Business Accounting
Exam Solutions
Course Introduction
Business Accounting introduces students to the fundamental principles and practices of accounting used in the business environment. The course covers essential topics such as the accounting cycle, financial statements, double-entry bookkeeping, accrual accounting, and the analysis and interpretation of financial information. Students will gain practical skills in recording transactions, preparing financial reports, and understanding the roles of accounting in decision-making processes. Emphasis is placed on the ethical standards of the accounting profession and the relevance of accounting information for internal and external stakeholders. By the end of the course, students will be able to apply basic accounting concepts to real-world business scenarios and evaluate the financial health of an organization.
Recommended Textbook
Managerial Accounting v. 2.1 by Kurt Heisinger and Joe Hoyle
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13 Chapters
876 Verified Questions
876 Flashcards
Source URL: https://quizplus.com/study-set/3576
Page 2
Chapter 1: What Is Managerial Accounting
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75 Verified Questions
75 Flashcards
Source URL: https://quizplus.com/quiz/71029
Sample Questions
Q1) Which of the following costs would not be included in manufacturing overhead?
A)Depreciation of factory building.
B)Direct labor.
C)Indirect labor.
D)Indirect materials.
E)None of the above.
Answer: B
Q2) Regardless of size,all companies have a chief financial officer (CFO)and a treasurer.
A)True
B)False
Answer: False
Q3) All organizations must have:
A)a tax accountant.
B)a treasurer.
C)vice president of marketing.
D)an internal auditor.
E)None of the above.
Answer: E
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3
Chapter 2: How Is Job Costing Used to Track Production Costs
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44 Verified Questions
44 Flashcards
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Sample Questions
Q1) When a manufacturing company purchases raw materials,the Raw Materials Inventory account is debited.
A)True
B)False
Answer: True
Q2) The overhead costs applied to jobs using a predetermined overhead rate are recorded by debiting Work in Process Inventory and crediting Manufacturing Overhead.
A)True
B)False Answer: True
Q3) Normal costing is preferred by most companies because it assigns actual overhead costs to jobs.
A)True
B)False
Answer: False
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Chapter 3: How Does an Organization Use Activity-Based
Costing to Allocate Overhead Costs
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70 Verified Questions
70 Flashcards
Source URL: https://quizplus.com/quiz/71027
Sample Questions
Q1) Which of the following would be the best allocation base for a product designed for a specific customer?
A)Quantity of materials used.
B)Hours of design time.
C)Square feet of space occupied.
D)Number of new products.
E)None of the answer choices is correct.
Answer: B
Q2) Overhead activities that are required to sustain facility operations are called unit-level activities.
A)True
B)False
Answer: False
Q3) Step one of an activity-based costing (ABC)system is to:
A)identify costly production activities.
B)calculate a predetermined overhead rate.
C)identify activity cost pools.
D)identify cost drivers.
E)allocate overhead costs to products.
Answer: A
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Chapter 4: How Is Process Costing Used to Track
Production Costs
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58 Verified Questions
58 Flashcards
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Sample Questions
Q1) The Packaging Department at Vail Incorporated had 51,000 units in beginning inventory.These units contained $105,000 in direct materials,$120,000 in direct labor,and $90,000 in overhead.During the period,the department incurred costs of $480,000 in direct materials,$600,000 in direct labor and $300,000 in overhead and started 240,000 units.Ending inventory consisted of 18,000 units which were 100% complete with respect to direct materials and 70% complete with respect to direct labor and overhead.How many units were transferred out?
A)309,000
B)291,000
C)282,000
D)273,000
E)None of the answer choices is correct.
Q2) If 10 physical units of product are 30 percent complete at the end of the period,an equivalent of 3 completed units will be used for process costing calculations.
A)True B)False
Q3) A job costing system would be appropriate for an oil refinery.
A)True B)False
Page 6
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Chapter 5: How Do Organizations Identify Cost Behavior
Patterns
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68 Verified Questions
68 Flashcards
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Sample Questions
Q1) Refer to Exhibit 5-2.What are the estimated total costs if Manchester expects to sell 2,100 computers next year?
A)$439,500
B)$523,000
C)$460,000
D)$449,500
E)None of the answer choices is correct.
Q2) Refer to Exhibit 5-7.Which of the following amounts represents total cost of goods sold?
A)$176,000
B)$126,000
C)$164,000
D)$424,000
E)None of the answer choices is correct.
Q3) If a firm's activity expands beyond its relevant range,only fixed costs must be reevaluated.
A)True B)False
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Chapter 6: How Is Cost-Volume-Profit Analysis Used for Decision Making
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79 Verified Questions
79 Flashcards
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Sample Questions
Q1) Refer to Exhibit 6-4.Assume the sales mix remains the same at all levels of sales. How many units of each product must be sold to earn a monthly profit of $504,000?
A)Plane 34,618 units;Boat 8,655 units
B)Plane 15,232 units;Boat 3,808 units
C)Plane 30,464 units;Boat 7,616 units
D)Plane 27,200 units;Boat 6,800 units
E)None of the answer choices is correct.
Q2) Refer to Exhibit 6-4.Assume the sales mix remains the same at all levels of sales. How many units in total must be sold to break even?
A)25,000
B)28,000
C)14,000
D)70,000
E)None of the answer choices is correct.
Q3) A decrease in variable costs will reduce the margin of safety.
