Case #5

A new wood heading oven would cost $___ more to produce.

• $30

• $20

• $5

• $10

Bridgewater utilizes a ___ income statement.

• Multi-Step

• Single-Step

Answer explanation

Multi-Step

Draw a picture of what Bridgewater sells (You have 1 minute).

Which choice is NOT a reason cost increased with the introduction of ovens?

• Marketing

• Hiring new sales reps

• Fleet expansions

• Addition of a new building

Selling & shipping costs were charged based on the percent of sales dollars across the two product lines.

• True

• False

Answer explanation

This can result in an understatement of costs for a particular product line.

Which choice is true about the stove & oven's general expenses?

• Oven general expenses are higher

• Stove general expenses are higher

• Stove & Oven general expenses were roughly equal

Was there a market for wood-burning ovens when Bridgewater began to sell them?

• Yes, they saw the market growing & decided to hop in

• No, they had to create the market

The new wood-burning ovens could be sold for an additional $___ per unit.