Financial Accounting
Exam Solutions
Course Introduction
Financial Accounting introduces students to the fundamental principles and concepts used in the process of recording, summarizing, and reporting financial transactions of businesses. The course covers the preparation and interpretation of key financial statements, including the balance sheet, income statement, and cash flow statement, with an emphasis on understanding how these documents assist stakeholders in making informed economic decisions. Through the study of generally accepted accounting principles (GAAP), students will develop skills in analyzing financial data, applying accounting cycles, and ensuring ethical financial reporting. By the end of the course, students will possess a solid foundation in accounting practices applicable to a wide range of industries and organizational settings.
Recommended Textbook
Principles of Accounting 11th Edition by Belverd E. Needles
Available Study Resources on Quizplus
28 Chapters
4320 Verified Questions
4320 Flashcards
Source URL: https://quizplus.com/study-set/3728 Page 2
Chapter 1: Uses of Accounting Information and the Financial Statements
Available Study Resources on Quizplus for this Chatper
167 Verified Questions
167 Flashcards
Source URL: https://quizplus.com/quiz/74365
Sample Questions
Q1) The authoritative body currently responsible for establishing accounting practice is the
A) Internal Revenue Service.
B) Financial Accounting Standards Board.
C) American Institute of Certified Public Accountants.
D) Federal Reserve Board.
Answer: B
Q2) The purpose of an audit is to
A) determine whether or not a company is a good investment.
B) comply with income tax regulations.
C) determine whether or not a company is a good credit risk.
D) ascertain that the financial statements follow GAAP.
Answer: D
Q3) Corporations represent the largest number of businesses in the United States.
A)True
B)False
Answer: False
To view all questions and flashcards with answers, click on the resource link above.
Page 3
Chapter 2: Analyzing Business Transactions
Available Study Resources on Quizplus for this Chatper
189 Verified Questions
189 Flashcards
Source URL: https://quizplus.com/quiz/74364
Sample Questions
Q1) When a company receives an electric bill but does not pay it right away, what is the required journal entry to be recorded?
A) Utilities Expense - Debit; Accounts Receivable - Credit
B) No entry is required until the bill is paid.
C) Utilities Expense - Debit; Accounts Payable - Credit
D) Accounts Payable - Debit; Utilities Expense - Credit
Answer: C
Q2) To find an explanation of a transaction, one should look at the A) ledger.
B) trial balance.
C) journal.
D) chart of accounts.
Answer: C
Q3) Which of the following transactions decreases both assets and owner's equity?
A) Withdrawal of cash by the owner
B) Advance payment made for insurance
C) Receipt of a phone bill, to be paid at a later time
D) Payment of a liability
Answer: A
To view all questions and flashcards with answers, click on the resource link above.
Page 4
Chapter 3: Measuring Business Income
Available Study Resources on Quizplus for this Chatper
171 Verified Questions
171 Flashcards
Source URL: https://quizplus.com/quiz/74363
Sample Questions
Q1) Expenses are incurred
A) to generate revenue.
B) to produce liabilities.
C) only during the adjustment process.
D) to produce assets.
Answer: A
Q2) Equipment might be depreciated over 15 years because
A) it will lose most of its market value in 15 years.
B) it will be paid for in 15 years.
C) it will help to generate revenue for the company over 15 years.
D) income tax provisions require depreciation over 15 years.
Answer: C
Q3) Adjusting entries affect cash flows in the current period.
A)True
B)False
Answer: False
Q4) When expenses exceed revenues, a net income has occurred.
A)True
B)False
Answer: False
To view all questions and flashcards with answers, click on the resource link above. Page 5
Chapter 4: Completing the Accounting Cycle
Available Study Resources on Quizplus for this Chatper
176 Verified Questions
176 Flashcards
Source URL: https://quizplus.com/quiz/74362
Sample Questions
Q1) The adjusting entries involving Depreciation Expense-Buildings and Supplies Expense could be reversed.
