Archives: Quiz

1) The null hypothesis in the F-test is that there is a linear relationship between the X and Y variables. 2) The economic order quantity helps one estimate the optimal number of units to purchase with each order. Answer: TRUE […]

1) The value of r2 can never decrease when more variables are added to the model. 2) » is the average of the consistency ratios. Answer: FALSE 3) Simulation of a business or process is generally performed by building a […]

1) Mutually exclusive events exist if only one of the events can occur on any one trial. 2) The shortest-route technique might be used by someone planning a vacation in order to minimize the required amount of driving. Answer: TRUE […]

1) When the smoothing constant = 0, the exponential smoothing model is equivalent to the nave forecasting model. 2) Expected monetary value (EMV) is the payoff you should expect to occur when you choose a particular alternative. Answer: FALSE 3) […]

1) Mean absolute deviation (MAD) is simply the sum of forecast errors. 2) A stockout is a situation that occurs when there is no inventory on hand. Answer: TRUE 3) The binomial distribution can be used when there are a […]

1) The maximal-flow model might be of use to an engineer looking for spare capacity in an oil pipeline system. 2) The variance of the project completion time is equal to the sum of the variances of all the activities. […]

1) ________ is also called lean production. A) Economic order quantity production B) Just-in-time production C) Materials requirements planning production D) Push-through system 2) Financial accounting provides a historical perspective, whereas management accounting emphasizes ________. A) the future B) past […]

1) Buzz’s Educational Software Outlet sells two or more of the video games as a single package. Managers are keenly interested in individual product-profitability figures. Information pertaining to three bundled products and the stand-alone prices is as follows: Using the […]

1) The ideal database for estimating cost functions contains ________. A) numerous cost driver observations B) only the independent variable and not the dependent variable C) cost driver observations spanning a narrow range D) a few values of the cost […]

1) Under the incremental method of allocating common costs ________. A) the parties are interested in being viewed as primary users B) each party bears a proportionate share of the total costs in relation to their individual stand-alone costs C) […]

1) Russo Corporation manufactured 16,000 air conditioners during November. The overhead cost-allocation base is $31.50 per machine-hour. The following variable overhead data pertain to November: What is the variable overhead efficiency variance? A) $3,937.50 favorable B) $3,937.50 unfavorable C) $4,500 […]

1) The cash flow statement includes ________. A) cash discount on sales B) cash outflow towards insurance premium C) sales revenues of the organization D) interest accrued on an investment 2) Many manufacturing, marketing, and design problems require employees with […]

1) For each cost pool listed select an appropriate allocation base from the list below. An allocation base may be used only once. Assume a manufacturing company. Allocation bases for which the information system can provide data: 1.Number of employees […]

1) The value chain is the sequence of business functions in which ________. A) value is deducted from the products or services of an organization B) producing and delivering the product or service is of prime importance C) products and […]

1) Aerated Water Company makes internal transfers at 180% of full cost. The Soda Refining Division purchases 30,000 containers of carbonated water per day, on average, from a local supplier, who delivers the water for $30 per container via an […]

1) Under the weighted-average method, the stage of completion of beginning work in process ________. A) is relevant in determining the equivalent units B) must be combined with the work done during the current period to determine the equivalent units […]

1) Comfort chair company manufacturers a standard recliner. During February, the firm’s Assembly Department started production of 73,000 chairs. During the month, the firm completed 78,000 chairs, and transferred them to the Finishing Department. The firm ended the month with […]

1) Gambino Corporation is a wholesaler that sells a single product. Management has provided the following cost data for two levels of monthly sales volume. The company sells the product for $138.80 per unit. The best estimate of the total […]

1) Buzz’s Educational Software Outlet sells two or more of the video games as a single package. Managers are keenly interested in individual product-profitability figures. Information pertaining to three bundled products and the stand-alone prices is as follows: Using the […]

1) The purchase-order lead time is the ________. A) time between placing an order and its delivery B) time between receiving a customer order and producing the products C) time between receiving a customer order and delivering the items D) […]

1) Roberson Corporation manufactured 30,000 ice chests during September. The variable overhead cost-allocation base is $11.25 per machine-hour. The following variable overhead data pertain to September: What is the flexible-budget amount? A) $121,500 B) $151,875 C) $165,000 D) $168,750 2) […]

1) Pearl Lights sells only pearl necklaces. 8,000 units were sold resulting in $240,000 of sales revenue, $60,000 of variable costs, and $40,000 of fixed costs. The breakeven point in total sales dollars is ________. A) $40,000 B) $53,334 C) […]

1) The Green Company processes unprocessed goat milk up to the splitoff point where two products, condensed goat milk and skim goat milk result. The following information was collected for the month of October: The costs of purchasing the of […]

