Becker

Question 1

In addition to adherence to policies & procedures, effective internal requires?

Answer 1

Use of judgment in determining the sufficiency of controls, in applying the proper controls & n assessing the effectiveness of the system of internal controls.

Question 2

Components of internal control

Answer 2

“CRIME” Control environment; Risk assessment; Information and communication; Monitoring; (Existing) control activities

Question 3

5 Principles of Control Environment

Answer 3

Commitment to ethical values & integrity; board independence & oversight; Organizational structure; Commitment to competence; Accountability

Question 4

4 Principles of Risk Assessment

Answer 4

Specify objectives; Identify & analyze risks; Consider the potential for fraud; Identify & assess changes

Question 5

3 Principles of Information & Communication

Answer 5

Obtain & use information; Internally communicate information; Communicate with external parties

Question 6

2 Principles of Monitoring

Answer 6

Ongoing and/or separate evaluations; Communication of deficiencies

Question 7

3 Principles of Existing Control Activates

Answer 7

Select & develop control activities; select & develop technology controls; deploy through policies & procedures

Question 8

Order of Enterprise Risk Management Framework

Answer 8

“IS EAR AIM” Internal Environment; Setting Objectives; Event Identification; Assessment of risk; Risk response; Activities (control); Information & communication; Monitoring

Question 9

Balanced Scorecard

Answer 9

A framework used for implementing strategy that converts a company’s strategic objectives into a set of performance measures

Question 10

Total Factor Productivity Ratio (TFP)

Answer 10

Reflect the quantity of all output produced relative to the costs of all inputs used

Question 11

Partial Productivity Ratios(PPRs)

Answer 11

Reflect the quantity of output produced relative to the quantity of individual inputs used

Question 12

Control Chart

Answer 12

Graphical tool used to plot a comparison of actual results by batch to an acceptable range

Question 13

Pareto Diagram

Answer 13

Shows the individual and cumulative frequency of quality issues; used to determine the quality-control issues that are most frequent and often demand the greatest attention.

Question 14

Cause & Effect (Fishbone) Diagram

Answer 14

Provides a framework for managers to analyze the problems that contribute to the occurrence of defects.

Question 15

5 Marketing Practices & Methods

Answer 15

Transaction marketing; Interaction-Based relationship marketing; Database marketing; E-marketing; Network Marketing

Question 16

A single cost object can have more than one ?

Answer 16

Measurement; e.g. Inventory costs for financial statements are usually different from costs reported for tax purposes.

Question 17

Most frequent cost objectives include:

Answer 17

Product costing; Income determination; Efficiency measurements

Question 18

Prime Cost

Answer 18

Direct Labor + Direct Materials

Question 19

Conversion Cost

Answer 19

Direct Labor + Manufacturing Overhead

Question 20

Overhead Allocation - Traditional Costing

Answer 20

Step 1: Calculated OH rate = Budgeted OH costs/Estimate cost driver; Step 2: Applied OH = Actual cost driver x OH rate from step 1

Question 21

Variable Costs

Answer 21

Changes proportionally with the cost driver (sales volume/production volume); Constant per unit, varies in total

Question 22

Fixed Costs

Answer 22

Varies per unit, constant in total

Question 23

Semi-variable Costs

Answer 23

Cost contains components that remain constant over the relevant range and components that fluctuate in direct relation to production

Question 24

Cost of Goods Manufactured

Answer 24

WIP (begin) + direct material, labor and OH applied = Total Manufacturing Costs available - WIP (end) = COGM

Question 25

Cost of Goods Sold

Answer 25

Finished Goods Inv (begin) + COGM = COG AFS - Finished Goods Inv (end) = COGS

Question 26

Job Order Costing

Answer 26

Cost is allocated to a specific job as it moves through the manufacturing process; Typically requires a limited number of WIP accounts

Question 27

Process Costing

Answer 27

Averages costs and applies them to a large number of homogeneous items

Question 28

5 Steps to Process Costing

Answer 28

1. Summarized the flow of physical units; 2. Calculate “equivalent unit” output; 3. Accumulate the total costs to be accounted for; 4. Calculate the unit costs based on TC & EU; 5. Apply the average costs to the units completed and in ending inventory

Question 29

Equivalent Unit

Answer 29

Equal to the amount of direct material, direct labor or conversion costs necessary to complete one unit of production

Question 30

Weighted Average Equivalent Units Calculation

Answer 30

Units Completed + (Ending WIP*% completed)

Question 31

FIFO Equivalent Units Calculations

Answer 31

(Beginning WIP % to be completed) + (Units completed - Beginning WIP) +Ending WIP% completed)

Question 32

Cost per Equivalent Unit (Weighted Average)

Answer 32

(Beginning Costs + Current Cost)/Equivalent Units

Question 33

Cost per Equivalent Unit (FIFO)

Answer 33

Current Costs Only/Equivalent Units

Question 34

Normal Spoilage

Answer 34

Occurs under regular operating conditions and is included in the standard cost of the manufactured product

Question 35

Abnormal Spoilage

Answer 35

Shouldn’t occur under normal operating conditions and is NOT included in the standard cost of a manufactured product (EU include spoilage) - expensed during period

Question 36

Volume Based Costing

Answer 36

Assigns OH as a single unit cost pool with a single plant wide OH application rate using a single allocation base

Question 37

Activity Based Costing (ABC)

Answer 37

Assumes that the resource-consuming activities with specific purposes cause costs; Multiple cost pools for cost allocation

Question 38

Cost Driver

Answer 38

A factor that has the ability to change total costs

Question 39

Service Costs Allocation - ABC Direct Method

Answer 39

Widely used; each service department’s total costs are directly allocated to the production departments without recognizing that service departments themselves may use the services from other service departments

Question 40

Service Costs Allocation - ABC Step Down Method

Answer 40

Service department costs are also allocated to other service departments as well as production departments; Assumes that once a service department’s costs have been allocated to another service department, there can be NO subsequent costs allocated back to the other service departments.

Question 41

Joint Products

Answer 41

Two or more products that are generated from a common input; Represent outputs of significant value that are the object of a manufacturing process

Question 42

Split-off Point

Answer 42

The point in the production process where the joint products can be recognized as individual products

Question 43

By-Products

Answer 43

Minor products of relatively small value that incidentally result from the manufacture of the main products

Question 44

Joint Product Costs Allocation Methods

Answer 44

Unit Volume Relationship or Relative Net Realizable Value at Split-off Point (RNRV)

Question 45

Sales Price Quotations Available (RNRV)

Answer 45

Allocation is based on relative sales value; A’s units * A’s sales value or B’s units * B’s slaes value / Total of A & B’s sales value times units x Joint Costs

Question 46

Sales Value NOT Available (RNRV)

Answer 46

Final total sales value - further processing costs = Net realizable value (add calc for all products); Proportional allocated to all products

Question 47

By-Products Income Allocation

Answer 47

Applied to main product by reducing joint product costs or recorded as misc. income