A)True
B)False
Q2) Owner's Capital is closed by transferring the balance to Income Summary.
A)True
B)False
Q3) An amount for owner's Capital would not appear in which of the following work sheet columns?
A) Income Statement
B) Balance Sheet
C) Trial Balance
D) Adjusted Trial Balance
Q4) Which work sheet columns should contain "key letters"?
A) Balance Sheet
B) Adjusted Trial Balance
C) Trial Balance
D) Adjustments
Q5) Why will the Income Summary account never appear on any financial statement?
Q6) What does the preparation of reversing entries accomplish?
To view all questions and flashcards with answers, click on the resource link above. Page 6
Chapter 5: Financial Reporting and Analysis
Available Study Resources on Quizplus for this Chatper
177 Verified Questions
177 Flashcards
Source URL: https://quizplus.com/quiz/74361
Sample Questions
Q1) The matching rule precludes the cost of inventory from being expensed until the inventory has been sold.
A)True
B)False
Q2) The asset turnover ratio measures
A) how quickly the company uses assets to pay debt.
B) how efficiently assets are used to produce sales.
C) the income produced by selling inventory.
D) how efficiently equity is used to produce revenue.
Q3) Which of the following accounts is most likely to appear on the balance sheet as a current liability?
A) Accumulated Depreciation
B) Bonds Payable
C) Mortgage Payable
D) Wages Payable
Q4) General-purpose external financial statements that are divided into subcategories are called classified financial statements.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 7
Chapter 6: The Operating Cycle and Merchandising Operations
Available Study Resources on Quizplus for this Chatper
145 Verified Questions
145 Flashcards
Source URL: https://quizplus.com/quiz/74360
Sample Questions
Q1) Taking a physical inventory refers to making a count of all merchandise on hand at a particular time.
A)True
B)False
Q2) On the income statement, freight-out is included as part of cost of goods sold.
A)True
B)False
Q3) Which of the following activities is not a component of the operating cycle?
A) Payment of employees' wages
B) Sale of merchandise
C) Purchase of merchandise
D) Collection of cash from merchandise sales
Q4) If it takes 30 days to sell inventory, 60 days to collect for the sale, and creditors' terms are 10 days, the financing period is 100 days.
A)True
B)False
Q5) Under a perpetual inventory system, is it necessary to take a physical inventory at the end of the period? Why or why not?
8
To view all questions and flashcards with answers, click on the resource link above.
Chapter 7: Internal Control
Available Study Resources on Quizplus for this Chatper
117 Verified Questions
117 Flashcards
Source URL: https://quizplus.com/quiz/74359
Sample Questions
Q1) In a small business, because it is often cost-prohibitive to hire extra employees, the lack of certain separations of duties can best be overcome by
A) bonding the employees.
B) getting the owner actively involved.
C) hiring only honest employees.
D) holding one person responsible for a given set of transactions.
Q2) The separation of duties feature of internal control can be negated when several employees are involved in a scheme.
A)True
B)False
Q3) Which of the following would not be found in a good system of internal control?
A) Requiring all employees to take earned vacations
B) Establishing a system of checks and balances
C) Having one person handle all the responsibilities of a department
D) Establishing an internal audit staff
Q4) Good internal control dictates that each employee should oversee only part of a transaction.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: Inventories
Available Study Resources on Quizplus for this Chatper
154 Verified Questions
154 Flashcards
Source URL: https://quizplus.com/quiz/74358
Sample Questions
Q1) An understatement of ending inventory in one period results in
A) an overstatement of the ending inventory of the next period.
B) an understatement of gross margin of the next period.
C) an overstatement of gross margin of the next period.
D) no effect on gross margin of the next period.
Q2) The LIFO method tends to smooth out the peaks and valleys of a business cycle.
A)True
B)False
Q3) A major criticism of the FIFO method is that it magnifies the effects of the business cycle on business income.
