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Corporate Financial and Managerial accounting Final Part 1 Theory




1. Which one of the following characteristics would likely be associated with a just-in-time inventory method? (Points: 1);Ending inventory of work in process that would allow several production runs;A backlog of inventory orders not yet shipped;Minimal finished goods inventory on hand;An understanding with customers that they may come to the showroom and select from inventory on hand;2. Manufacturing costs include (Points: 1) direct materials and direct labor only.;direct materials and manufacturing overhead only.;direct labor and manufacturing overhead only.;direct materials, direct labor, and manufacturing overhead.;Question 3. 3. Sales commissions are classified as (Points: 1) overhead costs;period costs.;product costs.;indirect labor.;Question 4. 4. On the costs of goods manufactured schedule, the item raw materials inventory (ending) appears as a(n) (Points: 1) addition to raw materials purchases.;addition to raw materials available for use.;subtraction from raw materials available for use.;subtraction from raw materials purchases.;Question 5. 5. The reporting standard for external financial reports is (Points: 1) industry-specific.;company-specific.;generally accepted accounting principles.;department-specific.;Question 6. 6. An important feature of a job order cost system is that each job (Points: 1) must be similar to previous jobs completed.;has its own distinguishing characteristics.;must be completed before a new job is accepted.;consists of one unit of output.;Question 7. 7. Factory labor costs (Points: 1) are accumulated in a control account.;do not include pension costs.;include vacation pay.;are based on workers? net pay.;Question 8. 8. If manufacturing overhead has been overapplied during the year, the adjusting entry at the end of the year will show a (Points: 1) debit to Manufacturing Overhead.;credit to Finished Goods Inventory;debit to Cost of Goods Sold.;credit to Work in Process Inventory.;Question 9. 9. In computing equivalent units, ___________ is not part of the equivalent units of production formula. (Points: 1) units transferred out;beginning work in process;ending work in process;None of these is correct.;Question 10. 10. A production cost report (Points: 1) is prepared for each product.;is prepared from a job cost sheet.;will show quantity and cost data for a production department.;will not identify a specific department if more than one department is involved in the production process.;Question 11. 11. Differences between a job order cost system and a process cost system include all of the following except the (Points: 1) documents used to track costs.;point at which costs are totaled.;unit cost computations.;flow of costs.;Question 12. 12. Which would be an appropriate cost driver for the ordering activity? (Points: 1) Machine setups.;Purchase orders.;Machine hours.;Inspections.;Question 13. 13. Fixed costs normally will not include (Points: 1) property taxes.;direct labor.;supervisory salaries.;depreciation on buildings and equipment.;Question 14. 14. In CVP analysis, the term "cost" (Points: 1) includes only manufacturing costs.;means cost of goods sold.;includes manufacturing costs plus selling and administrative expenses.;excludes all fixed manufacturing costs.;Question 15. 15. The break-even point cannot be determined by (Points: 1) computing it from a mathematical equation.;computing it using contribution margin.;reading the prior year's financial statements.;deriving it from a CVP graph.;Question 16. 16. The CVP income statement (Points: 1) is distributed internally and externally.;classifies costs by functions.;discloses contribution margin in the body of the statement.;will reflect a different net income than the traditional income statement.;Question 17. 17. Which of the following is not a financial budget? (Points: 1) Capital expenditure budget;Cash budget;Manufacturing overhead budget;Budgeted balance sheet;Question 18. 18. In a production budget, total required units are the budgeted sales units plus (Points: 1) beginning finished goods units.;desired ending finished goods units.;desired ending finished goods units plus beginning finished goods units.;desired ending finished goods units minus beginning finished goods units.;Question 19. 19. Which one of the following sections would not appear on a cash budget? (Points: 1) Cash receipts;Financing;Investing;Cash disbursements;Question 20. 20. Which one of the following budgets would be prepared for a manufacturer but not for a merchandiser? (Points: 1) Direct labor budget;Cash budget;Sales budget;Budgeted income statement;Question 21. 21. A flexible budget (Points: 1) is prepared when management cannot agree on objectives for the company.;projects budget data for various levels of activity.;is only useful in controlling fixed costs.;cannot be used for evaluation purposes because budgeted data are adjusted to reflect actual results.;Question 22. 22. The accumulation of accounting data on the basis of the individual manager who has the authority to make day-to-day decisions about activities in an area is called (Points: 1) static reporting.;flexible accounting.;responsibility accounting.;master budgeting.;Question 23. 23. A measure frequently used to evaluate the performance of the manager of an investment center is (Points: 1) the amount of profit generated.;the rate of return on funds invested in the center.;the percentage increase in profit over the previous year.;departmental gross profit.;Question 24. 24. All of the following statements are correct about management by exception except it (Points: 1) enables top management to focus on problem areas that need attention.;means that management has to investigate every budget difference.;requires that there must be some guidelines for identifying an exception.;means that top management's review of a budget report is focused primarily on differences between actual results and planned objectives.;Question 25. 25. The cost of freight-in (Points: 1) is to be included in the standard cost of direct materials.;is considered a selling expense.;should have a separate standard apart from direct materials.;should not be included in a standard cost system.;Question 26. 26. The investigation of materials price variance usually begins in the (Points: 1) first production department.;purchasing department.;controller's office.;accounts payable department.;Question 27. 27. If the standard hours allowed are less than the standard hours at normal capacity, the volume variance (Points: 1) cannot be calculated.;will be favorable.;will be unfavorable.;will be greater than the controllable variance.;Question 28. 28. In incremental analysis, (Points: 1) only costs are analyzed.;only revenues are analyzed.;both costs and revenues may be analyzed.;both costs and revenues that stay the same between alternate courses of action will be analyzed.;Question 29. 29. Which decision will involve no incremental revenues? (Points: 1) Make or buy decision;Drop a product line;Accept a special order;Additional processing decision;Question 30. 30. Capital budgeting is the process (Points: 1) used in sell or process further decisions.;of determining how much capital stock to issue.;of making capital expenditure decisions.;of eliminating unprofitable product lines.


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