Quiz
A200 Final
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Fragen in diesem Quiz (130)
1Which of the following financial statement elements is closed at the end of an accounting cycle?
- ALiabilities
- BEquity
- CRevenues
- DAssets
2The recognition of an expense may be accompanied by which of the following?
- Aan increase in assets
- Ba decrease in liabilities
- Ca decrease in revenue
- Dan increase in liabilities
3Recording accrued salary expense at the end of an accounting period causes an increase in Salaries Expense and
- Aan increase in a liability
- Ba decrease in an asset
- Can increase in an equity account
- Dnone of these
4Which of the following does not involve a deferral?
- Areceipt of advance fees from clients
- Brecording salaries of employees earned but not yet paid
- Cpayment of six months rent
- Dpurchase of supplies on account
5Resources that a business uses to operate the business are called
- Aassets
- Bequity
- Crevenues
- Dliabilities
6Most assets must be reported on the balance sheet at
- Atheir current replacement cost
- Bfair market value
- Can amount estimated by the company's management
- Dhistoric cost
7Paying for a two-year insurance policy in advance will have what impact on a company's account classifications?
- Aincrease assets, increase stockholders' equity
- Bincrease assets, increase liabilities
- Cincrease assets, decrease liabilities
- Dthis transaction will have no impact on major classification totals
8Under accrual basis of accounting
- Acash must be received before revenue is recognized
- Bnet income is calculated by matching cash outflows against cash inflows
- Cevents that change a company's financial statements are recognized in the period they occur rather than in the period in which cash is paid/received
- Dthe ledger, accounts must be adjusted to reflect a cash basis of accounting before financial statements are prepared under generally accepted accountant principles
9Which of the following events involves an accrual?
- Ainterest earned but not received
- Bsupplies purchased with cash but not yet used
- Ca cash payment received from a customer before services provided
- DA and C
10The recognition of an expense may be accompanied by which of the following?
- Aan increase in assets
- Ba decrease in liabilities
- Ca decrease in revenue
- Dan increase in liabilities
- Enone of the above
11Which of the following accounts is a permanent account (an account that is not closed)?
- ARent expense
- BService revenue
- CDividends
- DPrepaid Insurance
12Which of the following accounts is a temporary account?
- Aprepaid insurance
- Bunearned subscriptions revenue
- Cretained earnings
- Dsubscription revenue
13The matching concept refers to the "matching" of
- Aexpenses and liabilities
- Bexpenses and revenues
- Cassets and equity
- Dassets and liabilities
14Which of the following transactions involve a deferral?
- Arecording the payment of 3 months rent
- Brecording the interest earned (but not received) on a certificate of deposit
- Crecording interest accepted on a note payable
- Drecording salaries of employees earned but not yet paid
15The accountant for ProTex Painting forgot the following two adjustments at the end of 1997:
A) the entry to record depreciation: $750
B) the entry to record the portion of fees received in advance which have now been earned: $750
As a result of these 2 omissions:- Anet income for ProTex Painting for 1997 is overstated
- Bnet income for ProTex Painting for 1997 is understated
- Cassets of ProTex Painting are understated at December 31, 1997
- Dliabilities of ProTex Painting are overstated at December 31, 1997
16If a company fails to adjust a Prepaid Rent account for rent that has expired, what effect will this have on that month's financial statements?
- Afailure to make an adjustment does not affect the financial statements
- Bexpenses will be overstated and net income and owner's equity will be understated
- Cassets will be overstated and net income and owner's equity will be understated
- Dassets will be overstated and net income and owner's equity will be overstated
17Recognition of revenue may result in which of the following?
- Aa decrease in a liability
- Ban increase in a liability
- Can increase in assets
- DA and C
18Depreciation is the process of
- Avaluing an asset at its fair market value
- Bincreasing the value of an asset over its useful life in a rational and systematic manner
- Callocating the cost of a productive asset to expense over its useful life in a rational and systematic manner
- Dwriting down an asset to its real value each accounting period
19The balance sheet item that represents the portion of stockholders' equity resulting from profitable operation of the business is:
- Aaccounts receivable
- Bcash
- Ccapital stock
- Dretained earnings
20The purpose of the accrual basis of accounting is to:
- Areport revenue when received
- Bimprove the matching of revenue and expense in the proper period
- Creport expenses when cash disbursements are made
- Dimprove the company's earnings per share
21Perry's Puppies needed additional equipment, which was purchased on credit for $600. Which of the following is not true regarding the accounting for this transaction?