A)True
B)False
Q4) A retail company has goods available for sale of $500,000 at retail and $200,000 at cost and ending inventory of $57,000 at retail. What is the estimated cost of goods sold?
A) $143,000
B) $188,600
C) $177,200
D) $165,800
Q5) What is the chief objective of supply-chain management? How is it accomplished?
To view all questions and flashcards with answers, click on the resource link above. Page 10
Chapter 9: Cash and Receivables
Available Study Resources on Quizplus for this Chatper
177 Verified Questions
177 Flashcards
Source URL: https://quizplus.com/quiz/74357
Sample Questions
Q1) On a bank reconciliation, outstanding checks are deducted from the balance per books.
A)True
B)False
Q2) The SEC requires companies to disclose the amount of compensating balances in a note to the financial statements.
A)True
B)False
Q3) The general ledger account for Accounts Receivable shows a debit balance of $25,000. Allowance for Uncollectible Accounts has a credit balance of $1,500. Net sales for the year were $250,000. In the past, 3 percent of sales have proved uncollectible, and an aging of accounts receivable resulted in an estimate of $10,000 of uncollectible accounts receivable. Using the percentage of net sales method, the Allowance for Uncollectible Accounts balance (after adjustment) would be
A) $7,500.
B) $10,000.
C) $9,000.
D) $6,000.
Q4) On a balance sheet, what items normally are included in Cash?
To view all questions and flashcards with answers, click on the resource link above. Page 11
Chapter 10: Current Liabilities and Fair Value Accounting
Available Study Resources on Quizplus for this Chatper
180 Verified Questions
180 Flashcards
Source URL: https://quizplus.com/quiz/74356
Sample Questions
Q1) If the amount of a liability cannot be exactly determined, it should not be recorded.
A)True
B)False
Q2) In a deferred payment arrangement, interest is charged only if it is stated.
A)True
B)False
Q3) The annual interest earned on an amount deposited into a bank account will increase each year when simple interest is used.
A)True
B)False
Q4) Under what circumstances is a contingent liability reflected in the accounting records as though an actual liability exists?
Q5) The lower the interest rate, the lower the future value factor.
A)True
B)False
Q6) Accrued liabilities often arise as a result of the passage of time.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 12
Chapter 11: Long Term Assets
Available Study Resources on Quizplus for this Chatper
241 Verified Questions
241 Flashcards
Source URL: https://quizplus.com/quiz/74355
Sample Questions
Q1) The depreciable cost of an asset is
A) the unexpired cost of the asset.
B) original cost minus residual value.
C) the expired cost of the asset.
D) original cost minus accumulated depreciation.
Q2) Under tax depreciation, estimated useful life and residual value must be strictly adhered to.
A)True
B)False
Q3) A $750 gain on the sale of an asset means that $750 in cash was received.
A)True
B)False
Q4) A revenue expenditure results in the immediate recognition of an expense.
A)True
B)False
Q5) Under the successful efforts method, the costs of both successful and unsuccessful exploration for oil and gas are recorded as assets.
A)True
B)False
Q6) What is goodwill and when may it be recorded?
Page 13
To view all questions and flashcards with answers, click on the resource link above.
Chapter 12: Contributed Capital
Available Study Resources on Quizplus for this Chatper
189 Verified Questions
189 Flashcards
Source URL: https://quizplus.com/quiz/74354
Sample Questions
Q1) A corporation records a dividend-related liability
A) on the payment date.
B) on the record date.
C) on the declaration date.
D) when the stock sells ex-dividend.
Q2) A corporation is a separate entity for legal purposes.
A)True
B)False
Q3) When treasury stock is sold at a price below its cost, the entry to record the sale has the effect of reducing total stockholders' equity.
A)True
B)False
Q4) Holders of preferred stock normally do not have
A) preference as to dividends.
B) preference as to assets in liquidations.
C) full voting rights.
D) ownership interests in the corporation.
