ACC 561 NEW ENTIRE COURSE,ACC 561 NEW ENTIRE CLASS,ACC 561 NEW TUTORIAL,ACC 561 NEW ASSIGNMENT Flashcards
ACC 561 Assignment: Week 1 Practice Quiz
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Multiple Choice Question 41
The proprietorship form of business organization
combines the records of the business with the personal records of the owner.
is classified as a separate legal entity.
must have at least two owners in most states.
generally receives favorable tax treatment relative to a corporation.
Multiple Choice Question 45 Most business enterprises in the United States are government units. partnerships. proprietorships and partnerships corporations.
Multiple Choice Question 46 A business organized as a separate legal entity is a government unit. partnership. corporation. proprietor.
Multiple Choice Question 57
Which of the following is the best definition of an internal user of accounting information?
Creditors like banks that use accounting information to evaluate the risk of lending money.
Managers who use accounting information to plan, organize, and run a business.
Labor unions who use accounting information to examine the ability of the company to pay increased wages and benefits.
Investors who use accounting information to decide whether to buy or sell stock.
Multiple Choice Question 63
Which of the following groups uses accounting information primarily to insure the entity is operating within prescribed rules? Labor Unions Management Taxing authorities Regulatory agencies
Multiple Choice Question 65 Which of the following groups uses accounting information to determine whether the company can pay its obligations? Chief Financial Officer Creditors Investors in common stock Marketing managers
Multiple Choice Question 99
Which of the following financial statements is divided into major categories of operating, investing, and financing activities? The retained earnings statement. The statement of cash flows. The income statement. The balance sheet.
Multiple Choice Question 101
Ending retained earnings for a period is equal to:
Beginning retained earnings – Net income – Dividends
Beginning retained earnings + Net income – Dividends
Beginning retained earnings – Net income + Dividends
Beginning retained earnings + Net income + Dividends
Multiple Choice Question 105 The financial statement that summarizes the changes in retained earnings for a specific period of time is the balance sheet. statement of cash flows. income statement. retained earnings statement.
Multiple Choice Question 106 To show how successfully your business performed during a period of time, you would report its revenues and expense in the balance sheet. statement of cash flows. income statement. retained earnings statement.
Multiple Choice Question 116 Which financial statement is prepared first? Statement of cash flows Balance sheet Income statement Retained earnings statement
Multiple Choice Question 117
An income statement shows
revenues, expenses, and net income.
assets, liabilities, and stockholders’ equity.
expenses, dividends, and stockholders’ equity.
revenues, liabilities, and stockholders’ equity.
Multiple Choice Question 103
Dawson Corporation has the following information available for 2011:
(in millions)
Issued common stock $45
Retired common stock $65
Paid dividends $75
Net income $130
Beginning common stock balance $575
Beginning retained earnings balance $425
Based in this information, what is Dawson's Common Stock balance at the end of the year?
$685
$195
$630
$555
Multiple Choice Question 109
Declaring a cash dividend will
decrease retained earnings.
increase common stock.
decrease common stock.
increase retained earnings.
Multiple Choice Question 113 At December 31, 2012 Lowery Company had retained earnings of $2,184,000. During 2012 they issued stock for $98,000, and paid dividends of $34,000. Net income for 2012 was $402,000. The retained earnings balance at the beginning of 2012 was: $2,454,000 $1,914,000 $2,552,000 $1,816,000
Multiple Choice Question 158 Which of the following organizations issues accounting standards for countries outside the United FASB IASB SEC GAAP
Multiple Choice Question 159
have eliminated all errors in accounting.
are accounting rules that are recognized as a general guide for financial reporting.
are accounting rules formulated by the Internal Revenue Service.
are sound in theory but rarely used in real life.
Multiple Choice Question 160
The agency of the United States Government that oversees the U.S. financial markets is the
Financial Accounting Standards Board.