A)True
B)False
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Page 8
Chapter 7: How Are Relevant Revenues and Costs Used to
Make Decisions
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76 Verified Questions
76 Flashcards
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Sample Questions
Q1) Davis Company has $20 per unit in variable costs and $800,000 per year in fixed costs.Demand is estimated to be 400,000 units per year.What is the desired price per unit if a markup of 30% on total cost is used to determine the price?
A)$26.00
B)$37.40
C)$28.60
D)$34.00
E)None of the answer choices is correct.
Q2) All managers require one standard format for differential analysis.
A)True
B)False
Q3) Refer to Exhibit 7-4.If allocated fixed costs are based on sales revenue for each product line as a proportion of total sales revenue,what is the profit or (loss)for Plain?
A)($9,000)
B)$6,000
C)$1,500
D)($16,500)
E)None of the answer choices is correct.
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Chapter 8: How Is Capital Budgeting Used to Make Decisions
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72 Verified Questions
72 Flashcards
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Sample Questions
Q1) Managers often rank investment opportunities by internal rate of return. A)True
B)False
Q2) A firm would never choose to accept a long-term investment proposal if the net present value is below zero.
A)True
B)False
Q3) The hurdle rate used to evaluate an investment is also called the discount rate. A)True
B)False
Q4) Incentive systems that pay managers for short-term results may keep them from accepting long-term proposals with a positive net present value.
A)True
B)False
Q5) Cash flows that are not adjusted for inflation will likely underestimate future cash flows,thereby underestimating the net present value of the investment opportunity. A)True
B)False
10
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Chapter 9: How Are Operating Budgets Created
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68 Verified Questions
68 Flashcards
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Sample Questions
Q1) Which of the following best describes the selling and administrative budget?
A)A series of budget schedules outlining the organization's plans for the upcoming period.
B)An estimate of cash expenditures for long-term assets.
C)An estimate of all operating costs other than production costs.
D)A budget that is based on sales projections plus an estimate of desired ending finished goods inventory less beginning finished goods inventory.
E)None of the answer choices is correct.
Q2) Refer to Exhibit 9-2.What will accounts receivable be at the end of February?
A)$450,000
B)$1,500,000
C)$1,050,000
D)$375,000
E)None of the answer choices is correct.
Q3) All of the following appear on the manufacturing overhead budget except:
A)total fixed overhead costs.
B)indirect materials cost per unit.
C)indirect labor cost per unit.
D)direct labor rate per hour.
E)None of the answer choices is correct.
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Chapter 10: How Do Managers Evaluate Performance Using Cost Variance Analysis
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69 Verified Questions
69 Flashcards
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Sample Questions
Q1) Standard costs are used to establish the flexible budget for direct labor. A)True
B)False
Q2) Refer to Exhibit 10-5.What is the variable overhead spending variance for the purchase order activity?
A)$2,000 favorable
B)$2,000 unfavorable
C)$8,000 favorable
D)$8,000 unfavorable
E)None of the answer choices is correct.
Q3) There is no efficiency variance for fixed manufacturing overhead since,by definition,fixed costs do not change with changes in the activity base.
A)True
B)False
Q4) The variable overhead efficiency variance is the difference between the actual hours worked at the actual rate and the standard hours worked at standard rate. A)True
B)False
Page 12
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Chapter 11: How Do Managers Evaluate Performance in
Decentralized Organizations
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63 Verified Questions
63 Flashcards
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Sample Questions
Q1) If decisions within a company are made by top management at headquarters,which of the following terms best describes this company?
A)cost center.
B)decentralized organization.
C)centralized organization.
D)investment center.
E)None of the answer choices is correct.
Q2) Refer to Exhibit 11-1.Assume the Trikes Division has average operating assets totaling $400,000 for the year.What is the division's return on investment?
A)19.2%
B)40.0%
C)90.0%
D)24.0%
E)None of the answer choices is correct.
Q3) An investment center is an organizational segment in which the manager is responsible for costs,revenues,and investment in assets.
A)True
B)False
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Chapter 12: How Is the Statement of Cash Flows Prepared and Used
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65 Verified Questions
65 Flashcards
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Sample Questions
Q1) Operating cash flow ratios are always greater than 1.0.
A)True
B)False
Q2) When using the indirect method for the statement of cash flows,depreciation expense is added to net income to obtain cash provided by operating activities.
A)True
B)False
Q3) The beginning and ending balances of long-term debt for the most recent fiscal year are $43,850 and $27,000,respectively.During the year,cash payments for long-term debt amounted to $23,450.How much new long-term debt was issued during the year?
A)$6,600
B)$20,400
C)$3,550
D)$16,850
E)None of the answer choices is correct.
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Chapter 13: How Do Managers Use Financial and
Nonfinancial Performance Measures
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62 Verified Questions
62 Flashcards
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Sample Questions
Q1) Declan Inc.calculated its accounts receivable turnover for 2017 to be 20.0.Both years prior to 2017 showed accounts receivable turnovers to be 12.0.Based on this information,what is the best explanation for the change?
A)The company had fewer accounts receivable in 2017 than the prior two years.
B)The company had more sales in 2017 than in the prior two years.
C)The company had fewer sales in 2017 than in the prior two years.
D)The company took longer to collect their accounts receivable in 2017 than the prior two years.
E)None of the answer choices is correct.
Q2) In general,managers prefer expenses as a percent of net sales to increase over time.
A)True
B)False
Q3) The price-earnings ratio measures the premium investors are willing to pay for a company's stock relative to its earnings.
A)True
B)False
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