Q5) The death of a stockholder results in the dissolution of the corporation.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 14
Chapter 13: Long Term Liabilities
Available Study Resources on Quizplus for this Chatper
194 Verified Questions
194 Flashcards
Source URL: https://quizplus.com/quiz/74353
Sample Questions
Q1) The calculation of cash for interest to be paid each interest period in connection with a bond payable is not influenced by any premium or discount upon issuance.
A)True
B)False
Q2) Accounting for a defined benefit pension plan is simpler than accounting for a defined contribution plan.
A)True
B)False
Q3) A bond agreement is referred to as the debenture.
A)True
B)False
Q4) When interest payments on an investment exceed the earnings from the investment, negative financial leverage has occurred.
A)True
B)False
Q5) When a bond sells at a premium, what is probably true about the market interest rate versus the face interest rate? Discuss.
To view all questions and flashcards with answers, click on the resource link above.
Page 15
Chapter 14: The Corporate Income Statement and the Statement of Stockholders Equity
Available Study Resources on Quizplus for this Chatper
176 Verified Questions
176 Flashcards
Source URL: https://quizplus.com/quiz/74352
Sample Questions
Q1) On December 31, 2009, Kallman Corporation had 160,000 shares of common stock issued and outstanding. On April 1, 2010, an additional 40,000 shares of common stock were issued for cash. During 2010, Kallman declared and paid dividends of $150,000 on its 20,000 shares of nonconvertible preferred stock. Net income for 2010 amounted to $400,000. Kallman's earnings per share of common stock (rounded to the nearest cent) for 2010 are
A) $1.25.
B) $1.32.
C) $2.00.
D) $2.11.
Q2) What effect will the purchase of treasury stock have on total stockholders' equity and earnings per share, respectively?
A) Increase and decrease
B) Decrease and increase
C) Decrease and no effect
D) Decrease and decrease
Q3) A liability arises when the board of directors declares a stock dividend.
A)True
B)False
Q4) Distinguish between cash and retained earnings.
To view all questions and flashcards with answers, click on the resource link above. Page 16
Chapter 15: The Statement of Cash Flows
Available Study Resources on Quizplus for this Chatper
149 Verified Questions
149 Flashcards
Source URL: https://quizplus.com/quiz/74351
Sample Questions
Q1) Royer Corporation engaged in this transaction: Paid interest on note.
Indicate which section, if any, the above transaction would appear in, or relate to, on a statement of cash flows.
A) Financing activities section
B) Schedule of noncash investing and financing transactions
C) Investing activities section
D) Operating activities section
Q2) For purposes of preparing the statement of cash flows, cash is defined as including both cash and cash equivalents.
A)True
B)False
Q3) Cash equivalents include money market accounts, commercial paper, U.S. Treasury bills, and other short-term investments or marketable securities.
A)True
B)False
Q4) Dividends paid are reflected in the financing activities section of the statement of cash flows.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 17
Chapter 16: Financial Performance Measurement
Available Study Resources on Quizplus for this Chatper
163 Verified Questions
163 Flashcards
Source URL: https://quizplus.com/quiz/74350
Sample Questions
Q1) Contrast the circumstances where horizontal analysis would be an effective analysis tool with those where common-sized analysis would be more useful.
Q2) Which of the following is the least useful in evaluating a relationship as either favorable or unfavorable?
A) Past and current performances of the company
B) Industry averages
C) Past performance of the company
D) Rule-of-thumb measures
Q3) In a common-size balance sheet, total assets are represented by 100 percent.
A)True
B)False
Q4) Profitability is the ability to pay bills when due and to meet unexpected needs for cash.
A)True
B)False
Q5) Both profit margin and asset turnover affect a company's return on assets.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 18
Chapter 17: Partnerships
Available Study Resources on Quizplus for this Chatper
129 Verified Questions
129 Flashcards
Source URL: https://quizplus.com/quiz/74349
Sample Questions
Q1) It is possible for a partner's Capital account to increase as a result of the allocation of a net loss.