- AEquipment increased by $600
- BAccounts payable increased by $600
- CExpenses increased by $600
- DAll of the above are true
22At the first of the month Max paid a total of $2,400 for six months rent in advance. When he recorded the payment, he entered $2,400 into the Prepaid Rent account. At the end of the month, what adjustment should Max make?
- AIncrease Prepaid Rent by $400 and increase Rent Expense by $400
- BDecrease Prepaid Rent by $2,400 and decrease Rent Expense by $2,400
- CDecrease Prepaid Rent by $400 and decrease Rent Expense by $400
- DNone of the above
23Which of the following adjustments are necessary if a company has earned 1/3 of a customer's prepayment of insurance premium?
- Aincrease unearned revenue
- Bincrease cash
- Cincrease insurance revenue
- Dincrease insurance expense
24Which of the following transactions changes only the mix of assets and does not affect liabilities or stockholders' equity?
- Aborrowed $40,000 from First National Bank
- Bpurchased land for cash
- Creceived $3,800 for fees earned
- Dpaid $4,000 for office salaries
25On January 24, 2007, Niche Consulting collected $5,700 it had billed its clients for services rendered on December 31, 2006. How would you record the January 24 transaction, using the accrual basis?
- AIncrease Cash, $5,700; decrease Fees Earned, $5,700
- BIncrease Accounts Receivable, $5,700; increase Fees Earned, $5,700
- CIncrease Cash, $5,700; decrease Accounts Receivable, $5,700
- DIncrease Cash, $5,700; increase Fees Earned, $5,700
26If a company fails to adjust unearned revenue for services that had been performed, what effect will this have on major accounts classifications?
- Aunderstate revenues, understate net income, overstate assets, understate stockholders' equity
- Bunderstate revenues, understate net income, overstate liabilities, overstate stockholders' equity
- Cunderstate revenues, understate net income, understate liabilities, understate stockholders' equity
- Dunderstate revenues, understate net income, overstate liabilities understate stockholders' equity
27One purpose of making closing entries is
- Ato reduce the number of expense accounts
- Bto prepare the temporary accounts for the recording of the next period's activities
- Cto establish new balances j.n the asset and liability accounts
- Dto enable the accountant to prepare financial statements at the end of the accounting period
- Enone of the above
28Guy, Inc., pays its employees on the tenth day of each month. If the adjusting entry for accrued wages on December 31 were not made, which of the following would result?
- AAssets would be overstated.
- BStockholders' equity would be understated.
- CNet income for the period would be understated.
- DLiabilities would be understated.
- ENet income for the period would be unaffected.
29Adjusting entries
- Aassign revenues to the period in which they are earned.
- Bhelp to properly measure the periods net income or net loss.
- Cbring asset and liability accounts to correct balances.
- Dall of the above.
30Which of the following statements about owner's equity is NOT correct?
- AExpenses decrease owner's equity
- BContributions of owners increase owner's equity
- CDividends distributed to owners increase owner's equity
- DRevenues increase owner's equity
31On April 20, Iceland Rink agrees to rent the skating rink to the St. Paul Hockey Club four hours every day during May. The total cost of the ice time is $6,000. The Hockey Club pays $2,000 on April 20 and the remaining $4,000 on June 10. Assuming that Iceland prepares monthly financial statements and uses the accrual basis of accounting, it should recognize this $6,000 revenue.
- AIn April
- BIn May
- C$2,000 in April and $4,000 in June
- DIn June
32On April 20, Iceland Rink agrees to rent the skating rink to the St. Paul Hockey Club four hours every day during May. The total cost of the ice time is $6,000. The Hockey Club pays $2,000 on April 20 and the remaining $4,000 on June 10. Assume the same facts as in the preceding question, except that Iceland Rink uses the cash basis of accounting. Iceland should recognize the $6,000 revenue
- AIn April
- BIn May
- C$2,000 in April and $4,000 in June
- DIn June
33Examples of accruals are
- Asalaries payable, depreciation of equipment, and prepaid insurance
- Btaxes payable, rent received in advance, and office supplies
- Cprepaid rent, revenue received in advance, and prepaid salaries
- Dsalaries payable, interest receivable, and taxes payable
34Which one of the following direct effects on the fundamental accounting model is NOT possible as a result of transaction analysis?