Internal Revenue Service
Security Exchange Commission
International Auditing Standards Committee.
Multiple Choice Question 161
What organization issues U.S. accounting standards?
International Accounting Standards Committee.
International Auditing Standards Committee.
Financial Accounting Standards Board.
Security Exchange Commission.
Multiple Choice Question 164 Two of the major characteristics that make accounting information useful are Relevance and Faithful representation. Comparability and flexibility. Understandability and consistency. Verifiability and timeliness.
Multiple Choice Question 171 If accounting information has relevance, it is useful in making predictions about future IRS audits. foreign currency exchange rates. the future events of a company. new accounting principles. Final Guide For more classes visit www.acc561assignment.com
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Brief Exercise 1-7
Indicate which statement you would examine to find each of the following items: income statement, balance sheet, retained earnings statement, or statement of cash flows.
Revenue during the period.
Supplies on hand at the end of the year.
Cash received from issuing new bonds during the period.
Total debts outstanding at the end of the period.
Brief Exercise 1-8
Use the basic accounting equation to answer these questions.
(a) The liabilities of Daley Company are $94,410 and the stockholders’ equity is $241,000. What is the amount of Daley Company’s total assets?
Total assets
(b) The total assets of Laven Company are $181,800 and its stockholders’ equity is $84,800. What is the amount of its total liabilities?
Total liabilities
(c) The total assets of Peterman Co. are $910,600 and its liabilities are equal to one fourth of its total assets. What is the amount of Peterman Co.’s stockholders’ equity?
Stockholders’ equity
Final Guide
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ACC 561 Week 1 Financial Statement Review
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Option 1:
1. Select an American corporation.
2. Visit its website and download the Income Statement, Statement of Stockholders Equity, Balance Sheet, and Statement of Cash Flows.
3. Complete the University Material: Financial Statement Review Worksheet.
4. Submit the completed worksheet, copies of the downloaded financial statements, and a link to the website. Include all your calculations if applicable.
5. Click the Assignment Files tab to submit your assignment.
Option 2:
1. Create a table that lists each type of financial statements - income statement, balance sheet, cash flow statement and statement of equity under Column.
2. Add two columns. Column 2 should be labeled “Purpose” and Column 3 should be labeled “Users”.
3. Complete the table. Under Column 2 explain the purpose and content of each statement. Under Column 3 list the users of each and explain how they would use such statements.
4. Click the Assignment Files tab to submit your assignment.
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ACC 561 Week 1 Learning Team Charter
Please prepare and submit your Team Charter. Please note that the team charter should be a collaborative and cohesive document that lists all agreed upon team policies, not a presentation of “individual” opinions. You can access the template under the Learning Team Toolkit.
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ACC 561 Week 2 Assignment Practice Quiz 100%Correct
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Multiple Choice Question 115 The relationship between current assets and current liabilities is important in evaluating a company's Entry field with correct answer market value. solvency. profitability. liquidity.
Multiple Choice Question 116 Which of the following is a measure of liquidity? Debt to equity ratio Profit margin Working capital Earnings per share
Multiple Choice Question 117 Current assets divided by current liabilities is known as the capital structure. working capital current ratio. profit margin.
Multiple Choice Question 88
Danner Corporation reported net sales of $600,000, $680,000, and $800,000 in the years 2011, 2012, and 2013, respectively. If 2011 is the base year, what percentage do 2013 sales represent of the base?
33%
133%
75%
113%
Multiple Choice Question 89 In analyzing financial statements, horizontal analysis is a theory. requirement. tool. principle.
Multiple Choice Question 101
Comparative balance sheets
are usually prepared for at least one year.
are usually prepared for at least two years.
do not show both dollar amount and percentage changes.
do not show a comparison of total stockholders’ equity.
