Financial Management
Exam Answer Key
Course Introduction
Financial Management introduces the fundamental principles and techniques used to make effective financial decisions within organizations. The course covers key topics such as financial statement analysis, time value of money, capital budgeting, working capital management, risk and return, and the cost of capital. Students will explore how managers plan for, acquire, and utilize funds to maximize the value of the firm while balancing risk and profitability. Through case studies and practical applications, learners gain skills in analyzing financial data, budgeting, and strategic planning to support organizational objectives.
Recommended Textbook
Managerial Accounting 4th Edition by Karen W. Braun
Available Study Resources on Quizplus
15 Chapters
3456 Verified Questions
3456 Flashcards
Source URL: https://quizplus.com/study-set/3392
Page 2
Chapter 1: Introduction to Managerial Accounting
Available Study Resources on Quizplus for this Chatper
205 Verified Questions
205 Flashcards
Source URL: https://quizplus.com/quiz/67296
Sample Questions
Q1) Which of the following is not one of the IMA's overarching ethical principles?
A)Fairness
B)Responsibility
C)Honesty
D)Creativity
Answer: D
Q2) Lean thinking is both a philosophy and a business strategy of manufacturing without waste.
A)True
B)False Answer: True
Q3) Businesses are now viewing sustainability and social responsibility as opportunities for innovation and business development.
A)True
B)False Answer: True
Q4) Lean production cuts the throughput time of a manufacturing concern.
A)True
B)False Answer: True
Page 3
To view all questions and flashcards with answers, click on the resource link above.
Chapter 2: Building Blocks of Managerial Accounting
Available Study Resources on Quizplus for this Chatper
284 Verified Questions
284 Flashcards
Source URL: https://quizplus.com/quiz/67297
Sample Questions
Q1) Service companies have the most complex accounting with regard to the income statement.
A)True
B)False
Answer: False
Q2) Rent on a factory building would be considered to be a ________ cost.
A)product
B)period
C)direct
D)none of the above
Answer: A
Q3) A restaurant is facing a decision about whether it should bake its own apple pies or whether it should continue to purchase the pies from a local bakery.Which of the following costs would be relevant to its decision?
A)The salary of the restaurant manager
B)The price the restaurant sells the apple pies for
C)The purchase price of the apple pies purchased from the local bakery
D)The original purchase price of the current machinery
Answer: C
To view all questions and flashcards with answers, click on the resource link above.
Page 4
Chapter 3: Job Costing
Available Study Resources on Quizplus for this Chatper
334 Verified Questions
334 Flashcards
Source URL: https://quizplus.com/quiz/67298
Sample Questions
Q1) A ________ is a document manufacturing production personnel use to request that the itemized materials be sent from the showroom into the factory.
A)cost ticket
B)job cost record
C)materials requisition
D)manufacturing ticket
Answer: C
Q2) To record direct labor costs incurred,which of the following accounts would be debited?
A)Finished Goods Inventory account
B)Manufacturing Overhead Account
C)Work-in-Process Inventory Account
D)Wages Payable account
Answer: C
Q3) The Work-in-Process account is debited for the cost of direct labor in a job cost system.
A)True
B)False
Answer: True
To view all questions and flashcards with answers, click on the resource link above.
Page 5
Chapter 4: Activity-Based Costing, lean Operations, and the Costs of Quality
Available Study Resources on Quizplus for this Chatper
251 Verified Questions
251 Flashcards
Source URL: https://quizplus.com/quiz/67299
Sample Questions
Q1) Machine set-up would most likely be classified as a ________ cost.
A)batch-level
B)unit-level
C)product-level
D)facility-level
Q2) Non-value added activities are
A)also called waste activities.
B)activities that neither enhance the customer's image of the product or service nor provide a competitive advantage.
C)activities that could be reduced or removed from the process with no ill effect on the end product or service.
D)All of the above.
Q3) Lean companies typically arrange production activities into self-contained cells.
A)True
B)False
Q4) Refined costing systems can be used to allocate any indirect costs to any cost objects.
A)True
B)False
6
To view all questions and flashcards with answers, click on the resource link above.
Chapter 5: Process Costing
Available Study Resources on Quizplus for this Chatper
259 Verified Questions
259 Flashcards
Source URL: https://quizplus.com/quiz/67300
Sample Questions
Q1) The mixing department has 18,000 units and $50,000 in costs for which to account.Of the 18,000 units,12,000 were completed and transferred to the next department.The 6,000 remaining were 25% complete for conversion costs.Direct materials are added at the beginning of the process,and the conversion costs are added evenly throughout the process.The cost per equivalent unit is $2.25 for direct materials and $0.80 for conversion costs.The total costs to account for are
A)$93,000.