- Adecrease a liability and decrease an asset
- Bincrease owner's equity and increase an asset
- Cincrease an asset and decrease and asset
- Ddecrease owner's equity and increase an asset
35The bookkeeping failed to accrue interest expense at year end. This will result in an
- Aunderstatement of liability, and an overstatement of net income and owner's equity
- Boverstatement of liabilities and an understatement of net income and owner's equity
- Coverstatement of assets, net income, and owner's equity
- Dunderstatement of assets, net income, and owner's equity
36The 2 major divisions of stockholder's equity are
- Arevenues and expenses
- Bsales and costs of goods sold
- Cassets and liabilities
- Dcontributed capital and retained earnings
37When expenses exceed revenues in a given period (and there are no gains or losses)
- Aowner's equity will not be impacted
- Bowner's equity will be increased
- Cowner's equity will be decreased
- Done cannot determine the impact on owner's equity without additional information
38Prepaid expenses are
- Apaid and recorded in an asset account before they are used or consumed
- Bpaid and recorded in an asset account after they are used or consumed
- Cincurred but not yet paid or recorded
- Dincurred and already paid or recorded
39A statement of retained earnings shows
- AThe changes in the Cash account occunirig during the the accounting period
- BThe revenue, expense, and dividends of the accounting period
- CThe types of assets which have been purchased with the earnings retained during the accounting period
- DThe changed in the retained earnings account occurring during the accounting period
40The terms "risk" and "retun" are related in that
- Arisky investments always generate low returns
- Bwhen one goes up, the other usually goes up
- Cthey generally rise and fall somewhat inversely
- Dsmaller investments usually incur smaller risk but generate higher returns
41The major accounting difference between interest paid to creditors and dividends paid to owners is
- Ainterest paid decreases and dividends paid increases retained earnings
- Binterest paid is on the income statement and dividends paid are not
- Cinterest paid is not on the income statement and dividends paid are
- DBoth are treated identically by accountants
42When should a company report the cost of an insurance policy as an expense?
- AWhen the company first signs the policy
- BWhen the company pays for the policy
- CWhen the company receives the benefits from the policy over its period of coverage
- DWhen the company receives payments from the insurance company for its insurance claims
43The fiscal year of a business is usually determined by
- Athe IRS
- Bthe lottery
- Cthe business
- Dthe SEC
44If a resource has been consumed but a bill has not been received at the end of the accounting period then
- Aan expense should be recorded when the bill is received
- Ban expense should be recorded when the cash is paid out
- Can adjusting entry should be made recognizing the expense
- Dit is optional whether to record the expense before the bill is received
45If expenses are paid in cash then
- Aassets will increase
- Bliabilities will increase
- Cowner's equity will increase
- Dassets will decrease
46The matching principle means that
- Aexpenses are recorded in the same period as the revenues to which they are related
- Bdebits are matched with credits in each journal entry so that the entry balances
- Cthe taxable income of a corporation matches the income reported to shareholder
- Dmanufacturers of matches use accounting principles that are different from those used by retailers of matches
47The revenue recognition principle means that
- Asome business persons do not realize how much their income their business is earning
- Bexpenses may not be recorded until the related revenue is earned
- Crevenues are recorded when earned, regardless of the time payment is received
- Drevenues cannot occur unless an exchange or performance rakes place
48When a corporation pays a cash dividend it reduces the balance
- Aof its cash account and retained earnings account
- Bof its common stock account and its cash account
- Cof its retained earnings account and its capital account
- Dof its dividends account and its common stock account
49By examining the income statement of a corporation it is possible to determine the amount of
- Amoney available for the payment of dividends
- Bdividends actually paid during the period
- Cexpenses the company incurred on the last day of the accounting period
- Drevenues earned during the accounting period
50Outflows or the using of asset as a result of the major or central operations of a business are termed:
- ALiabilities
- BOwner's equity
- CRevenues
- DExpenses
- ENet losses
51Which of the following financial statements presents the financial position of a firm at a particular point in time?
- Aincome statement
- Bbalance sheet
- Cstatement of cash flows
- Dretained earnings statement
52Income statement accounts are
- Aassets and liabilities
- Brevenues and dividends
- Crevenues and expenses
- Dassets and dividends
53The total assets of Mr. Brown are greater than the total assets of Mr. Greene. From this one can conclude that
- AMr. Brown is wealthier than Mr. Greene.
