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ACCT 5060 Final Exam

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ACCT 5060;Final Exam;Name;1. The four key behavioral considerations in management accounting and control system design include all of the following EXCEPT;a. integrating the organization?s pay scale;b. using a mix of short- and long-term qualitative and quantitative performance measures;c. empowering employees to be involved in decision making and MACS design;d. developing an appropriate incentive system to reward performance;2. Pressures on managers to act unethically include all of the following EXCEPT;a. pressures to act in the long-run best interest of the shareholders;b. solicitations for confidential information;c. requests to falsify reports;d. requests to bias information in favor of certain stakeholders;3. To the extent that an ethical hierarchy exists, _____ have the highest authority.;a. societal norms;b. legal rules;c. organizational norms;d. personal norms;4. When a manager?s and employee?s goals are aligned with organizational goals, it is referred to as;a. a diagnostic control system;b. the intensity factor;c. goal congruence;d. monitoring;5. The roles of performance measurement systems in organizations include all of the following EXCEPT;a. motivate employees to help the organization achieve its strategic objectives;b. help managers with resource allocation;c. create value from intangible assets as well as their physical and financial assets;d. communicate the company?s strategic objectives;6. The Balanced Scorecard is said to be ?balanced? because it measures;a. short-term and long-term objectives;b. financial and nonfinancial objectives;c. internal and external objectives;d. All of the above are correct.;7. The ______________ perspective of the Balanced Scorecard asks, ?At which processes must we excel to satisfy our customers and shareholders??;a. learning and growth;b. customer;c. process;d. shareholder;8. The __________ perspective of the Balanced Scorecard focuses on creating value for customers.;a. Value;b. Financial;c. Stakeholder;d. Customer;9. Measures of employees? skills and capabilities are included in the ________ perspective of the Balanced Scorecard.;a. financial;b. internal;c. customer;d. learning and growth perspective;10. A chain of cause-and-effect relationships that appropriately link the four;balanced scorecard perspectives is;a. a high return on investment causes customer loyalty that results in skilled production workers that improve process quality;b. skilled production workers help to produce process quality that results in customer loyalty that helps to increase return on investment;c. customer loyalty results in a high return on investment that results in the ability to attract skilled production workers that improve process quality;d. improved process quality results in a high return on investment that causes customer loyalty that results in the ability to attract skilled production workers;11. Participative budgeting is an approach to budgeting that;a. is top-down in nature.;b. allows top management to set the budget.;c. discourages budget slack.;d. is more likely to motivate people to work towards the organization's goals t;than a top-down approach.;12. Which of the following is not included in the operating budget?;a. Budgeted balance sheet;b. Sales budget;c. Selling and administrative budget;d. Raw materials purchases budget;13. A primary financial budget is the;a.. Production budget;b. Cash budget;c. Inventory budget;d. Selling and administrative budget;14. Jackel Company produces hand tools. A sales budget for the next four months is as follows: March 10,000 units, April 13,000, May 16,000 and June 21,000. Jackel Company's ending finished goods inventory policy is 10% of the following month's sales. What is budgeted finished goods inventory for May?;a. 1,000;b. 1,300;c. 1,600;d. 2,100;15. In which order are the following developed?;A = Production plan B = Materials purchasing plan;C = Demand forecast D = Sales plan;a. first to last: A, B, C, D;b. first to last: C, D, A, B;c. first to last: D, C, B, A;d. first to last: C, A, D, B;THE FOLLOWING INFORMATION APPLIES TO QUESTIONS 16 -18.;For the next six months, Berry Company projects the following information (in;units).;July Aug. Sept. Oct. Nov. Dec.;Retail demand 100 100 150 150 200 200;Dealer demand 200 250 300 350 400 450;Shop capacity 500 500 500 500 500 500;Painting capacity 350 350 350 600 600 600;Demand drives production for that month and cannot be carried over from one month to another. Retail customers are satisfied first.;16. The production for July is projected to be;a. 100 units;b. 300 units;c. 350 units;d. 500 units;17. The number of dealer units that will be produced and sold in September is;a. 300 units;b. 350 units;c. 500 units;d. 200 units;18. Painting capacity appears to be;a. short-term capacity;b. intermediate-term capacity;c. long-term capacity;d. total demand;THE FOLLOWING INFORMATION APPLIES TO QUESTIONS 19 -21;The following information for the second quarter of 2006 pertains to Huffman Company;Month Sales Purchases;April $45,000 $24,000;May $60,000 $30,000;June $75,000 $42,000;? Cash is collected from customers in the following manner;Month of sale 30%;Month following the sale 70%;? 40% of purchases are paid for in cash in the month of purchase, and the balance is paid the following month.;? Labor costs are 20% of sales. Other operating costs are $22,500 per month (including $6,000 of depreciation). Both of these are paid in the month incurred.;? The cash balance on June 1 is $6,000. A minimum cash balance of $4,500 is required at the end of the month. Money can be borrowed in multiples of $1,500.;* No loans outstanding on June 1.;19. How much cash will be collected from customers in June?;a. $64,500;b. $70,500;c. $75,000;d. None of the above is correct.;20. How much cash will be paid to suppliers in June?;a. $34,800;b. $28,000;c. $44,000;d. None of the above is correct.;21. How much cash will be disbursed for labor and operating costs in June?;a. $31,500;b. $35,000;c. $44,200;d. $48,200;22. In __________, as one budget period passes, planners delete that budget period from the master budget and add another one.;a. zero-based budgeting;b. periodic budgeting;c. incremental budgeting;d. continuous budgeting;THE FOLLOWING INFORMATION APPLIES TO QUESTIONS 23 ? 