Multiple Choice Question 102
Assume the following cost of goods sold data for a company: 2013 $1,500,000 2012 1,200,000 2011 1,000,000 If 2011 is the base year, what is the percentage increase in cost of goods sold from 2011 to 2013? 50% 67% 150% 20%
Multiple Choice Question 105
Comparisons of data within a company are an example of the following comparative basis: Intercompany. Interregional. Industry averages. Intracompany.
Multiple Choice Question 123
The following schedule is a display of what type of analysis?
Amount Percent
Current assets $100,000 25%
Property, plant, and equipment 300,000 75%
Total assets $400,000 100%
Horizontal analysis
Differential analysis
Vertical analysis
Ratio analysis
Multiple Choice Question 129
A common measure of profitability is the current ratio. debt to total assets. current cash debt coverage ratio. return on common stockholders' equity ratio.
Multiple Choice Question 134 Which one of the following would be considered a long-term solvency ratio? Return on total assets Current cash debt coverage ratio Debt to total assets ratio Receivables turnover
Multiple Choice Question 137
The current ratio is
calculated by dividing current liabilities by current assets.
used to evaluate a company’s liquidity and short-term debt paying ability.
used to evaluate a company’s solvency and long-term debt paying ability.
calculated by subtracting current liabilities from current assets.
Multiple Choice Question 121
Richards, Inc. has the following income statement (in millions): RICHARDS, INC. Income Statement For the Year Ended December 31, 2012 Net Sales $180 Cost of Goods Sold 60 Gross Profit 120 Operating Expenses 75 Net Income $ 45 Using vertical analysis, what percentage is assigned to net income?
A.100%
B.75%
C.25%
D.None of the above.
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ACC 561 Week 2 Individual Ratio Analysis Assignment
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Please go to Yahoo Finance (finance.yahoo.com).
Under the “Quote Lookup” please search for Kellogg Company.
On the left bar you will be able to access the Income Statement and Balance Sheet for the company.
Option 1:
Calculate the current ratio, profit margin and debt/equity ratio. Explain your interpretation of each.
Option 2:
Prepare a 500-word paper that responds to the following questions (please use a question / answer format):
1. Has the profit increased or decreased from 2012 to 2013 and by how much?
2. What is the percentage increase or decrease in selling general and administrative expenses?
3. What is the percentage increase or decrease in net income?
4. Based on your answers above, what conclusion can you draw regarding the firm’s financial performance?
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ACC 561 Week 2 Learning Team Assignment
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Prepare a table, chart or mind map comparing and contrasting ratio, horizontal, vertical and comparative analysis.
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ACC 561 Week 3 Assignment Practice Quiz
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Multiple Choice Question 37
A major purpose of cost accounting is to
measure, record, and report product costs.
classify all costs as operating or nonoperating.
measure, record, and report period costs.
provide information to stockholders for investment decisions
Multiple Choice Question 38 The two basic types of cost accounting systems are job order and process cost systems. job order and batch systems. process cost and batch systems. job order and job accumulation systems.
Multiple Choice Question 39 A process cost system would most likely be used by a company that makes breakfast cereal. motion pictures. college graduation announcements. repairs to automobiles.
Multiple Choice Question 40
Which of the following would be accounted for using a job order cost system?
The refining of petroleum.
The production of automobiles.
The production of personal computers.
The construction of a new campus building.
Multiple Choice Question 45
The flow of costs in a job order cost system
measures product costs for a set time period.
generally follows a LIFO cost flow assumption.
involves accumulating manufacturing costs incurred and assigning the accumulated costs to work done.
cannot be measured until all jobs are complete.
Multiple Choice Question 60
The entry to record the acquisition of raw materials on account is
Raw Materials Inventory
Accounts Payable
Work in Process Inventory
Accounts Payable
Manufacturing Overhead
Raw Materials Inventory
Accounts Payable
Accounts Payable
Raw Materials Inventory
Multiple Choice Question 73 Time tickets should be approved by the payroll department. the audit committee. co-workers. the employee's supervisor.
