Accounting Expert Answers & Study Resources : Page 56

21.Balance sheet disclosures for preferred stock include all of the following except:   A. The number of shares issued. B. The number of shares outstanding. C. The liquidating or redemption value. D. The credit or market value. E. The number of shares authorized. 22.The declaration date pertains to:   A. The date used to determine who receives dividends. B. The date on which the board of directors.

21.When a company issues a bond at a premium:   A. the company is more profitable than most companies in its industry. B. investors perceive the bond to be a very safe investment. C. the company's interest expense will be less than the interest paid each year. D. the company's interest expense will be more than the interest paid.

Multiple Choice Questions1.________________ is a technique used to filter cost information contained in performance reports to each manager within the organization at an appropriate level of detail or summarization:   A. Managerial reporting B. Responsibility reporting C. Financial reporting D. Segment reporting 2.The term noncontrollable cost:   A. implies that there is really nothing the manager can do to influence the amount of.

11.The total variance for any particular cost component is referred to as the:   A. price variance. B. efficiency variance. C. budget variance. D. none of these. 12.The total budget variance is caused by two factors:   A. quantity and price. B. time and materials. C. direct and indirect relationships. D. fixed and variable cost behavior. 13.A variance is the difference between actual costs and:   A. selling price. B. expected costs. C. activity-based costs. D. historical costs. 14.The difference.

31.Southern Company's accountant failed to accrue as of 12/31/13 some employee fringe benefit program expenses that were incurred in 2013 and that will be paid in 2014. The result of this omission is to:   A. overstate the current ratio at 12/31/13 and overstate ROI and ROE for the year ended 12/31/13. B. overstate the.

11.The earnings per share of common stock calculation:   A. is made by dividing net income by the number of shares of common stock outstanding at the end of the year. B. is complicated by the declaration of cash dividends during the year. C. includes gains or losses from treasury stock transactions. D. is complicated by the presence of.

31.The balance sheet caption for common stock is:Common stock, $10 par value, 7,000,000 shares authorized, 5,700,000 shares issued, 5,500,000 shares outstanding.(a.) Calculate the dollar amount that will be presented opposite of this caption.(b.) Calculate the total amount of a cash dividend of $1.00 per share.(c.) What accounts for the difference.

21.If they are to be useful to managers, variances should be reported:   A. simultaneously to all managers within a week after the end of the month. B. in dollar amounts as soon as all costs are known. C. in physical terms or dollar amounts as promptly as feasible. D. in physical terms and dollar amounts if the variance.

Multiple Choice Questions 1.The method of evaluating financial data that change under different courses of action is called:   A. financial statement analysis. B. break-even analysis. C. incremental analysis. D. cost-benefit analysis. 2.Braizen, Inc. produces a product with a $30 per-unit variable cost and an $80 per-unit sales price. Fixed manufacturing overhead costs are $100,000. The firm has a one-time opportunity.

21.  The present value of $3,000 to be received every year for 9 years, at 10%, is:   A. $7,073.80. B. $12,273.00. C. $17,277.00. D. $27,000.00. 22.  The present value of an obligation of $4,000 payable in 7 years at 8% is:   A. $1,760. B. $2,334. C. $3,206. D. $3,680. 23.  A particular common stock has an annual cash dividend of $2.00 per share and is predicted to have a market value.

11.The relevant range concept refers to:   A. a firm's range of profitability. B. a firm's range of sales. C. a firm's range of rates of return. D. a firm's range of activity. 12.Which of the following is another term for mixed costs?   A. Semifixed costs. B. Semivariable costs. C. Component costs. D. None of these. 13.As the total volume of activity changes:   A. the total of variable costs changes. B. the total.

11.Current maturities of long-term debt:   A. reflect overdue installments of bonds payable. B. are classified with long-term debt. C. represent cash that has been set aside for debt payments due within a year. D. permit a more accurate determination of working capital. 12.The purpose of reporting Current Maturities of Long-Term debt is to:   A. report any portion of a long-term borrowing.

