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topics 4

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202 accounting Quiz on topics 4, created by stevensae on 04/05/2015.
stevensae
Quiz by stevensae, updated more than 1 year ago
stevensae
Created by stevensae about 9 years ago
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Resource summary

Question 1

Question
The purpose of a flexible budget is to:
Answer
  • remove items from performance reports that are not controllable by managers.
  • permit managers to reduce the number of unfavorable variances that are reported.
  • update the static planning budget to reflect the actual level of activity of the period.
  • reduce the amount of conflict between departments when the master budget is prepared

Question 2

Question
A static budget:
Answer
  • should be compared to actual costs to assess how well costs were controlled.
  • should be compared to a flexible budget to assess how well costs were controlled
  • is valid for only one level of activity.
  • represents the best way to set spending targets for managers

Question 3

Question
In computing the margin in a ROI analysis, which of the following is used?
Answer
  • Sales in the denominator
  • Net operating income in the denominator
  • Average operating assets in the denominator
  • Residual income in the denominator

Question 4

Question
Which of the following will not result in an increase in the residual income, assuming other factors remain constant?
Answer
  • An increase in sales
  • An increase in the minimum required rate of return
  • A decrease in expenses
  • A decrease in operating assets

Question 5

Question
All other things the same, which of the following would increase residual income?
Answer
  • Increase in average operating assets
  • Decrease in average operating assets
  • Increase in minimum required return
  • Decrease in net operating income

Question 6

Question
Which of the following three statements are correct?
Answer
  • A profit center has control over both cost and revenue
  • An investment center has control over invested funds, but not over costs and revenue
  • A cost center has no control over sales.

Question 7

Question
The purpose of the Data Processing Department of Falena Corporation is to assist the various departments of the corporation with their information needs free of charge. The Data Processing Department would best be evaluated as a:
Answer
  • Cost center
  • Revenue center
  • profit center
  • investment center

Question 8

Question
Actual Revenues > Budgeted Revenues
Answer
  • Favorable
  • Unfavorable

Question 9

Question
Actual Revenues < Budgeted Revenues
Answer
  • Favorable
  • Unfavorable

Question 10

Question
Actual Expenses > Budgeted Expenses
Answer
  • Favorable
  • Unfavorable

Question 11

Question
Actual Expenses < Budgeted Expenses
Answer
  • Favorable
  • Unfavorable

Question 12

Question
For Costs:
Answer
  • (+)Unfavorable (-) Favorable
  • (-)Unfavorable (+)Favorable

Question 13

Question
For Sales:
Answer
  • (+)favorable (-)unfavorable
  • (-)favorable (+)unfavorable

Question 14

Question
Final, delivered cost of materials, net of discounts
Answer
  • Price Standards
  • Quality Standards

Question 15

Question
Use product design specifications
Answer
  • Price Standards
  • Product standards
  • Rate Standards
  • Activity Standards

Question 16

Question
Use wage surveys and labor contracts
Answer
  • Rate Standards
  • Time Standards
  • Quality Standards
  • Price Standards

Question 17

Question
Use time and motion studies for each labor operation
Answer
  • Time standards
  • Rate standards
  • Activity Standards
  • Price standards

Question 18

Question
The activity is the base used to calculate the POH
Answer
  • Activity Standards
  • Rate standards
  • Price standards
  • Quality Standards

Question 19

Question
Which variance involves the quantity purchased?
Answer
  • Price Variance
  • Quantity Variance

Question 20

Question
Which variance involves quantity used?
Answer
  • Price Variance
  • Quantity variance

Question 21

Question
Who is generally responsible for rate variances?
Answer
  • Production Managers
  • Purchasing Managers
  • General Managers

Question 22

Question
Segment whose manager has control over both costs and revenues, but no control over investment funds.
Answer
  • Cost Center
  • Profit Center
  • Investment Center

Question 23

Question
Segment who's manager has control over costs, revenues, and investments in operating assets
Answer
  • Cost Center
  • Profit Center
  • Investment Center

Question 24

Question
The Cost, Profit and Investment Centers all fall under what Center
Answer
  • Responsibility
  • Managerial
  • Planning
  • Budgeting

Question 25

Question
Income before interest and taxes
Answer
  • Net operating income
  • real income
  • average operating assets
  • none of the above

Question 26

Question
What falls under "average operating assets"
Answer
  • Cash
  • Accounts Recievable
  • Inventory
  • Plant & Equipment
  • Income
  • Revenues

Question 27

Question
ROI=
Answer
  • Net operating income/average operating income
  • Average operating income/net operating income
  • Sales/net operating income
  • average operating income/sales
  • Margin x Turnover

Question 28

Question
What are 3 ways to improve ROI
Answer
  • Increase Sales
  • Reduce Expenses
  • Reduce assets
  • Decrease sales
  • Increase assets

Question 29

Question
Margin=
Answer
  • Net operating income/average operating assets
  • sales/assets
  • Net operating income/sales
  • Average operating assets/sales

Question 30

Question
Turnover=
Answer
  • Net operating income/average operating assets
  • Sales/net operating income
  • average operating assets/sales
  • sales/average operating assets
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