14. A rolling budget is a budget that

A. extends 5minus10 years into the future.

B.is executed by upper management.

C.is continuously updated, so that the next 12 months of operations are always budgeted.

D. begins with zero for each expense, and then amounts are added in.

You win the lottery and must decide how to take the payout. Use a 44% discount rate. What is the present value of $12,000 a year received at the end of each of the next six years? (The present value of annuity for this scenario 5.242.)

A. $72,000 B. $9,480 C. $41,580 D. $62,904

19. Gomez Corporation is considering two alternative investment proposals with the following data:

Proposal X Proposal Y

Investment $800,000 $462,000

Useful life 8 years 8 years

Estimated annual net cash inflows for 8 years $120,000 $ 76,000

Residual value $56,048 $

Depreciation method Straightline Straightline

Required rate of return 19% 12%

How long is the payback period for ProposalX?

A 6.67 years B.14.27 years C.10.53 years D.6.08 years

Gomez Corporation is considering two alternative investment proposals with the followingdata:

Proposal X Proposal Y

Investment $850,000 $468,000

Useful life 8 years 8 years

Estimated annual net cash inflows for 8 years $125,000 $ 78,000

Residual value $40,000 $

Depreciation method Straightline Straightline

Required rate of return 14% 10%

What is the accounting rate of return for ProposalY?

A. 5.24% B.29.17% C.16.67% D.4.17%

21.Jackson Industries has collected the following data for one of its products:

Direct materials standard (6 pounds per unit @ $0.55/lb.) $3.30 per finished good

Actual direct materials purchased $38,000 pounds

Actual Direct Materials Used (AQU) 35,000 pounds

Actual Price (AP) paid per pound $0.60

How much is the direct materials price variance?

A.$1,750 favorable B.$1,900 favorable C.$1,900 unfavorable D.$1,750 unfavorable