B)$50,000.
C)$14,700.
D)$18,300.
Q2) In a process system,direct labor and Manufacturing Overhead are normally
A)incurred at the end of the process.
B)incurred evenly throughout the process.
C)incurred in full at the beginning of the process.
D)not recorded.
Q3) In a job cost system,all costs flow to a particular job.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
Chapter 6: Cost Behavior
Available Study Resources on Quizplus for this Chatper
294 Verified Questions
294 Flashcards
Source URL: https://quizplus.com/quiz/67301
Sample Questions
Q1) If the data points in a scatter plot fall in a fairly straight line,it means that there is a fairly strong relationship between cost and volume.
A)True
B)False
Q2) Green Corporation has total sales revenues of $400,000.If its total fixed costs are $70,000 and its total variable costs are $150,000,the contribution margin is
A)$330,000.
B)$250,000.
C)$550,000.
D)$220,000.
Q3) If there is little or no relationship between the cost and the volume,the data points on a scatter plot will appear almost as a straight line.
A)True B)False
Q4) Total variable costs change in direct proportion to changes in volume. A)True B)False
To view all questions and flashcards with answers, click on the resource link above.
8
Chapter 7: Cost-Volume-Profit Analysis
Available Study Resources on Quizplus for this Chatper
261 Verified Questions
261 Flashcards
Source URL: https://quizplus.com/quiz/67302
Sample Questions
Q1) When calculating the breakeven point in terms of units,fixed costs should be divided by the contribution per unit.
A)True
B)False
Q2) A breakeven mix is the combination of products that are available for sale.
A)True
B)False
Q3) The intersection of the sales revenue line and the variable expense line on a CVP graph is known as
A)the margin of safety point.
B)the unit contribution margin.
C)the breakeven point.
D)none of the above.
Q4) To find a firm's operating leverage factor at a given level of sales,you
A)divide the contribution margin by fixed expenses.
B)divide the contribution margin by operating income.
C)divide variable expenses by fixed expenses.
D)divide relatively operating income by contribution margin.
To view all questions and flashcards with answers, click on the resource link above.
Chapter 8: Relevant Costs for Short-Term Decisions
Available Study Resources on Quizplus for this Chatper
253 Verified Questions
253 Flashcards
Source URL: https://quizplus.com/quiz/67303
Sample Questions
Q1) Paula has the following information to evaluate-her current salary of $55,000 versus total revenues of $120,000 and expenses of $75,000 from starting a new business.How much is the opportunity cost associated with starting the new business?
A)$55,000
B)$120,000
C)$45,000
D)$75,000
Q2) What is the difference between relevant and irrelevant information for making decisions.Provide examples of each.
Q3) An "opportunity cost" is best described by which of the following?
A)Benefits foregone by choosing a particular alternative course of action
B)Costs that were incurred in the past and cannot be changed
C)The distribution of all products to be sold
D)Expected future costs that differ among alternatives
Q4) If the cost savings from discontinuing a product exceed the lost revenues from discontinuing the product,it should be retained.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 10
Chapter 9: The Master Budget
Available Study Resources on Quizplus for this Chatper
200 Verified Questions
200 Flashcards
Source URL: https://quizplus.com/quiz/67304
Sample Questions
Q1) June sales were $5,000 while projected sales for July and August were $6,500 and $7,000,respectively.Sales are 35% cash and 65% credit.All credit sales are collected in the month following the sale.What are the total expected collections for July?
A)$7,975
B)$5,525
C)$6,825
D)$5,975
Q2) June sales were $6,000 while projected sales for July and August were $8,500 and $7,000,respectively.All credit sales are collected in the month following the sale.Sales are 75% credit and 25% cash.What are the total expected collections for July?
A)$8,375
B)$7,875
C)$7,375
D)$6,625
Q3) A merchandising company has a production budget.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
Chapter 10: Performance Evaluation
Available Study Resources on Quizplus for this Chatper
212 Verified Questions
212 Flashcards
Source URL: https://quizplus.com/quiz/67305
Sample Questions
Q1) Goal congruence is a system that evaluates the performance of each responsibility center and its manager.
A)True
B)False
Q2) Which of the following is the operating income an investment center generates before subtracting common fixed costs that are allocated to the center?
A)Sales volume variance
B)Segment margin
C)Return on investment (ROI)
D)Return on assets (ROA)
Q3) Decentralization allows top management to hire workers with expert knowledge in each business unit.
A)True
B)False
Q4) The production line at Morningstar Farms may be classified as a(n)
A)investment center.
B)cost center.
C)profit center.
D)revenue center.
