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Accounting Multiple Choice Questions




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repairs.?;Out-of-court liability settlements.?;The provisions of section 302 of the Sarbanes-Oxley Act (as originally enacted) require the signing officers of a company to do all of the following except;Audit the internal controls over financial reporting.?;Establish the internal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#80303 | Written in 18-Jul-2015

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