Multiple Choice Question 89 The labor costs that have been identified as indirect labor should be charged to salary expense. manufacturing overhead. the individual jobs worked on. direct labor.
Multiple Choice Question 90
Manufacturing overhead is applied to each job
at the time when the overhead cost is incurred.
by means of a predetermined overhead rate.
only if the overhead costs can be directly traced to that job.
at the end of the year when actual costs are known.
Multiple Choice Question 38
A process cost accounting system is most appropriate when
individual products are custom made to the specification of customers.
a variety of different products are produced, each one requiring different types of materials, labor, and overhead.
the focus of attention is on a particular job or order.
similar products are mass-produced.
Multiple Choice Question 43
Which of these best reflects a distinguishing factor between a job order cost system and a process cost system?
The time period each covers.
The number of work in process accounts.
The manufacturing cost elements included.
The detail at which costs are calculated.
Multiple Choice Question 47 In process cost accounting, manufacturing costs are summarized on a manufacturing cost sheet. process order cost sheet. job order cost sheet. production cost report.
Multiple Choice Question 49 In a process cost system, product costs are summarized: on job cost sheets. on production cost reports. when the products are sold. after each unit is produced.
Multiple Choice Question 136
Which of the following is considered a difference between a job order cost and a process cost system?
Documents used to track costs.
The manufacturing cost elements.
The accumulation of the costs of materials, labor, and overhead.
The flow of costs.
Multiple Choice Question 35
The costs that are easiest to trace directly to products are
A.direct materials and direct labor.
B.direct labor and overhead.
C.direct materials and overhead.
D.None of the above; all three costs are equally easy to trace to the product.
Multiple Choice Question 36 Often the most difficult part of computing accurate unit costs is determining the proper amount of \_\_\_\_\_\_\_\_\_ to assign to each product, service, or job. direct materials overhead direct materials and direct labor direct labor
Multiple Choice Question 49
The last step in activity-based costing is to
compute the activity-based overhead rate per cost driver.
identify the cost driver that has a strong correlation to the activity cost pool.
identify and classify the major activities involved in the manufacture of specific products.
assign manufacturing overhead costs for each activity cost pool to products.
Multiple Choice Question 50
The first step in activity-based costing is to
compute the activity-based overhead rate per cost driver.
identify the cost driver that has a strong correlation to the activity cost pool.
identify and classify the major activities involved in the manufacture of specific products.
assign manufacturing overhead costs for each activity cost pool to products.
Multiple Choice Question 51
A well-designed activity-based costing system starts with
assigning manufacturing overhead costs for each activity cost pool to products.
computing the activity-based overhead rate.
analyzing the activities performed to manufacture a product.
identifying the activity-cost pools.
Multiple Choice Question 53
An example of an activity cost pool is
machine hours.
setting up machines.
number of setups.
number of inspections.
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Brief Exercise 13-4
Using these data from the comparative balance sheet of Rosalez Company, perform horizontal analysis. (If amount and percentage are a decrease show the numbers as negative, e.g. -55,000, -20% or (55,000), (20%). Round percentages to 0 decimal places, e.g. 12%.)
Increase or (Decrease)
Dec. 31, 2012 Dec. 31, 2011 Amount Percentage
Accounts receivable $ 488,200 $ 360,000
Inventory $ 818,100 $ 601,200
Total assets $3,173,600 $2,774,300
Brief Exercise 13-5
Using these data from the comparative balance sheet of Rosalez Company, perform vertical analysis. (Round percentages to 1 decimal place, e.g. 12.5%.)
Dec. 31, 2012 Dec. 31, 2011
Amount Percentage Amount Percentage
Accounts receivable $ 544,700
$ 393,300
Inventory $ 804,600
$ 609,700
Total assets $3,137,000
$2,763,400
Brief Exercise 13-8 (Essay)
Vertical Analysis 2012 2011 2010
Sales 100 % 100 % 100 %
Cost of goods sold 61.2 64.6 65.7
Expenses 24.8 26.3 28.0
Vertical analysis (common-size) percentages for Vallejo Company’s sales, cost of goods sold, and expenses are listed here.