25.;Community Manufacturing Inc., developed the following standard costs for direct material and direct labor for one of their major products, the 30-gallon heavy-duty plastic container.;Standard quantity Standard price;Direct materials 0.20 pounds $25 per pound;Direct labor 0.10 hours $15 per hour;During May, Community produced and sold 10,000 containers using 2,200 pounds of direct materials at an average cost per pound of $24 and 1,050 direct labor hours at an average wage of $14.75 per hour.;23. May?s direct material price variance was;a. $2,800 favorable;b. $2,200 favorable;c. $5,000 unfavorable;d. None of the above is correct.;24. May?s direct material quantity variance was;a. $2,800 unfavorable;b. $2,200 favorable;c. $5,000 unfavorable;d. None of the above is correct.;25. May?s direct labor rate variance was;a. $750.00 unfavorable;b. $262.50 favorable;c. $487.50 favorable;d. indeterminable using the above information;26. Which of the following methods is calculated as annual net income as a percentage of the original investment in assets?;a. Accounting rate of return;b. Payback period;c. Net present value;d. Internal rate of return;27. Sorius Corp is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in net cash flows of $100,000. The equipment will have an initial cost of $400,000 and have a 5 year life. If the salvage value of the equipment is estimated to be $75,000, what is the annual net income? Ignore income taxes.;a. $25,000;b. $35,000;c. $165,000;d. $175,000;28. Peet's Corp is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in cash flow of $100,000. The equipment will have an initial cost of $400,000 and have a 5 year life. If the salvage value of the equipment is estimated to be $75,000, what is the payback period? Ignore income taxes.;a. 3.25 years;b. 4.00 years;c. 4.75 years;d. 7.00 years;29. Marchand Corp is considering the purchase of a new piece of equipment, which would have an initial cost of $500,000, a 7 year life, and $150,000 salvage value. The increase in cash flow each year of the equipment's life would be as follows;What is the payback period?;a. 5.51 years;b. 5.97 years;c. 6.00 years;d. 6.18 years;30. The idea that the value of money changes over time because it can be invested to earn interest is the;a. net present value of money.;b. accounting value of money.;c. time value of money.;d. investment value of money.;31. When making screening decisions using the net present value method, a project is acceptable if;a. the NPV is greater than the hurdle rate.;b. the NPV is greater than the IRR.;c. the NPV is positive.;d. the NPV is negative.;32. Minne Corp is considering the purchase of a new piece of equipment. When discounted at a hurdle rate of 8%, the project has a net present value of $24,580. When discounted at a hurdle rate of 10%, the project has a net present value of ($28,940). The internal rate of return of the project is;a. zero.;b. between zero and 8%.;c. between 8% and 10%.;d. greater than 10%.;33. An analysis that reveals whether changing the underlying assumptions would affect the decision is a;a. net present value analysis.;b. internal rate of return analysis.;c. payback period analysis.;d. sensitivity analysis;34. Jonas Inc. is considering whether to lease or purchase a piece of equipment. The total cost to lease the equipment will be $120,000 over its estimated life, while the total cost to buy the equipment will be $75,000 over its estimated life. At Jonas's required rate of return, the net present value of the cost of leasing the equipment is $73,700 and the net present value of the cost of buying the equipment is $68,000. Based on financial factors, Jonas should;a. lease the equipment, saving $45,000 over buying.;b. buy the equipment, saving $45,000 over leasing.;c. lease the equipment, saving $5,700 over buying.;d. buy the equipment, saving $5,700 over leasing.;35. In a decentralized organization;a. local-division managers must receive higher approval for most business decisions;b. company-wide standard operating procedures are common;c. local-division managers have an opportunity to gain decision-making experience;d. decisions are made by senior executives;36. All of the following are true of responsibility centers EXCEPT that they;a. operate like a small business;b. promote the interests of the larger organization;c. coordinate activities with other responsibility centers;d. are best used in a centralized organization;37. Segment margin includes;a. all costs traceable to the segment;b. the segment?s share of allocated corporate costs;c. the segment?s share of allocated unavoidable costs;d. All of the above are correct.;38 The primary goal of transfer pricing is to;a. motivate the decision maker to act in the organization?s best interests;b. obtain a high transfer price for the supplying unit;c. obtain a high transfer price for the receiving unit;d. agree on a price for external sales;39. Return on investment (ROI) can be increased by;a. increasing sales;b. decreasing operating assets;c. decreasing operating income;d. decreasing asset turnover;40. Randall Company makes and distributes outdoor play equipment. Last year sales were $2,400,000, operating income was $600,000, and the assets used were $3,000,000.The return on investment (ROI) is;a. 20%;b. 80%;c. 25%;d. 125%

 

Paper#79831 | Written in 18-Jul-2015

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