A)True
B)False
Q2) Which of the following does not result in the dissolution of a partnership?
A) Death of a partner
B) Admission of a new partner
C) Withdrawal of a partner
D) Sale of partnership assets
Q3) When a newly admitted partner pays a bonus to the existing partners, the new partner's capital account is debited.
A)True
B)False
Q4) Sid and Sally divide partnership income and losses solely on the basis of their average capital balances. Sid had $27,500 invested during all of 2010; Sally had $20,000 invested from January 1 to August 31, and she invested another $7,500 on September 1. If income was $80,000 during 2010, how much should each partner receive?
Q5) Describe how a dissolution of a partnership is different from a liquidation of a partnership.
To view all questions and flashcards with answers, click on the resource link above. Page 19
Chapter 18: The Changing Business Environment-A
Managers Pers
Available Study Resources on Quizplus for this Chatper
130 Verified Questions
130 Flashcards
Source URL: https://quizplus.com/quiz/74348
Sample Questions
Q1) Identify and explain the important questions a manager must address before preparing a managerial report. (Hint: Think "w's.")
Q2) Internal accounting reports should be prepared when they are needed, without regard to calendar dates or regularity of issue.
A)True
B)False
Q3) The objectivity standards of management accountants state that management accountants must communicate information fairly and objectively. This means essentially that accountants must perform each task
A) as professionals, possessing the degree of skill of those management accountants who held the position before them.
B) to provide relevant information, both positive and negative, to the recipients of their reports.
C) in conformity with generally accepted accounting principles.
D) to the satisfaction of government regulators.
Q4) Give two examples of nonfinancial performance measures.
Q5) Identify three uses of the costs of quality information.
Page 20
Q6) Give two examples of each stage in the management process.
To view all questions and flashcards with answers, click on the resource link above.
Chapter 19: Cost Concepts and Cost Allocation
Available Study Resources on Quizplus for this Chatper
188 Verified Questions
188 Flashcards
Source URL: https://quizplus.com/quiz/74347
Sample Questions
Q1) The Finished Goods Inventory and Cost of Goods Sold for a manufacturing company for the year 20xx are as follows: January 1 Finished Goods Inventory, $382,500; December 31 Finished Goods Inventory, $270,000; Cost of Goods Sold for the year, $1,522,000. The cost of goods manufactured for the year was
A) $1,139,500.
B) $644,500.
C) $1,184,500.
D) $1,409,500.
Q2) Minor materials and other production supplies that cannot be conveniently or economically traced to specific products are accounted for as indirect materials.
A)True
B)False
Q3) Materials and supplies that cannot be traced conveniently to specific products are called
A) indirect materials.
B) raw materials.
C) minor materials.
D) direct materials.
To view all questions and flashcards with answers, click on the resource link above.
Chapter 20: Costing Systems: Job Order Costing
Available Study Resources on Quizplus for this Chatper
88 Verified Questions
88 Flashcards
Source URL: https://quizplus.com/quiz/74346
Sample Questions
Q1) Unlike a job order costing system, a process costing system is not restricted to one Work in Process Inventory account.
A)True
B)False
Q2) In a process costing system, product costs are traced to individual products.
A)True
B)False
Q3) Explain the similarities and differences between job order costing and process costing. Focus on the characteristics of each type of system.
Q4) Which of the following products probably would be produced by a company using a process costing system?
A) A house
B) A customized ice cream
C) Paper
D) A movie
Q5) Few actual production processes fit the definitions of job order costing or process costing exactly.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 22
Chapter 21: Costing Systems Process Costing
Available Study Resources on Quizplus for this Chatper
136 Verified Questions
136 Flashcards
Source URL: https://quizplus.com/quiz/74345
Sample Questions
Q1) Which of the following cost flow assumptions most closely follows the logical product flow in a process costing environment?