Did Vallejo’s net income as a percent of sales increase, decrease, or remain unchanged over the 3-year period? Provide numerical support for your answer.
Brief Exercise 13-9 (Essay)
Horizontal analysis (trend analysis) percentages for Spartan Company’s sales, cost of goods sold, and expenses are listed here.
Horizontal Analysis 2012 2011 2010
Sales 96.2 % 104.8 % 100.0 %
Cost of goods sold 101.0 98.0 100.0
Expenses 105.6 95.4 100.0
Explain whether Spartan’s net income increased, decreased, or remained unchanged over the 3-year period.
Brief Exercise 13-15
Selected data taken from a recent year’s financial statements of trading card company Topps Company, Inc. are as follows (in millions).
Net sales $326.7
Current liabilities, beginning of year 41.1
Current liabilities, end of year 62.4
Net cash provided by operating activities 10.4
Total liabilities, beginning of year 65.2
Total liabilities, end of year 73.2
Capital expenditures 3.7
Cash dividends 6.2
Compute these ratios: current cash debt coverage ratio, cash debt coverage ratio, and free cash flow. Provide a brief interpretation of your results. (Round answers to 2 decimal places, e.g. 0.12.)
Current cash debt coverage ratio
Cash debt coverage ratio
Free Cash Flow
Brief Exercise 13-13
Staples, Inc. is one of the largest suppliers of office products in the United States. It had net income of $738.7 million and sales of $24,275.5 million in 2009. Its total assets were $13,073.1 million at the beginning of the year and $13,717.3 million at the end of the year. What is Staples, Inc.’s asset turnover ratio and profit margin ratio? (Round answers to 2 decimal places, e.g. 1.25 or 2.05%.)
Asset turnover ratio
Profit margin ratio
Brief Exercise 13-10
These selected condensed data are taken from recent balance sheets of Bob Evans Farms (in thousands).
2009 2008
Cash $ 13,606 $ 7,669
Accounts receivable 23,045 19,951
Inventories 31,087 31,345
Other current assets 12,522 11,909
Total current assets $ 80,260 $ 70,874
Total current liabilities $245,805 $326,203
Compute the current ratio for each year. (Round answers to 2 decimal places, e.g. .12 : 1.)
2009 2008
Current ratio:
Final Guide
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ACC 561 Week 3 Individual Costing Systems Assessment
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Please review the information for Parlex Corporation on Page 836, Chapter 15 of your textbook (under Activity BYP15-3).
Prepare a 1000-word paper or a 5-slide power point presentation that addresses the following questions:
(a) Parlex management discusses the job order cost system employed by their company. What are
several advantages of using the job order approach to costing? What are the disavantages of the system?
(b) Contrast the products produced in a job order environment, like Parlex, to those produced
when process cost systems are used.
(c) Would Parlex benefit from a hybrid system? Why or why not?
Final Guide
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ACC 561 Week 3 Learning Team Assignment
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Access BYP17-2 activity on Ideal Manufacturing (Page 935 of Chapter 17).
Complete the attached Excel spreadsheet.
Submit your completed excel spreadsheet using the Assignments Tab.
Final Guide
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ACC 561 Week 4 Assignment Practice Quiz
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Multiple Choice Question 39
A variable cost is a cost that
may or may not be incurred, depending on management’s discretion.
occurs at various times during the year.
varies in total in proportion to changes in the level of activity.
varies per unit at every level of activity.
Multiple Choice Question 42
An increase in the level of activity will have the following effects on unit costs for variable and fixed costs:
Unit Variable Cost Unit Fixed Cost
Increases Decreases
Remains constant Remains constant
Decreases Remains constant
Remains constant Decreases
Multiple Choice Question 43
A fixed cost is a cost which
remains constant per unit with changes in the level of activity.
remains constant in total with changes in the level of activity.
varies inversely in total with changes in the level of activity.
varies in total with changes in the level of activity.
