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Accounting Multiple Choice Questions




Question;Which of the;following costs would be classified as a prevention cost on a quality report?;Reliability engineering.?;Materials inspection.?;Rework.?;Warranty repairs.?;Out-of-court liability settlements.?;The provisions of section 302 of the Sarbanes-Oxley;Act (as originally enacted) require the signing officers of a company to do all;of the following except;Audit the internal controls over;financial reporting.?;Establish the internal controls over;financial reporting.?;Maintain the internal controls over;financial reporting.?;Evaluate the internal controls over;financial reporting.?;Disclose material weaknesses in the;internal controls over financial reporting.?;A manufacturer's raw-material;purchasing department would likely be classified as a;cost center.?;revenue center.?;profit center.?;investment center.?;contribution center.?;A general calculation method for;transfer prices that achieves goal congruence begins with the additional outlay;cost per unit incurred because goods are transformed and then;adds the opportunity cost per unit to;the organization because of the transfer.?;subtracts the opportunity cost per;unit to the organization because of the transfer.?;adds the sunk cost per unit to the;organization because of the transfer.?;subtracts the sunk cost per unit to;the organization because of the transfer.?;adds the sales revenue per unit to;the organization because of the transfer.?;A responsibility center in which the;manager is held accountable for the profitable use of assets and capital is;commonly known as a(n);cost center.?;revenue center.?;profit center.?;investment center.?;contribution center.;Controllable costs, as used in a;responsibility accounting system, consist of;only fixed costs.?;only direct materials and direct;labor.?;those costs that a manager can;influence in the time period under review.?;those costs about which a manager has;some knowledge.?;those costs that are influenced by;parties external to the organization.?;The Little Rock Division of Classics;Companies currently reports a profit of $3.6 million. Divisional invested;capital totals $9.5 million, the imputed interest rate is 12%. On the basis of;this information, Little Rock's residual income is;$432,000.?;$708,000.?;$1,140,000.?;$2,460,000.?;some other amount.?;Sand Fly Corporation operates two;stores: J and K. The following information relates to J:?Sales;revenue $1,300,000?Variable operating expenses 600,000?Fixed;expenses:? Traceable to J and controllable by J;275,000? Traceable to J and controllable by;others 80,000?J's segment contribution margin is;$345,000.??;$425,000.??;$620,000.??;$700,000.??;$745,000.;The basic idea behind residual income;is to have a division maximize its;earnings per share.?;income in excess of a corporate;imputed interest charge.?;cost of capital.?;cash flows.?;invested capital.?;ROI is most appropriately used to;evaluate the performance of;cost center managers.?;revenue center managers.?;profit center managers.?;investment center managers.?;both profit center managers and;investment center managers.?;The difference between the profit;margin controllable by a segment manager and the segment profit margin is;caused by;variable operating expenses.?;allocated common expenses.?;fixed expenses controllable by the;segment manager.?;fixed expenses traceable to the;segment but controllable by others.?;sales revenue.;Sunrise Corporation has a return on;investment of 15%. A Sunrise division, which currently has a 13% ROI and;$750,000 of residual income, is contemplating a massive new investment that;will (1) reduce divisional ROI and (2) produce $120,000 of residual income. If;Sunrise strives for goal congruence, the investment;should not be acquired because it;reduces divisional ROI.?;should not be acquired because it;produces $120,000 of residual income.?;should not be acquired because the;division's ROI is less than the corporate ROI before the investment is;considered.?;should be acquired because it;produces $120,000 of residual income for the division.?;should be acquired because after the;acquisition, the division's ROI and residual income are both positive numbers.?;Which of the following bodies;oversees audits and auditors, and sanctions firms and individuals for;violations of laws and regulations?;American Institute of Certified;Public Accountants (AICPA).?;American Accounting Association;(AAA).?;Public Company Accounting Oversight;Board (PCAOB).?;Financial Accounting Standards Board;(FASB).?;Accounting Principles Board (APB).?;When managers of subunits throughout;an organization strive to achieve the goals set by top management, the result;is;goal congruence.?;planning and control.?;responsibility accounting.?;delegation of decision making.?;strategic control.;Which of the following is the correct;mathematical expression to derive a company's capital turnover?;Sales revenue / invested capital.?;Contribution margin / invested;capital.?;Income / invested capital.?;Invested capital / sales revenue.?;Invested capital / income.;Which of the following describes the;goal that should be pursued when setting transfer prices?;Maximize profits of the buying;division.?;Maximize profits of the selling;division.?;Allow top management to become;actively involved when calculating the proper dollar amounts.?;Establish incentives for autonomous;division managers to make decisions that are in the overall organization's best;interests (i.e., goal congruence).?;Minimize opportunity costs.?;Weston Company had sales revenue and;operating expenses of $5,000,000 and $4,200,000, respectively, for the year;just ended. If invested capital amounted to $6,000,000, the firm's ROI was;13.33%.?;83.33%.?;120.00%.?;750.00%.?;some other figure.?;The amounts charged for goods and;services exchanged between two divisions are known as;opportunity costs.?;transfer prices.?;standard variable costs.?;residual prices.?;target prices.;Under section 404 of the;Sarbanes-Oxley Act, auditors are required to;Attest to and report on management's;assessment of internal controls.?;Establish and maintain internal;controls for audited companies.?;Advise management on its preparation;of the Report on Internal Controls.?;Evaluate the company's internal;control system periodically throughout the year.?;All of these.;Which of the following is an;appropriate base to distribute the cost of building depreciation to;responsibility centers?;Number of employees in the;responsibility centers.?;Budgeted sales dollars of the;responsibility centers.?;Square feet occupied by the;responsibility centers.?;Budgeted net income of the;responsibility centers.?;Total budgeted direct operating costs;of the responsibility centers.?


Paper#40866 | Written in 18-Jul-2015

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