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ACC 561 Final Exam




1) The statement of cash flows is used for _____.;A. showing the relationship of net income to changes in current assets;B. determining a company?s acceptable level of debt financing;C. revealing commitments that may restrict future courses of action;D. evaluating the creditworthiness of the organization;2) Nonoperating items on the income statement _____.;A. are revenues and expenses arising from adjusting entries;B. include interest income and expense;C. appear only on corporate income statements;D. appear on the income statement immediately after gross profit;3) The difference between a single-step and multiple-step income statement is that a single-step income statement _____.;A. groups all revenues together and all expenses together, whereas a multiple-step income statement separates certain revenues and expenses from each other and presents subtotals;B. calculates net income using one method, whereas a multiple-step income statement calculates net income using two or more methods;C. calculates gross profit and operating income, whereas a multiple-step income statement does not;D. shows only 1 year's net income, whereas a multiple-step income statement shows multiple years' net income;4) Which one of the following statements is true?;A. The statement of cash flows reports the cash receipts but not cash payments of an entity over a period of time.;B. Both the statement of cash flows and the income statement determine the net income for a company.;C. Transactions affecting the sale and the purchase or production of goods and services are reported in the financing activities section of the statement of cash flows.;D. Investing activities in the statement of cash flows include acquiring and selling long-term assets.;5) The _____ accounting convention uses the acquisition cost minus depreciation in valuing an asset on the balance sheet.;A. continuity;B. conservatism;C. cost-benefit;D. materiality;6) A new corporation issuing a common, no-par value stock for cash would include a journal entry a debit to _____.;A. paid-in capital and a credit to retained earnings.;B. cash and a credit to common stock.;C. retained earnings and a credit to cash.;D. cash and a credit to retained income.;7) Which type of organization would most likely have work-in-process inventory?;A. A retail store;B. A manufacturing company;C. A service organization;D. A real-estate investment trust;8) _____ is a measure of income or profit divided by the investment required to obtain that income or profit.;A. Return on sales;B. Capital turnover;C. Return on investment;D. Residual income;9) The following information is available for the Peter Company;Sales: $150,000;Invested capital: $156,250;ROI: 10%;The return on sales is _____.;A. 10.00%;B. 10.42%;C. 62.50%;D. 9.60%;10) The following information is available for the Peter Company;Sales: $500,000;Invested capital: $312,500;ROI: 10%;The return on sales is _____.;A. 10.00%;B. 6.250%;C. 1.000%;D. 62.50%;11) Company A?s revenues are $300 on invested capital of $240. Expenses are currently 70% of sales. If Angelo Company can reduce its capital investment by 20% in Company A, return on investment will be _____.;A. 75%;B. 93.75%;C. 18.75%;D. 46.88%;12) When the variable costing method is used, fixed factory overhead appears on the income statement as a _____.;A. component of cost of goods sold;B. fixed expense;C. production-volume variance;D. component of gross profit;13) In absorption costing, costs are separated into the major categories of _____.;A. manufacturing and nonmanufacturing;B. manufacturing and fixed;C. fixed and variable;D. variable and nonmanufacturing;14) _____ is another term for variable costing.;A. Full costing;B. Direct costing;C. Traditional costing;D. Absorption costing;15) Budgeted service department cost rates protects the user departments from _____.;A. service department efficiencies;B. price fluctuations;C. service outages;D. employee control;16) _____ is an example of the external financial-reporting purpose of the cost management systems.;A. The cost of a manufacturing process;B. The product mix to optimize profitability;C. The amount of inventory that should appear on the balance sheet;D. Budget reporting;17) The level of sales at which revenues equal expenses and net income is zero is called the _____.;A. margin of safety;B. contribution margin;C. break-even point;D. marginal income point;18) Output measures of both resources and activities are _____.;A. cost drivers;B. stages of production;C. fixed activities;D. variable activities;19) The break-even point is where _____.;A. total sales revenue equals total cost plus desired profit.;B. the contribution margin equals net income plus fixed costs.;C. total sales revenue equals total cost.;D. the variable cost equals total cost.;20) _____ budgeting is when budgets are formulated with the active participation of all affected employees.;A. Financial;B. Team;C. Participative;D. Shared;21) _____ is the logical integration of management accounting tools to gather and report data and to evaluate performance.;A. An internal control system;B. A quality control system;C. A financial-reporting system;D. A management control system;22) _____ are components of a master budget.;A. A strategic plan and an operating budget;B. An operating budget and a capital budget;C. A continuous budget and a static budget;D. A cash budget and an activity budget;23) An important factor considered by sales forecasters is _____.;A. production employee requirements.;B. expectations of the board of directors.;C. competitors? activities.;D. the desired level of sales.;24) _____ models are mathematical models of the master budget that can react to any set of assumptions about sales, costs, and product mix.;A. Variance analysis;B. Financial planning;C. Accounting;D. Futuring;25) Which of the following is an objective of budgeting?;A. Budgeting provides benchmarks against which performance can be measured.;B. Budgeting provides a fixed fiscal plan that should not be changed during the year.;C. Budgeting helps managers build favorable variances into the performance-evaluation process.;D. Budgeting is done exclusively by the chief fiscal officer for control purposes.;26) An organization's budget program should be used;A. to have power over employees.;B. to assign blame to managers that do not meet budgetary goals.;C. to help managers plan and control the organization?s performance.;D. to help the chief fiscal officer to allocate resources to the favored projects of the executives.;27) The activity-based costing may reveal _________, whereas traditional costing cannot.;A. high-volume products are overcosted;B. low-volume products are overcosted;C. both high- and low-volume products are overcosted;D. both high- and low-volume products are undercosted;28) _____ is a method of approximating cost functions.;A. Cost-driver analysis;B. Transaction analysis;C. Product analysis;D. Account analysis;29) In relation to a cost function, the term reliability refers to _____.;A. whether the costs and activities can be easily observed;B. whether the cost function conforms to a given mathematical model;C. how well the cost function predicts future costs;D. how well the cost function explains past cost behavior;30) One of the simplest methods to measure a linear cost function from past data is the _____.;A. regression analysis method;B. high?low method;C. least squares regression method;D. visual-fit method


Paper#74018 | Written in 18-Jul-2015

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