11.Product costs are inventoried and treated as assets until:   A. the next accounting period. B. related liabilities no longer exist. C. the period in which the products they relate to are sold. D. none of these. 12.In the T-account cost flow diagram of balance sheet inventory accounts and the income statement cost of goods sold account:   A. raw materials purchases are.

31.When the present value analysis of a proposed investment results in an indication that the proposal has a rate of return greater than the cost of capital, the investment might not be made because:   A. the quantitative analysis indicates that it should not be made. B. management's assessment of qualitative factors overrides the quantitative.

11.Moped, Inc. purchased machinery at a cost of $22,000 on January 1, 2014. The expected useful life is 5 years and the asset is expected to have salvage value of $2,000. Moped depreciates its assets using the double-declining balance method.What is the accumulated depreciation for this asset on December 31,.

11.The key data element on which the entire budget is based is the:   A. sales/revenue forecast. B. income statement budget. C. cash budget. D. balance sheet forecast. 12.The operating budget depends on key information developed in the:   A. cash forecast. B. sales forecast. C. labor forecast. D. operating forecast. 13.The production budget uses all of the following except:   A. the sales forecast. B. the inventory policy. C. the cash receipts budget. D. the beginning inventory quantity. 14.A.

41.The contribution margin format income statement is organized by:   A. responsibility centers. B. functional classifications. C. sales territories. D. cost behavior classifications. 42.A 10% change in a firm's revenues is likely to result in a change of more than 10% in the firm's operating income because:   A. not all of the firm's costs will change in proportion to the revenue change. B. the.

51.The contribution margin ratio always decreases when the:   A. break-even point decreases. B. fixed expenses increase. C. selling price increases and the variable costs remain constant. D. variable cost increase and the selling price remains constant. 52.If fixed costs were increased by $9,000 and the contribution margin ratio remained at 30 percent, then sales must increase by _________ in.

11.Retained earnings represents:   A. cash that is available for dividends. B. the total net income of the firm since its beginning. C. cumulative net income of the firm since its beginning that has not been distributed to its stockholders in the form of dividends. D. net income plus gains (or minus losses) on treasury stock transactions. 12.Preferred stock is.

31.Regardless of the inventory cost flow assumption used, inventories on the balance sheet are stated at:   A. original cost. B. realizable value. C. replacement cost. D. the lower of cost or market. 32.Prepaid expenses classified as current assets represent:   A. current year expenses that have been accrued. B. current year cash payments that will be matched against revenues of the next year or.

Multiple Choice Questions 1.When a firm buys land on which there is a building, and the building is torn down so that an appropriate new building can be constructed on the land:   A. any of the purchase cost allocated to the old building is reported as a loss. B. the cost assigned to the.

Multiple Choice Questions 1.The first caption in most income statements in annual reports is:   A. gross sales. B. net sales. C. earned revenues. D. sales, less sales returns and allowances. 2.Gains differ from revenues because gains:   A. are not a result of the entity's ongoing, central operations. B. do not have to be realized. C. are reported as income from operating activities. D. do not involve any offsetting.

21.As the level of activity decreases:   A. fixed cost per unit decrease. B. variable cost per unit decrease. C. fixed cost remains constant in total. D. variable cost remains constant in total. 22.An example of a cost that is likely to have a variable behavior pattern is:   A. sales force salaries. B. depreciation of production equipment. C. salaries of production supervisors. D. production labor wages. 23.An example of.

11.The impact of changing price levels on amounts reported in financial statements is:   A. reported as a separate item on the balance sheet. B. accomplished by reporting assets at their replacement cost. C. required to be described in the notes to the financial statements. D. encouraged, but not required to be described in the notes to the financial.

Multiple Choice Questions 1.A transaction that is likely to cause an increase in a current liability is:   A. payment of accrued wages. B. accrual of interest expense. C. depreciation of equipment. D. accrual of bad debts expense. 2.The payment of a current liability will:   A. decrease net income. B. decrease working capital. C. increase working capital. D. not affect working capital. 3.A working capital loan will generally:   A. not have an.

