____ 36. In contrast to the total product and variable cost concepts used in setting seller's prices, the target cost approach assumes that:

a.	a markup is added to total cost
b.	selling price is set by the marketplace
c.	a markup is added to variable cost
d.	a markup is added to product cost

____ 37. The profit margin for Division E is 28% and the investment turnover is 2.8. What is the rate of return on investment for Division E?

a.	20%
b.	28%
c.	14%
d.	78.4%

____ 38. If variable costs per unit decreased because of a decrease in utility rates, the break-even point would:

a.	decrease
b.	increase
c.	remain the same
d.	increase or decrease, depending upon the percentage increase in utility rates

____ 39. Nevitt Corp.s static budget for 10,000 units of production includes $50,000 for direct materials, $44,000 for direct labor, utilities of $5,000, and supervisor salaries of $15,000. A flexible budget for 12,000 units of production would show:

a.	the same cost structure in total
b.	direct materials of $60,000, direct labor of $52,800, utilities of $6,000, and supervisor salaries of $18,000
c.	total variable costs of $136,800
d.	direct materials of $60,000, direct labor of $52,800, utilities of $6,000, and supervisor salaries of $15,000

____ 40. Which types of inventories does a manufacturing business report on its balance sheet?

a.	Finished goods inventory and work in process inventory
b.	Direct materials inventory and work in process inventory
c.	Direct materials inventory, work in process inventory, and finished goods inventory
d.	Direct materials inventory and finished goods inventory