9. The time expected to pass before the net cash flows from an investment would retm its initial cost is called the amortization period per a. True b. False $17.50 10. If NPV is less than zero, it means that the proposed it means that the proposed project is viable a. True b. False SECTION B: MULTIPLE CHOICE QUESTIONS (20 POINTS) 11. The of action as compared with an alternative is amount of increase or decrease in cost that is expected from a particular course a. period cost b. product cost c. differential cost d. discretionary cost 15 12. The condensed income statement for a Fletcher Inc. for the past year is as foliows: Product Sales Costs: $300,000 $210.000 $340000 $850.00 Variable costs Fixed costs Total costs $180,000 $180,000 $220,000 $580,000 50,000 50 40.000 1400 230.000 $230,000 $260.000 $720,000 Income (loss) Management is considering the discontinuance of the manufacture and sale of Product G at the beginning of the current year. The discontinuance would have no effect on the total fixed costs variable costs and the sales of Products F and H. What is the amount of change in net income for the current year that will result from the discontinuance of Product G? a. $20,000 increase b. $20,000 decrease c. $30,000 increase d. $30,000 decrease 13, Piper Corp is operating at 70%of capacity and is currently purchasing a part used in its manufacturing operations for $24 per unit. The unit cost for the business to make the part is $36, including fixed costs, and $26, not including fixed costs. If 15,000 units of the part are normally purchased during the year but could be manufactured using unused capacity, what would be the amount of differential cost increase or decrease from making the part rather than purchasing it? a. $30,000 cost decrease b. $180,000 cost increase c. $30,000 cost increase d. $180,000 cost decrease