To view all questions and flashcards with answers, click on the resource link above. Page 12
Chapter 11: Standard Costs and Variances
Available Study Resources on Quizplus for this Chatper
241 Verified Questions
241 Flashcards
Source URL: https://quizplus.com/quiz/67306
Sample Questions
Q1) The variable overhead rate variance tells managers whether more or less was spent on variable overhead than they expected for the hours worked.
A)True
B)False
Q2) Price and quantity variances are a way to motivate employees.
A)True
B)False
Q3) A company's purchasing department negotiates all of the purchasing contracts for raw materials.Which variance is most useful in assessing the performance of the purchasing department?
A)Direct materials quantity variance
B)Direct materials price variance
C)Direct labor rate variance
D)Direct labor efficiency variance
Q4) A debit balance in the direct materials price variance indicates the standard cost of materials was less than the actual cost of materials.
A)True
B)False
Q5) Identify four advantages of standard costs and variances.
To view all questions and flashcards with answers, click on the resource link above. Page 13
Chapter 12: Capital Investment Decisions and the Time Value of Money
Available Study Resources on Quizplus for this Chatper
195 Verified Questions
195 Flashcards
Source URL: https://quizplus.com/quiz/67307
Sample Questions
Q1) Choosing among alternative capital investments is called a post-audit.
A)True
B)False
Q2) The net present value method does not incorporate the time value of money.
A)True
B)False
Q3) Pro-Am Audio is a company that is contracted to DJ private events.Due to a recent increase in bookings,Pro-Am is considering the purchase of another mobile DJ unit.Pro-Am uses the payback method to evaluate its investments.The mobile DJ unit will cost $12,000,has a useful life of 10 years,and will generate $2,000 in net cash inflows per year.The residual value of the unit is $1,000.What is the payback period for the mobile DJ unit?
A)6.50 years
B)5.50 years
C)6.00 years
D)4.00 years
Q4) The ARR is the only method that uses accrual accounting figures and thus making it important to financial statement users.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 14
Chapter 13: Statement of Cash Flows
Available Study Resources on Quizplus for this Chatper
183 Verified Questions
183 Flashcards
Source URL: https://quizplus.com/quiz/67308
Sample Questions
Q1) Which of the following is/are created by operating activities?
A)An increase in long-term debt
B)An increase in common stock
C)Revenues and expenses
D)Both A and B
Q2) Activities that are included in the operating activities section of the statement of cash flows include which of the following activities?
A)Activities that obtain the cash needed to launch and sustain the business
B)Activities that increase or decrease long-term assets
C)Activities that create revenue or expenses in the entity's major line of business
D)None of the above
Q3) The beginning and ending balances of long-term debt are $64,000 and $35,200,respectively,and,cash payments for long-term debt during the year were $34,100.How much new long-term debt was issued during the year?
A)New long-term debt issued during the year was $1,100.
B)New long-term debt issued during the year was $5,300.
C)New long-term debt issued during the year was $28,800.
D)New long-term debt issued during the year was $62,900.
To view all questions and flashcards with answers, click on the resource link above.
15
Chapter 14: Financial Statement Analysis
Available Study Resources on Quizplus for this Chatper
177 Verified Questions
177 Flashcards
Source URL: https://quizplus.com/quiz/67309
Sample
Questions
Q1) An accurate description of horizontal analysis would be which of the following?
A)Study of percentage changes in various financial statement amounts from year to year
B)Study of changes in individual financial statement amounts as a percentage of a related base amount
C)Study of changes in key financial ratios from year to year
D)None of the above
Q2) Generally,using more than one year of data to analyze company performance is desirable.
A)True
B)False
Q3) Common size statements allow the comparison of two or more companies with different amounts of net sales and net assets.
A)True
B)False
Q4) The inventory turnover ratio indicates how rapidly inventory is sold.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
Page 16
Chapter 15: Sustainability
Available Study Resources on Quizplus for this Chatper
107 Verified Questions
107 Flashcards
Source URL: https://quizplus.com/quiz/67310
Sample Questions
Q1) The costs associated with hazardous materials transportation are combined with other overhead costs in Horning Corporation's current accounting system.This scenario is an example of which type of EMA implementation challenge?
A)Historical orientation of accounting
B)Communication issue
C)Newness of EMA
D)Hidden Cost
Q2) When it comes to developing an EMA system,there are few reference tools available for environmental management accountants;therefore,organizations are still working to discover what information they need and how it can be reported in an accurate,timely and relevant manner.This scenario is an example of which type of EMA implementation challenge?
A)Historical orientation of accounting
B)Communication issue
C)Newness of EMA
D)Hidden Cost
Q3) An EMA system only requires aggregated data to function effectively.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
Page 17