- BMr. Brown' s balance sheet is different from Mr. Greene's
- CMr. Brown's first name is Charlie
- DMr. Brown owes more money than Mr. Greene
54The two component of stockholders' equity on a balance sheet for a corporation are
- Aliabilities and capital stock
- Bassets and retained earnings
- Cassets and liabilities
- Dcapital stock and retained earnings
55A transaction was recorded as the purchase of an asset during the period but the adjusting entry required at the end of the period was not made. The most likely result is
- Athe asset is overstated and income is understated
- Bthe asset is understated and income is overstated
- Cboth the asset and income are overstated
- Dboth the asset and income are understated
56Lida Corporation receives payment of 5200,000 from customers for amounts previously owed to Lida. The recording of this event in Lida's fmancial statement will:
- Aincrease total assets
- Bdecrease total assets
- Chave no effect on total assets
- Ddecrease total liabilities
57Examples of accruals are
- Asalaries payable, depreciation of equipment, and prepaid insurance
- Btaxes payable, rent received in advance, and office supplies
- Cprepaid rent, revenue received in advance, and prepaid salaries
- Dsalaries payable, interest receivable, and taxes payable
58Which one of the following direct effects on the fundamental accounting model is NOT possible as a result of transaction analysis?
- ADecrease a liability and decrease an asset
- BIncrease owners' equity and increase an asset
- CIncrease an asset and decrease an asset
- DDecrease owners' equity and increase an assett
59Which of the following statements about owners' equity is NOT correct?
- Aexpenses decrease owners' equity
- Bcontributions of owners' equity increase owners' equity
- Cdividends distributed to owners increase owners' equity
- Drevenues increase owners' equity
60If the company's volume doubles, the cost per unit will
- Astay the same
- Bdouble as well
- Cincrease, but will not double
- Ddecrease
61Which of the following appears in the income statement of a merchandising business, but not in the income statement of a business that renders only services?
- Ainterest revenue
- Bgross profit
- Cadvertising expenses
- Dincome taxes expense
62Product costs are also referred to as
- Aperiod costs
- Bselling and administrative expenses
- Coperating expenses
- Dinventory costs
63What is the relationship between gross margin and net income?
- Agross margin - merchandise inventory at the end of the period = net income
- Bgross margin - selling and admin. expenses = net income
- Cgross margin + selling and admin. expenses = net income
- Dsales revenue * gross margin percentage = net income
64Which of the following is a TRUE statement regarding product and/or period costs?
- Aperiod costs never appear in the balance sheet
- Bproduct costs appear on the income statement but never on the balance sheet
- Cperiod costs appear first on the balance sheet and then later on the income statement
- Dneither product nor period costs ever appear on the balance sheet
- Eneither product nor period costs ever appear on the income statement
65Which of the following is TRUE of fixed costs?
- Afixed costs are fixed in total and fixed per unit of the activity base
- Bfixed costs are variable in total and fixed per unit of the activity base
- Cfixed costs are fixed in total and variable per unit of the activity base
- Dfixed costs are variable in the short-run, but are fixed in the long-run
66Work-in-process inventory is composed of:
- Adirect material and direct labor
- Bdirect labor and manufacturing overhead
- Cdirect material only
- Ddirect material, direct labor, and direct manufacturing overhead
67If prices are rising, which of the following gives us the highest cost of goods sold?
- ALIFO
- BFIFO
- Cretail method
- Dweighted average
68Which of the following is a product cost?
- Aadvertising expenditures
- Binsurance on the office buildings
- Cdepreciation of the salesmen's car
- Ddepreciation of the production facilities
69How is the balance sheet of a merchandising firm different from the balance sheet of a service business?
- Ait includes the asset, accounts receivable
- Bit reports the cost of goods sold
- Cit includes the asset, merchandise inventory
- Dit reports various period costs
70The break-even point is that level of activity where total revenue equals:
- Atotal cost
- Bfixed cost
- Cvariable cost
- Dproduct cost
71Management is interested in utilizing the full capacity of production facilities because it
- Aspreads variable costs over a greater number of units, thereby reducing the variable cost per unit
- Bspreads fixed costs over a greater number of units, thereby reducing the fixed cost per unit
- Creduces total variable costs
- Dreduces total fixed costs
72The terms on an invoice are 4/15, n/30. This means that
- Aa discount of 4% will be allowed if payment is made within 15 days from the date of the invoice
- Ba discount of 15% will be allowed if payment is made with 4 days grin the date of the invoice
- Ca discount of 4% will be allowed if payment is made by the 15th of the month
- Da discount of 15% will be allowed if payment is made by the 4th day after the data of the invoice
73The primary disadvantage of a just-in-time inventory system is
- Aa reduction in the amount of money tied up in inventory
- Bthe company must use FIFO inventory method, and forgo the income tax advantages of LIFO
- Csmaller inventories may reduce the company's current ratio and working capital
- Dthe risk is increased of losing sales opportunities or having to shut down manufacturing operations because of inventory shortages
74What costs should be included in the merchandise inventory account of a merchandising firm?