41.The cost formula for the maintenance department of the Eifel Co. is $6,500 per month plus $3.50 per machine hour used by the production department.a. Calculate the maintenance cost that would be budgeted for the month of May in which 5,700 machine hours are planned to be used.b. Prepare an.

Multiple Choice Questions 1.Corporate governance includes concerns about:   A. business ethics and social responsibility. B. the responsibilities of the board of directors. C. equitable treatment of all stakeholders. D. disclosures and transparency. E. all of these. 2.The most powerful corporate governance legislation to date has been:   A. the Sarbanes-Oxley Act (SOX) of 2002. B. the creation of the American Institute of Certified Public Accountants. C. Corporate Ethics.

21.The term, "earned," in revenue recognition refers to which of the following?   A. The entity has completed, or substantially completed, the activities it must perform to be entitled to the revenue benefits. B. The product or service has been exchanged for cash, claims to cash, or an asset that is readily convertible to a.

11.Bad debt expense is recognized in the same accounting period as the revenue that is related to the receivable because:   A. the accounts receivable asset should be stated at original cost. B. the exact amount of the losses from bad debts is known. C. revenues should be stated at realizable value. D. all costs incurred in the current.

21.Which of the following is a plan for acquiring the resources needed to complete the manufacturing activities that will satisfy the organization's sales forecast?   A. Sales budget. B. Raw materials budget. C. Production budget. D. Direct labor budget. 22.Which of the following lists the components of the master budget in correct chronological order?   A. Direct labor budget, production budget, cost of.

Multiple Choice Questions 1.The term "cost" means:   A. the price paid for a raw material. B. the wage paid to a worker. C. the price charged by an entity for its services. D. all of these. 2.Cost accounting is primarily concerned with:   A. accumulation and determination of product or service cost. B. income measurement and inventory valuation. C. generally accepted accounting principles. D. all of these. 3.Which of the.

11.The dividend payout ratio describes:   A. the proportion of earnings paid as dividends. B. the relationship of dividends per share to market price per share. C. the percentage change in dividends this year compared to last year. D. dividends as a percentage of the price/earnings ratio. 12.The price/earnings ratio:   A. is a measure of the relative expensiveness of a firm's common.

31.The three sections of a statement of cost of goods manufactured include:   A. raw material, direct labor, manufacturing overhead. B. variable expenses, contribution margin, fixed expenses. C. sales revenue, gross profit, selling and administrative expenses. D. direct costs, indirect costs, operating profit. 32.Which of the following items would not be reported on the statement of cost of goods manufactured?   A. cost.

31.A cash budget would not include:   A. sale of common stock. B. payment of dividends. C. payment of property taxes. D. plant and building depreciation. 32.A key to estimating an accurate amount of cash to be collected from sales is:   A. the accuracy of the sales forecast. B. the accuracy of the estimated collection patterns for sales. C. both the accuracy of the sales forecast.

Multiple Choice Questions 1.Which of the following is not a right or attribute of common stock ownership?   A. Electing directors. B. Liability limited to amount invested. C. Approving changes in corporate charter. D. Determining dividend policy. 2.Which of the terms is not used to identify owners' equity or stockholders' equity?   A. Partner's capital. B. Proprietor's capital. C. Paid-in-capital and retained earnings. D. Additional-paid-in-retained earnings. 3.Which of the following.

Multiple Choice Questions 1.Managerial accounting supports the management process most significantly by:   A. measuring and reporting financial results after the fact. B. determining the goals and objectives of the entity. C. providing estimates of financial results for various plans. D. establishing operating policies to be followed during a period of time. 2.Activities included in a generally accepted definition of management.

21.Product X sells for $80 per unit in the marketplace and ABC Company requires a 35% minimum profit margin on all product lines. In order to compete in this market, the target cost for Product X must be equal to or lower than:   A. $28. B. $45. C. $52. D. $80. 22.Which of the following costs are not relevant.

