  D) Calculations: $ 75,000 + 3,000 + 63,000 + 60,000 = $ 201,000
Diff: 2
LO:  2-2
EOC:  E2-33B
AACSB:  Analytical Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

74) Sneider Family Orange Groves processes a variety of fresh juices. The company has the following expenses for July:

Depreciation expense on bottling machines     $ 63,000
Glass juice bottles     $ 60,000
Commissions for salespeople     $ 30,000
Salaries of nutrition researchers     $ 75,000
Costs of maintaining website used for customer orders     $ 4,000
Wages of factory workers     $ 75,000
Freshness seals/caps for juice bottles     $ 3,000
Reconfiguring the factory layout     $122,000
Customer help line     $ 5,000
Costs of refrigerated trucks used to deliver juice     $ 25,000

What is the total cost for the design category of the value chain?
A) $122,000
B) $197,000
C) $152,000
D) $272,000
Answer:  A
Diff: 2
LO:  2-2
EOC:  E2-33B
AACSB:  Analytical Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

75) Sneider Family Orange Groves processes a variety of fresh juices. The company has the following expenses for July:

Depreciation expense on bottling machines     $ 63,000
Glass juice bottles     $ 60,000
Commissions for salespeople     $ 30,000
Salaries of nutrition researchers     $ 75,000
Costs of maintaining website used for customer orders     $ 4,000
Wages of factory workers     $ 75,000
Freshness seals/caps for juice bottles     $ 3,000
Reconfiguring the factory layout     $122,000
Customer help line     $ 5,000
Costs of refrigerated trucks used to deliver juice     $ 25,000

What is the total cost for the distribution category of the value chain?
A) $28,000
B) $29,000
C) $222,000
D) $151,000
Answer:  B
Explanation:  B) $4,000 + 25,000 = $29,000
Diff: 2
LO:  2-2
EOC:  E2-34B
AACSB:  Analytical Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

76) Sneider Family Orange Groves processes a variety of fresh juices. The company has the following expenses for July:

Depreciation expense on bottling machines     $ 63,000
Glass juice bottles     $ 60,000
Commissions for salespeople     $ 30,000
Salaries of nutrition researchers     $ 75,000
Costs of maintaining website used for customer orders     $ 4,000
Wages of factory workers     $ 75,000
Freshness seals/caps for juice bottles     $ 3,000
Reconfiguring the factory layout     $122,000
Customer help line     $ 5,000
Costs of refrigerated trucks used to deliver juice     $ 25,000

What is the total cost for the marketing category of the value chain?
A) $272,000
B) $34,000
C) $152,000
D) $197,000
Answer:  B
Explanation:  B) Calculations: $ 30,000 + 4,000 = $ 34,000
Diff: 2
LO:  2-2
EOC:  E2-34B
AACSB:  Analytical Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

77) Lucas Family Orange Groves processes a variety of fresh juices. The company has the following expenses for July:

Wages of factory workers     $ 75,000
Freshness seals/caps for juice bottles     $ 3,000
Reconfiguring the factory layout     $102,000
Customer help line     $ 2,000
Costs of refrigerated trucks used to deliver juice     $ 17,000
Depreciation expense on bottling machines     $ 63,000
Glass juice bottles     $ 54,000
Commissions for salespeople     $ 27,000
Salaries of nutrition researchers     $ 89,000
Costs of maintaining website used for customer orders     $ 4,000

What is the total cost for the customer service category of the value chain?
A) $2,000
B) $35,000
C) $80,000
D) $ 9,000
Answer:  A
Diff: 2
LO:  2-2
EOC:  E2-33B
AACSB:  Analytical Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

78) Delivery expenses are charged to which of the following areas?
A) Distribution
B) Customer service
C) Production or purchases
D) Marketing
Answer:  A
Diff: 2
LO:  2-2
EOC:  S2-3
AACSB:  Reflective Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

79) A product support hot line would be considered
A) marketing.
B) distribution.
C) production or purchases.
D) customer service.
Answer:  D
Diff: 2
LO:  2-2
EOC:  S2-3
AACSB:  Reflective Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits

80) Place the value chain elements in the correct order by numbering them from 1 to 6.

___    Design
___    Customer Service
___    Marketing
___    Research and Development
___    Distribution
___    Production or Purchases
Answer:  2, 6, 4, 1, 5, 3
Diff: 2
LO:  2-2
EOC:  S2-3
AACSB:  Reflective Thinking
Learning Outcome:  Define and use cost-volume-profit analysis to analyze the effects of changes
in costs and volume on a company's profits