- Athe purchase price of merchandise only
- Ball costs necessary to acquire inventory and prepare it for sale
- Can allocated portion of period costs
- Dthe purchase price of the merchandise + selling expenses
75Which inventory method results in the lowest income taxes during periods of increasing prices?
- AFIFO
- BLIFO
- Cweighted average
- Dwork-in-process
76The inventory valuation method that results in the recognition of the most recent inventory costs on the balance sheet and income statement is
- ABalance sheet - FIFO
Income statement - LIFO - BBalance sheet - FIFO
Income statement - FIFO - CBalance sheet - LIFO
Income statement - LIFO - DBalance sheet - LIFO
Income statement - FIFO
- ABalance sheet - FIFO
77When raw materials enter the production process in a traditional manufacturing setting, their costs are transferred to:
- Aa raw materials account
- Ba direct materials account
- Ca work in process account
- Da costs of goods sold account
78Company's goods in transit at December 31 include sales made
1) FOB destination
2) FOB shipping point
and purchases made
3) FOB destination
4) FOB shipping point
what items should be included in their inventory at December 31?- A2 and 3
- B1 and 4
- C1 and 3
- D2 and 4
79As an incentive for customers to pay their accounts promptly, a business may offer its customers
- Aa sales discount
- Bfree delivery
- Ca sales allowance
- Da sales return
80When the cost of a product is matched with its sales price, the result (difference) is
- Aa cost of goods sold
- Bgross profit
- Cnet income
- Dcontribution margin
81Two companies report the same costs of goods available for sale but each employ a different inventory costing method. If the price of goods has increased during the period, then the company using
- ALIFO will have the highest ending inventory
- BFIFO will have the highest cost of goods sold
- CFIFO will have the highest ending inventory
- DLIFO will have the lowers cost of goods sold
82The LIFO inventory method assumes that the cost of the latest units purchased are
- Athe last to be allocated to cost of goods sold
- Bthe first to be allocated to ending inventory
- Cthe first to be allocated to cost of goods sold
- Dnot allocated to cost of goods sold or ending inventory
83When the sales price rises, the number of units required to be sold to break even
- Aincreases
- Bstays the same
- Cdecreases
- Dthe answer cannot be determined from the above information
84Two categories of expenses in merchandising companies are
- Acost of goods sold and financing expenses
- Boperating expenses and financing expenses
- Ccost of goods sold and operating expenses
- Dsales and cost of goods sold
85The credit term offered to a customer by a business firm were 2/10, n/30, which means that
- Athe customer must pay the bill within 10 days
- Bthe customer can deduct a 2% discount if the bill is paid between the 10th and 30th day of the invoice data
- Cthe customer can deduct a 2% discount if the bill is paid within the 10 days of the invoice date
- Dtwo sales returns can be made within 10 days of the invoice date and no returns thereafter
86The factor which determines whether or not goods should be included in a physical count of inventory is
- Aphysical possession
- Blegal title
- Cmanagement's judgements
- Dwhether or not the purchase price has been paid
87If goods in transit are shipped FOB destination
- Athe seller has legal title to the goods until they are delivered
- Bthe buyer has legal title to the goods until they are delivered
- Cthe transportation company has legal title to the goods while the goods are in transit
- Dno one has legal title to the goods until they are delivered
88Tom had 100 thimbles that were completed at the end of the year but not yet been sold. Where would the costs of these items be found?
- Araw materials
- Bfinished goods
- Cwork in process
- Dcost of goods sold
89Which of the following will increase net income?
- Adecrease sales price
- Bdecrease fixed costs
- Cdecrease sales volume
- Dincrease variable costs
90Which of the following is the difference between the sales revenue per unit and the variable cost per unit?