A) Average
B) LIFO
C) FIFO
D) HIFO
Q2) Jackson Electronics, Inc., manufactures a variety of microelectronic component parts and utilizes a process costing system. The following information was provided by the accounting department as of July 31, 2010:
a. Units started during the month of July totaled 118,200.
b. Units partially complete as of July 31 equaled 7,400.
c. Ending work in process inventory as of July 31, 2010, was 70 percent complete.
d. Direct materials are added at the beginning of the process, and conversion costs are incurred uniformly throughout the process.
e. Units in process on July 1, 2010 - 8,200 units.
Using the information provided, compute the equivalent units of production for direct materials and conversion costs for July using the average costing method.
To view all questions and flashcards with answers, click on the resource link above. Page 23
Chapter 22: Activity-Based Systems-Abm and Lean
Available Study Resources on Quizplus for this Chatper
152 Verified Questions
152 Flashcards
Source URL: https://quizplus.com/quiz/74344
Sample Questions
Q1) In the JIT environment, direct materials and conversion costs should be nearly uniform for each product in a work cell.
A)True
B)False
Q2) Which of the following statements contradicts the philosophy underlying the just-in-time operating environment?
A) The work force must become multiskilled in order to operate many different machines and perform other tasks in the work cell.
B) A customer order triggers the purchase of materials and the activation of the production process.
C) Large inventories are maintained in order to fulfill customer orders on a timely basis.
D) Flexible work cells are created to increase productivity.
Q3) A change to just-in-time manufacturing expands mainly the role of the A) cost accountant.
B) machine operator.
C) purchasing manager.
D) quality control inspector.
Q4) Why is process value analysis not part of the general ledger accounting system?
To view all questions and flashcards with answers, click on the resource link above.
Chapter 23: Cost Behavior Analysis
Available Study Resources on Quizplus for this Chatper
166 Verified Questions
166 Flashcards
Source URL: https://quizplus.com/quiz/74343
Sample Questions
Q1) The engineering method of separating costs
A) is generally used to estimate the cost of activities and new products.
B) is sometimes called a time and motion study.
C) is expensive to use because it is so detailed.
D) All of the above are correct.
Q2) If fixed costs are $80,000, the contribution margin is $25 per unit, and the targeted profit is $30,000, then the required unit sales are
A) 4,400 units.
B) 2,000 units.
C) 4,500 units.
D) 2,500 units.
Q3) For profit planning purposes, the following equation is used: Target Sales Units = (FC + P) CM per Unit.
A)True
B)False
Q4) Cost-volume-profit analysis assumes a constant sales mix.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
25
Chapter 24: The Budgeting Process
Available Study Resources on Quizplus for this Chatper
116 Verified Questions
116 Flashcards
Source URL: https://quizplus.com/quiz/74342
Sample Questions
Q1) Which of the following provides the catalyst for all operating budgets?
A) Firm's ten-year plan
B) Production budget (units)
C) Capital expenditures budget
D) Unit sales forecast
Q2) Which of the following is not true about the direct materials purchases budget?
A) It is determined by the anticipated change in the direct materials inventory level and the production budget.
B) The direct materials purchases budget does not affect the forecasted balance sheet.
C) The direct materials purchases budget is expressed in units and dollars.
D) It is used in preparing the budgeted income statement.
Q3) After management has set short-term goals, the budgeting process typically starts with
A) a clearly defined timetable of events.
B) input only from the accounting personnel.
C) the naming of an efficient coordinator or director.
D) a set of procedures or instructions.
Q4) Describe three benefits budgeting provides to an organization's success.
To view all questions and flashcards with answers, click on the resource link above. Page 26
Chapter 25: Performance Management and Evaluation
Available Study Resources on Quizplus for this Chatper
117 Verified Questions
117 Flashcards
Source URL: https://quizplus.com/quiz/74341
Sample Questions
Q1) The way in which the performance of a cost center is evaluated is similar to A) job order costing.
