A large retail customer made an offer to buy 10,000 units at a special price of $7 per unit. The manufacturer usually sells each unit for $10. Variable manufacturing costs are $5 per unit andfixed manufacturing costs are
$3 per unit. For the manufacturer to accept the offer, which of the following assumptions needs to be true?

• A.Fixed and variable manufacturing costs are less than the special offer selling price
• B.The manufacturer can fulfill the order without expanding the capacities of the production facilities
• C.Costs related to accepting this offer can be absorbed through the sale of other products
• D.The manufacturer's production facilities are currently operating at full capacity

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Which of the following is a primary driver behind the creation and prioritization of new strategic initiatives established by an organization?

• A.Risk tolerance.
• B.Performance.
• C.Threats and opportunities.
• D.Governance.

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A manufacturer receives an advance payment for special-order goods that are to be manufactured and delivered within the next year. The advance payment should be reported in the manufacturer's current-year balance sheet as a(n):

• A.Current liability
• B.Noncurrent liability
• C.Contra asset amount.
• D.Accrued revenue.

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What are the objectives of governance as defined by the Standards?

• A.Add value, improve, assure, and conform.
• B.Identify, assess, manage, and control.
• C.Organize, assign, authorize, and implement.
• D.Inform, direct, manage, and monitor.

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A manufacturing company produces plastic utensils for a particular segment at the lowest possible cost. The company is pursuing a cost:

• A.Leadership strategy.
• B.Focus strategy.
• C.Differentiation strategy.
• D.Containment strategy.

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