- Aprofit
- Btotal contribution margin
- Ccontribution margin per unit
- Dnone of the above
91Cost behavior analysis focuses on
- Ahow costs respond to changes in profits
- Bhow costs change over time
- Chow costs change as output changes
- Dnone of the above
92When the sales volume is above the break-even point, the company's
- Atotal costs exceed total revenues
- Bmarginal costs exceed marginal revenues
- Ctotal revenues exceed total costs
- Dit depends on the facts of the situation
93The excess of a product's selling price over its variable costs is referred to as
- Agross profit
- Bcontribution margin
- Cgross margin
- Dmanufacturing margin
94Which of the following should NOT be recorded as an expense?
- Apaid office salaries
- Bpaid factory maintenance costs
- Cpaid product advertising costs
- Dpaid sales commissions
95Which of the following statements is INCORRECT with regard to product costs?
- Aproduct costs flow from the balance sheet to the income statement
- Bunlike direct material and direct labor costs, overhead costs must be allocated products
- Cproduct costs are expensed in the period incurred
- Ddepreciation on manufacturing equipment is an indirect product cost
96Which of the following statements concerning product costs versus general, selling, and administrative costs is true?
- Aproduct costs incurred during the period will always appear as inventory on the balance sheet
- Bgeneral, selling, and administrative costs are always expensed when cash is paid
- Cproduct costs may be divided between the balance sheet and income statement
- Dgeneral, selling, and administrative costs sometimes appear as inventory on the balance sheet
97Identify the true statement regarding how product costs in a manufacturing company differ from product costs in a service company
- Amanufacturing companies incur costs for supplies but service companies do not
- Bmanufacturing companies accumulate product costs for supplies but service companies do not
- Cservice companies generally incur less labor costs than manufacturing companies
- Dservice companies are less competitive than manufacturing companies
98Fixed cost per unit
- Adecreases as production volume decreases
- Bis not affected by changes in the production volume
- Cincreases as production volume increases
- Ddecreases as production volume increases
99All of the following could help to reduce variable costs except
- Apurchase less expensive direct materials
- Breduce direct labor hours necessary for production
- Creduce sales commission percentage
- Dreduce advertising costs
100Which of the following will increase contribution margin?
- Adecrease sales price
- Bdecrease fixed costs
- Cdecrease variable costs
- Dincrease variable costs
101Manufacturing companies
- Aprovide services
- Bbuy merchandise inventory and then resell it
- Ctransform raw materials into finished products
- Ddo none of the above
102To determine the inventory count, a business will count all merchandise that
- Ais physically present
- Bthe business owns
- Cis physically presents plus merchandise shipped FOB destination
- Dis physically presents plus merchandise shipped FOB shipping point
103Which of the following accounts maintained by a manufacturer would be the equivalent of a retailer's merchandise inventory?
- Acost of goods sold
- Bfinished goods inventory
- Cmaterials inventory
- Dwork in process inventory
104As volume increase, average cost per unit
- Aincreases
- Bdecreases
- Cremains constant
- Dincreases in proportion to the change in volume
105All else constant, if the selling price falls,
- Atotal variable costs will be lower than expected
- Bcontribution margin percentage will be higher than expected
- Ctotal contribution margin will be higher than expected
- Dper-unit contribution margin will be lower than expected
106A firm would
- Aprefer to operate above the breakeven point because costs will be lower
- Bprefer to operate above the breakeven point as revenue will be less than costs
- Cprefer to operate above the breakeven point as revenue will be more than costs
- Dprefer to operate at breakeven point because it provided equilibrium
107A physical count of inventory must be taken in order to determine the cost of goods sold under which of the following inventory systems?
- Aperpetual inventory system
- Bperiodic inventory system
- Cweighted-average system
- DLIFO inventory system
108In a period of recession or declining prices, which of the following inventory pricing methods would result in the smallest income tax expense?
- Awighted-average cost
- BLIFO
- CFIFO
- Dall of the above
109The inventory method that includes the most recent prices in cost of goods sold is
- Aaverage cost
- BFIFO
- CLIFO
- Dspecific identification
110If a company has a positive contribution margin but net income is low or negative, what are some ways of increasing net income?