B) standard costing.
C) process costing.
D) none of these choices.
Q2) One of the overall goals of the Pancake House Restaurant is customer satisfaction. In the light of that goal, match the internal business processes perspective with the appropriate objective.
A) Customer satisfaction means that the chefs engage in culinary continuing education.
B) Customer satisfaction means that customers receive their food within 10 minutes of placing an order.
C) Customer satisfaction means that the customer appreciation program is successful.
D) Customer satisfaction means that the restaurant is profitable.
Q3) What is the business purpose of the balanced scorecard, and how does it benefit an organization?
Q4) Why is it important that a manager's evaluation be based only on those revenues and costs that he or she can control?
To view all questions and flashcards with answers, click on the resource link above.
Chapter 26: Standard Costing and Variance Analysis
Available Study Resources on Quizplus for this Chatper
120 Verified Questions
120 Flashcards
Source URL: https://quizplus.com/quiz/74340
Sample Questions
Q1) Standard costs are useful for all but which of the following?
A) Determining actual costs
B) Preparing budgets and forecasts
C) Evaluating the performance of workers and management
D) Helping to develop appropriate selling prices
Q2) Underfoot Products uses standard costing. The following information about overhead was generated during May: \(\begin{array}{ll}
\text { Standard variable overhead rate } & \$ 2 \text { per machine hour } \\
\text { Standard fixed overhead rate } & \$ 1 \text { per machine hour } \\
\text { Actual variable overhead costs } & \$ 390,000 \\
\text { Actual fixed overhead costs } & \$ 175,000 \\
\text { Budgeted fixed overhead costs } & \$ 190,000 \\
\text { Standard machine hours per unit produced } & 10 \\
\text { Good units produced } & 18,000 \\
\text { Actual machine hours } & 198000
\end{array}\) Compute the variable overhead efficiency variance.
A) $56000 (F)
B) $56000 (U)
C) $46000 (F)
D) $36000 (U)
To view all questions and flashcards with answers, click on the resource link above.
Page 28
Chapter 27: Short Run Decision Analysis
Available Study Resources on Quizplus for this Chatper
90 Verified Questions
90 Flashcards
Source URL: https://quizplus.com/quiz/74339
Sample Questions
Q1) Products Green, Red, and White have unit contribution margins of $6.50, $12, and $10, respectively, and require 2, 4, and 3 direct labor hours per unit, respectively. If demand currently is far exceeding supply, on which product should the company concentrate its efforts?
A) Green
B) Red
C) White
D) Either Green or Red
Q2) The first step in the incremental analysis is to eliminate any irrelevant revenues and costs.
A)True
B)False
Q3) The point at which products are separated in a joint production process is the A) split-off point.
B) joint product point.
C) separation point.
D) breakeven point.
Q4) Sunk costs are not relevant for decisions based on incremental analysis.
A)True
B)False
Page 29
To view all questions and flashcards with answers, click on the resource link above.
Chapter 28: Capital Investment Analysis
Available Study Resources on Quizplus for this Chatper
123 Verified Questions
123 Flashcards
Source URL: https://quizplus.com/quiz/74338
Sample Questions
Q1) The minimum rate of return is fixed by the stockholders.
A)True
B)False
Q2) The cost of debt, the cost of preferred stock, the cost of common stock and the cost of retained earnings are the components of cost of capital.
A)True
B)False
Q3) Smile Industries capital structure consists of $1,000,000 of debt at 6 percent interest and 1,500,000 of stockholders equity at 2 percent. The proportion of Equity in the total capital structure is
A) 40%
B) 60%
C) 100%
D) 15%
Q4) The net present value method of evaluating proposed investments
A) measures a project's time-adjusted rate of return.
B) discounts cash flows at the minimum desired rate of return.
C) ignores cash flows beyond the payback period.
D) applies only to mutually exclusive investment proposals.
To view all questions and flashcards with answers, click on the resource link above. Page 30