Sept 20

Question 1

Which of the following listings correctly describes the order in which the four types of budgets must be prepared? 4

Answer 1

1 sales
2 production
3 direct materials purchases
4 cash disbursements

Question 2

In the cost of quality, costs incurred in detecting individual units of product that do not conform to specifications are…

Answer 2

Appraisal costs

Question 3

Typical product costing systems synchronize the recording of accounting system entries with the physical sequence of purchases and production. The alternative of delaying journal entries until after the physical sequences have occurred is referred to as…

Answer 3

Backflush costing

Question 4

What does not affect the variance of a portfolio?

Answer 4

Expected market rate

Question 5

What activities are characteristic of book’s activity based costing approach?

Answer 5

Activities that do not add value are identified and reduced to the
Extent possible

Question 6

Which of the following is a characteristic of a flexible budget?

Answer 6

Provides budgeted numbers for various activity levels

Question 7

Which of the following actions is the acknowledged preventative measure for a period of deflation?

Answer 7

Increasing the money supply

Question 8

Platinum Co. has a receivable due in 30 days for 30,000 euros. The treasurer is concerned that the value of the euro relative to the dollar will drop before the payment is received. What should Platinum do to reduce the risk?

Answer 8

Enter into a forward contract to sell 30,000 euros in 30 days

Question 9

If a company changes its method of accounting from a byproduct to a joint product, what would be the effect on the company’s gross margin?

Answer 9

Selling costs are not included in gross margin calculation

Under the joint product

Question 10

What is an improvement initiative to eliminate blank discs?

Answer 10

Six sigma

Question 11

What is the forecasting technique most relevant for analyzing data prior to creation of a flexible budget?

Answer 11

Regression analysis

Question 12

Objectives of disaster recovery do not include which of the following?

Answer 12

Perform regular preventative maintenance on key system components

Question 13

Why is a well defined organization structure important?

Answer 13

Define lines of authority

Question 14

A network of computers located throughout an organization’s different facilities and linked to a centralized computer to fulfill information processing needs is called…

Answer 14

Distributed data processing