- Adecrease sales price
- Bdecrease sales volume
- Cincrease variable costs
- Dincrease sales volume
111At the break even point, total contribution margin is
- Azero
- Bequal to total fixed costs
- Cequal to total costs
- Dequal to total variable costs
112When the sales price decreases, the number of units requires to be sold to break even
- Aincreases
- Bstays the same
- Cdecreases
- Dthe answer cannot be determined from the information above
113The total contribution margin is calculated as the difference between
- Asales price and variable cost per unit
- Bsales price and fixed cost per unit
- Ctotal revenue and total fixed cost
- Dtotal revenue and total cost
- Etotal revenue and total variable cost
114The contribution income statement differs from the traditional income statement in which of the following ways?
- Athe traditional income statement separates costs into their fixed and variable components
- Bthe traditional income statement subtracts all variable expenses from sales to obtain the contribution margin
- Ccost-volume-profit relationship can be analyzed from the contribution income statement
- Dthe effect of sales volume changes on profit is readily apparent on the traditional income statement
115Firm A and Firm B are competitors within the same industry. Firm A produces its products using large amounts of direct labor. Firm B has replaced direct labor with investment in machinery. Projected sales for both firms are 15% LESS than in the prior year. Which statement regarding projected profits are TRUE?
- AFirm A will lose more profit than Firm B
- BFirm B will lose more profit than Firm A
- CFirm A and Firm B will lose the same amount of profit
- DNeither Firm A or Firm B will lose profit
116Costs that are expensed as incurred are
- Adirect costs
- Bindirect costs
- Cproduct costs
- Dperiod costs
117Goods that are ready for sale are classified as
- Araw materials inventory
- Bwork in process
- Cfinished goods inventory
- Dcost of goods sold
118Product costs are expensed when the product is
- Apurchased
- Bmanufactured
- Cinventoried
- Dsold
119Goods that have been started but are not completed are considered
- Araw material inventory
- Bwork in process
- Cfinished goods inventory
- Dcost of goods sold
120If prices are rising, which of the following gives the lowest ending inventory value?
- Aweighted average
- Bretail inventory method
- CFIFO
- DLIFO
121The FIFO inventory cost method differs from the LIFO method in that the
- ALIFO method more clearly matches current inventory cost with sales revenue
- BFIFO method more clearly matches current inventory cost with sales revenue
- CLIFO method assumes the oldest purchases are stored in the rear of the storage areas
- DFIFO method is more acceptable accounting method
122Contribution margin can be defined as
- Athe amount of sales revenue necessary to cover variable costs
- Bsales revenue minus fixed costs
- Cthe amount of sales revenue necessary to cover fixed and variable costs
- Dsales revenue minus variable costs
123If prices were declining and you wanted to minimize tax payments, which inventory method would you use?
- ALIFO
- BFIFO
- Cweighted average
- Dspecific identification
124Gerrard Company is determining ending merchandise inventory. Which of the following items should be included?
- Aan inventory of office supplies such as pens and paper clips
- Bgoods purchased FOB destination for resale and not yet arrived yet
- Cgoods sold to customers FOB destination and now enroute to customers
- Da group of used cash registers no longer used by the store and awaiting sale
125Which of the following would cause the breakeven point to change?
- Asales increased
- Btotal production decreased
- Ctotal variable costs increased as a function of higher production
- Dfixed costs increased due to addition to physical plant
126If all other factors remain the same, a 20% increase in both the selling price and variable expense of a product will
- Alower the company's breakeven point in units
- Braise the company's breakeven point in units
- Chave no effect on the company's breakeven point in units
- Dcannot be determined without more information
127Which of the following effects occur when inventory is sold?
- Aa liability and an asset both increase
- Ba revenue and liability both decrease
- Can asset increases and a liability decreases
- Dan expense increases and a liability decreases
- Ean asset and a revenue both increase
128Advertising expense is a
- Aproduct cost - yes
period cost - yes - Bproduct cost - yes
period cost - no - Cproduct cost - no
period cost - yes - Dproduct cost - no
period cost - no
- Aproduct cost - yes
129Product costs
- Anever appear on the income statement
- Binclude direct costs only
- Ccan appear on the balance sheet
- Dnever appear on the balance sheet
130Which of the following strategies would lower a company's breakeven point?
- Araise the sale price
- Blower the variable costs
- Clower the fixed costs
- Dall of the above
Informationen
- Beschreibung
- A200 Final, IU Spring 2015
- Autor
- Natalie Rook
- Sprache
- English
- Aufrufe
- 163
- Schlagwörter
- Bewertung
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