Multiple Choice Question 86 Hollis Industries produces flash drives for computers, which it sells for $20 each. Each flash drive costs $14 of variable costs to make. During April, 1,000 drives were sold. Fixed costs for March were $2 per unit for a total of $1,000 for the month. How much is the contribution margin ratio? 80% 20% 30% 70%
Multiple Choice Question 87
Contribution margin
is calculated by subtracting total manufacturing costs per unit from sales revenue per unit.
equals sales revenue minus variable costs.
is always the same as gross profit margin.
excludes variable selling costs from its calculation.
Multiple Choice Question 100
The equation which reflects a CVP income statement is
Entry field with correct answer
Sales + Fixed costs = Variable costs + Net income.
Sales – Variable costs + Fixed costs = Net income.
Sales – Variable costs – Fixed costs = Net income.
Sales = Cost of goods sold + Operating expenses + Net income.
Multiple Choice Question 104 A company sells a product which has a unit sales price of $5, unit variable cost of $3 and total fixed costs of $150,000. The number of units the company must sell to break even is 50,000 units. 30,000 units. 75,000 units. 300,000 units.
Multiple Choice Question 93 Only direct materials, direct labor, and variable manufacturing overhead costs are considered product costs when using variable costing. absorption costing. product costing. full costing.
Multiple Choice Question 96
Under absorption costing and variable costing, how are fixed manufacturing costs treated?
Absorption Variable
Period Cost Period Cost
Product Cost Product Cost
Period Cost Product Cost
Product Cost Period Cost
Multiple Choice Question 121
Management may be tempted to overproduce when using
Entry field with correct answer
absorption costing, in order to increase net income.
absorption costing, in order to decrease net income.
variable costing, in order to increase net income.
variable costing, in order to decrease net income.
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Exercise 15-5
Duggan Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead costs are expected to total $277,640 for the year, and machine usage is estimated at 126,200 hours.
For the year, $291,977 of overhead costs are incurred and 130,300 hours are used.
(a) . Compute the manufacturing overhead rate for the year. (Round answers to 2 decimal places, e.g. 1.25.)
(b) What is the amount of under- or overapplied overhead at December 31?
(c) Prepare the adjusting entry to assign the under- or overapplied overhead for the year to cost of goods sold. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Exercise 16-3
ledger of Custer Company has the following work in process account.
Work in Process—Painting
5/1 Balance 3,870 5/31 Transferred out ?
5/31 Materials 6,750
5/31 Labor 4,800
5/31 Overhead 1,570
5/31 Balance ?
Production records show that there were 440 units in the beginning inventory, 30% complete, 1,510 units started, and 1,510 units transferred out. The beginning work in process had materials cost of $2,150 and conversion costs of $1,720. The units in ending inventory were 40% complete. Materials are entered at the beginning of the painting process.
(a) How many units are in process at May 31?
Work in process, May 31
units
(b) What is the unit materials cost for May? (Round unit costs to 2 decimal places, e.g. 2.25.)
The unit materials cost for May
(c) What is the unit conversion cost for May? (Round unit costs to 2 decimal places, e.g. 2.25.)
The unit conversion cost for May
(d) What is the total cost of units transferred out in May? (Round answer to 0 decimal places, e.g. 1,225.)
(e) What is the cost of the May 31 inventory? (Round answer to 0 decimal places, e.g. 1,225.)
Exercise 17-1
Wilkins Inc. has two types of handbags: standard and custom. The controller has decided to use a plantwide overhead rate based on direct labor costs. The president has heard of activity-based costing and wants to see how the results would differ if this system were used. Two activity cost pools were developed: machining and machine setup. Presented below is information related to the company’s operations.