41.The use of activity-based costing information to support the decision-making process is known as:   A. value chain analysis. B. cost distortion analysis. C. activity-based management. D. cost-based management. Essay Questions 42.For each of the following costs, check the columns that most likely apply.     43.Webster World Products uses the following account titles:  For each transaction described below, indicate which accounts would be debited.

Multiple Choice Questions 1.An example of a committed cost is:   A. employee training. B. manufacturing supplies. C. real estate taxes. D. charitable contributions. 2.Which of the following is not a strong reason for budgeting?   A. Budgets provide a benchmark for judging performance. B. Budgeting requires little effort by non-accounting managers. C. Budgeting requires management to plan. D. Budgeting requires coordination among the functional areas of the firm. 3.The budgeting.

21.The principal reason for converting a customer's account receivable to a note receivable is:   A. the note receivable earns interest and the account receivable does not. B. the receivable is less likely to have to be written off as uncollectible. C. working capital is immediately increased. D. the customer is more likely to continue purchasing the company's products. 22.The.

41.The concept of a standard used for planning and control purposes is most like a:   A. measure of ideal performance. B. unit budget. C. measure of maximum efficiency. D. measure of historical performance. 42.Standards are most appropriately used to:   A. reward workers and managers who meet them. B. penalize workers and managers who do not meet them. C. calculate the unit cost of a product.

21.The three components of product costs are:   A. direct material, supervisor salaries, selling expenses. B. direct labor, manufacturing overhead, indirect material. C. direct material, direct labor, manufacturing overhead. D. manufacturing overhead, indirect material, indirect labor. 22.Which of the following is NOT an inventory account for a manufacturing company?   A. Cost of goods sold. B. Work-in-process. C. Raw materials. D. Finished goods. 23.Which of the following is NOT an.

Multiple Choice Questions 1.The current assets of most companies are usually made up of:   A. assets that are currently used in the operations of the company. B. cash and assets expected to be converted to cash within a year. C. a very small proportion (less than 10%) of the total assets of the entity. D. cash, marketable securities, and.

31.How is performance evaluated for a cost center?   A. Actual costs incurred compared to budgeted costs. B. Actual segment margin compared to budgeted segment margin. C. Comparison of actual and budgeted return on investment (ROI) based on segment margin and assets controlled by the segment. D. None of these. 32.How is performance evaluated for a profit center?   A. Actual costs incurred.

11.Relevant costs in decision-making:   A. are future costs that represent differences between decision alternatives. B. result from past decisions. C. should not influence the decision. D. None of these. 12.A cost is considered relevant if:   A. it is positive. B. it is sunk. C. it makes a difference. D. if it can't be changed. 13.If a cost is irrelevant to a decision, the cost could not be a:   A. fixed.

61.Presented below is the income statement for Ackee Food Center for the month of July:  Based on an analysis of cost behavior patterns, it has been determined that the company's contribution margin ratio is 15 percent.(a.) Rearrange the above income statement to the contribution margin format.(b.) If sales increase by 10.

51.Pacesetters, Inc., has actual sales for July and August and forecasted sales for September, October, November, and December as follows:  (a.) The firm's policy is to have finished goods inventory on hand at the end of the month that is equal to 70 percent of the next month's sales. It is.

31.To which function of management is CVP analysis most applicable?   A. Planning. B. Organizing. C. Directing. D. Controlling. 32.The scattergram allows cost-volume relationships to be visually scanned for outlier observations that should be:   A. included in the calculation of the cost formula of a mixed cost. B. ignored in the calculation of the cost formula of a mixed cost. C. included in the calculation of.

41.Claudette, Inc., provides warranties for many of its products. The January 1, 2014, balance of the Estimated Warranty Liability account was $38,500. Based on an analysis of warranty claims during the past several years, this year's warranty provision was estimated to be 0.8 percent of sales. During 2014, the actual.

41.The reason for recording a prepaid expense as a current asset is:   A. that the prepaid item will be returned for a cash refund. B. that the prepaid item has not yet become an expense. C. that the expense has been incurred but not yet paid. D. to avoid recognizing an expense so net income will be higher.