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Question;Question 1;Which of the following is an advantage of corporations relative to partnerships;and sole;Harder to transfer;Lower taxes.;Most common form of organization.;Reduced legal liability for investors.;Question 2;The group of users of accounting;information charged with achieving the goals of the business is its;creditors.;investors.;managers.;auditors.;Question 3;Which of the following financial;statements is concerned with the company at a point in time?;Balance sheet.;Income statement.;Retained Earnings statement.;Statement of cash flows.;Question 4;An income statement;presents the revenues and expenses for a specific period of time.;summarizes the changes in retained earnings for a specific period of time.;reports the assets, liabilities, and stockholders? equity at a specific date.;reports the changes in assets, liabilities, and stockholders? equity over a;period of time.;Question 5;The most important information needed to determine if companies can pay their;current obligations is the;projected net income for next year.;net income for this year.;relationship between current assets and current liabilities.;relationship between short-term and long-term liabilities.;Question 6;A liquidity ratio measures;the;income or operating success of a company over a period of time.;percentage of total financing provided by creditors.;ability of a company to survive over a long period of time.;short-term ability of a company to pay its maturing obligations and to meet;unexpected needs for cash.;Question 7;The convention of consistency refers to consistent use of accounting principles;throughout the accounting periods.;within industries.;among accounting periods.;among firms.;Question 8;Horizontal analysis is also known as;vertical analysis.;trend analysis.;common size analysis.;linear analysis;Question 9;Horizontal analysis is a technique for evaluating a series of financial;statement data over a period of time;that has been arranged from the highest number to the lowest number.;to determine the amount and/or percentage increase or decrease that has taken;place.;to determine which items are in error.;that has been arranged from the lowest number to the highest number.;Question 10;Vertical analysis is a technique that expresses each item in a financial;statement;as a percent of the item in the previous year.;in dollars and cents.;as a percent of a base amount.;starting with the highest value down to the lowest value.;Question 11;Process costing is used when;production is aimed at filling a specific customer order.;costs are to be assigned to specific jobs.;the production process is continuous.;dissimilar products are involved.;Question 12;An important feature of a job order cost system is that each job;has its own distinguishing characteristics.;must be similar to previous jobs completed.;consists of one unit of output.;must be completed before a new job is accepted.;Question 13;In a process cost system, product costs are summarized;after each unit is produced.;on production cost reports.;when the products are sold.;on job cost sheets.;Question 14;An activity that has a direct cause-effect relationship with the resources;consumed is a(n);cost pool.;cost driver.;overhead rate.;product activity.;Question 15;Activity-based costing;accumulates overhead in one cost pool, then assigns the overhead to products;and services by means of a cost driver.;allocates overhead directly to products and services based on activity levels.;assigns activity cost pools to products and services, then allocates overhead;back to the activity cost pools.;allocates overhead to multiple activity cost pools, and it then assigns the;activity cost pools to products and services by means of cost drivers.;Question 16;A cost which remains constant per unit at various levels of activity is a;mixed cost.;variable cost.;fixed cost.;manufacturing cost.;Question 17;The break-even point is where;total variable costs equal total fixed costs.;total sales equal total variable costs.;contribution margin equals total fixed costs.;total sales equal total fixed costs.;Question 18;Fixed costs are $600,000 and the contribution margin per unit is $150. What is;the break-even point?;4,000 units;$1,500,000;$4,000,000;1,500 units;Question 19;When a company assigns the costs of direct materials, direct labor, and both;variable and fixed manufacturing overhead to products, that company is using;product costing.;operations costing.;absorption costing.;variable costing.;Question 20;If a divisionmanager?s compensation is based upon the;division?s net income, the manager may decide to meet the net income targets by;increasing production when using;absorption costing, in order to increase net income.;variable costing, in order to decrease net income.;absorption costing, in order to decrease net income.;variable costing, in order to increase net income.;Question 21;An unrealistic budget is;more likely to result when it;has been developed by all levels of management.;is developed with performance appraisal usages in mind.;has been developed in a top down fashion.;has been developed in a bottom up fashion.;Question 22;A major element in budgetarycontrol is;the comparison of actual results with planned objectives.;the valuation of inventories.;approval of the budget by the stockholders.;the preparation of long-term plans.;Question 23;The purpose of the sales budget report is to;control sales commissions.;control selling expenses.;determine whether sales goals are being met.;determine whether income objectives are being met.;Question 24;The accumulation of accounting;data on the basis of the individualmanager who has the;authority to make day-to-day decisions about activities in an area is called;static reporting.;master budgeting.;flexible accounting.;responsibility accounting;Question 25Variancereports are;external financial reports.;SEC financial reports.;internal reports for management.;all of these.;Question 26Internalreports that review the actual impact of decisions are;prepared by;factory workers.;the controller.;management accountants.;department heads.;Question 27;The process of evaluating financial;data that change under alternative courses of action is called;cost-benefit analysis.;double entry analysis.;contribution margin analysis.;incremental analysis.;Question 28;Seasons Manufacturing manufactures;a product with a unit variable cost of $100 and a unit sales price of;$176. Fixed manufacturing costs were $480,000 when 10,000;units were produced and sold. The company has a one-time opportunity to sell an;additional 1,000 units at $140 each in a foreign market which would not affect;its present sales. If the company has sufficient capacity to produce the;additional units, acceptance of the special order would affect net income as;follows;Income would decrease by $8,000.;Income would increase by $8,000.;Income would increase by $140,000.;Income would increase by $40,000.;Question 29;Carter, Inc. can make 100;units of a necessary component part with the following costs;Direct;Materials;$120,000;Direct Labor 20,000;Variable Overhead 60,000;Fixed;Overhead;40,000;If Carter can purchase the component externally for;$220,000 and only $10,000 of the fixed costs can be avoided, what is the;correct make-or-buy decision?;Buy and save $10,000;Make and save $30,000;Make and save $10,000;Buy and save $30,000;Question 30;A company has a process;that results in 15,000 pounds of Product A that can be sold for $16 per pound.;An alternative would be to process Product A further at a cost of $200,000 and;then sell it for $28 per pound. Should management sell Product A now or should;Product A be processed further and then sold? What is the effect of the action?;Sell now, the company will be better off by $200,000.;Process further, the company will be better off by $180,000.;Sell now, the company will be better off by $20,000.;Process further, the company will be better off by $20,000.


Paper#37188 | Written in 18-Jul-2015

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