Standard Custom
Direct labor costs $56,600 $114,000
Machine hours 1,230 1,470
Setup hours 100 380
Total estimated overhead costs are $308,300. Overhead cost allocated to the machining activity cost pool is $198,500, and $109,800 is allocated to the machine setup activity cost pool.
(a) Compute the overhead rate using the traditional (plantwide) approach. (Round answers to 2 decimal places, e.g. 12.25%.)
Predetermined overhead rate
% of direct labor cost
(b) Compute the overhead rates using the activity-based costing approach. (Round answers to 2 decimal places, e.g. $12.25.)
Machining $
per machine hour
Machine setup $
per setup hour
(c) Determine the difference in allocation between the two approaches. (Round answers to 0 decimal places, e.g. $1,225.)
Traditional costing
Standard $
Custom $
Activity-based costing
Standard $
Custom $
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ACC 561 Week 4 Learning Team Reflection
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Managerial accounting is all about making informed decisions. Cost-volume-profit (CVP) analysis is one of the most powerful tools available for managers to crunch numbers, gain a thorough understanding of a situation, and perform a what-if analysis.
Write a paper of no more than 750 words or a 5-slide power point presentation in which you discuss the activities and learning this week and share how CVP analysis may be helpful to an entrepreneur starting a new business.
Provide at least three situations or strategic decisions that may be reached using CVP analysis.
Click the Assignment Files tab to submit your assignment.
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Multiple Choice Question 37
Why are budgets useful in the planning process?
They enable the budget committee to earn their paycheck.
They help communicate goals and provide a basis for evaluation.
They guarantee the company will be profitable if it meets its objectives.
Multiple Choice Question 44 A common starting point in the budgeting process is a clean slate, with no expectations. expected future net income. past performance. to motivate the sales force.
Multiple Choice Question 48
Which of the following statements about budget acceptance in an organization is true?
The most widely accepted budget by the organization is the one prepared by top management.
Budgets are hardly ever accepted by anyone except top management.
The most widely accepted budget by the organization is the one prepared by the department heads.
Budgets have a greater chance of acceptance if all levels of management have provided input into the budgeting process.
Multiple Choice Question 38
What is budgetary control?
The process of providing information on budget differences to lower level managers
Another name for a flexible budget
The degree to which the CFO controls the budget
The use of budgets in controlling operations
Multiple Choice Question 44
The comparison of differences between actual and planned results
is done by the external auditors.
appears on the company’s external financial statements.
is usually done orally in departmental meetings.
appears on periodic budget reports.
Multiple Choice Question 45
A static budget
should not be prepared in a company.
is useful in evaluating a manager’s performance by comparing actual variable costs and planned variable costs.
shows planned results at the original budgeted activity level.
is changed only if the actual level of activity is different than originally budgeted.
Multiple Choice Question 93
A responsibility report should
show only those costs that a manager can control.
only show variable costs.
only be prepared at the highest level of managerial responsibility.
be prepared in accordance with generally accepted accounting principles.
Multiple Choice Question 99 Which responsibility centers generate both revenues and costs? Only profit centers Profit and cost centers Cost and investment centers Investment and profit centers Multiple Choice Question 100 The linens department of a large department store is an investment center. not a responsibility center. a profit center. a cost center.
Multiple Choice Question 39
What is a standard cost?
The total number of units times the budgeted amount expected
Any amount that appears on a budget
The amount management thinks should be incurred to produce a good or service
The total amount that appears on the budget for product costs
Multiple Choice Question 48
Using standard costs
increases clerical costs.
makes employees less “cost-conscious.”
provides a basis for evaluating cost control.
makes management by exception more difficult.
Multiple Choice Question 80
Unfavorable materials price and quantity variances are generally the responsibility of the
Price Quantity
Production department Purchasing department
Production department Production department
Purchasing department Purchasing department
Purchasing department Production department
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