1) Products S5 and CP8 each are assigned $100.00 in indirect costs by a traditional costing system. An activity analysis revealed that although production requirements are identical, S5 requires 45 minutes less setup time than CP8. According to an ABC […]

1) A price-bidding decision for a one-time-only special order includes an analysis of all ________. A) manufacturing costs B) cost drivers related to the product C) direct and indirect variable costs of each function in the value chain D) fixed […]

1) Aunt Ethel’s Fancy Cookie Company manufactures and sells three flavors of cookies: Macaroon, Sugar, and Buttercream. The batch size for the cookies is limited to 1,000 cookies based on the size of the ovens and cookie molds owned by […]

1) Jane Industries manufactures plastic toys. During October, Jane’s Fabrication Department started work on 10,000 models. During the month, the company completed 11,000 models, and transferred them to the Distribution Department. The company ended the month with 1,500 models in […]

1) The NPV method is the preferred method over IRR for selecting projects because ________. A) its use leads to shareholder value maximization B) it accounts for the time value of money C) it assumes that cash flows are reinvested […]

1) An Enterprise Resource Planning System can best be described as ________. A) a collection of programs that use a variety of unconnected databases B) a single database that collects data and feeds it into applications that support each of […]

1) Which of the following costs can be classified into both value-added and non-value-added costs? A) production control costs B) machine breakdown costs C) rework costs D) direct material costs 2) The cost components of a heater include $30 for […]

1) The Standards of Ethical Conduct for management accountants include concepts related to ________. A) competence, performance, diligence, and reporting B) competence, confidentiality, integrity, and credibility C) experience, diligence, reporting, and objectivity D) diligence, objectivity, conflicts of interest, and credibility […]

1) Bismite Corporation purchases trees from Cheney lumber and processes them up to the splitoff point where two products (paper and pencil casings) are obtained. The products are then sold to an independent company that markets and distributes them to […]

1) Which of the following best describes transferred-in costs in process costing? A) These costs are incurred in previous departments that are carried forward to subsequent departments. B) These costs are transferred in to the company by an external vendor. […]

1) In making the decision to buy the model 260 machine rather than the model 330 machine, the sunk cost was: A) $418,000 B) $456,000 C) $474,000 D) $496,000 2) Sandra’s Sheet Metal Company has two divisions. The Raw Material […]

1) Hammond and Jarrett provide tax consulting for estates and trusts. Their job-costing system has a single direct-cost category (professional labor) and a single indirect-cost pool (research support). The indirect-cost pool contains all the costs except direct personnel costs. All […]

1) Zephyr Apparels is a clothing retailer. Unit costs associated with one of its products, Product DCT121, are as follows: What are the direct variable manufacturing costs per unit associated with Product DCT121? A) $142 B) $90 C) $105 D) […]

1) An assumption of the FIFO process-costing method is that ________. A) the units in beginning inventory are not necessarily assumed to be completed by the end of the period B) the units in beginning inventory are assumed to be […]

1) The return on investment is usually considered the most popular approach to measure performance because ________. A) it blends all the ingredients of profitability into a single percentage B) once determined, there is no need to use it with […]

1) Too high a price may ________. A) deter a customer from purchasing a product B) increase demand for the product C) indicate supply is too plentiful D) decrease a competitor’s market share 2) Which of the following is an […]

1) Which of the following is true of the Work-in-Process Control account? A) It tracks all direct material purchases. B) Its balance is the sum of amounts from all in-process individual job-cost records. C) It is an expense account. D) […]

1) Total manufacturing costs is comprised of ________. A) direct materials costs and period costs B) direct materials costs, direct manufacturing labor costs, and manufacturing overhead costs C) indirect materials costs, indirect manufacturing labor costs, and manufacturing overhead costs D) […]

1) Velshi Printers has contracts to complete weekly supplements required by forty-six customers. For the year 2015, manufacturing overhead cost estimates total $840,000 for an annual production capacity of 12 million pages. For 2015 Velshi Printers has decided to evaluate […]

1) Ventaz Corp manufactures glasses. The manufacturing cycle efficiency is 70%. What is its waiting time if the manufacturing lead time is 120 minutes per keyboard? A) 38.00 minutes B) 42.00 minutes C) 48.00 minutes D) 36.00 minutes. 2) Gloria’s […]

1) A budget serves as much as a control tool as a planning tool because ________. A) it aids in the coordination and communication among various business functions B) it helps to evaluate customer needs and feedback C) it is […]

1) Ruben intends to sell his customers a special round-trip airline ticket package. He is able to purchase the package from the airline carrier for $150 each. The round-trip tickets will be sold for $200 each and the airline intends […]

1) Which of the following is true of flexible budget? A) It calculates total variable cost by multiplying actual units by budgeted variable cost per unit. B) It calculates total fixed cost by multiplying actual units by budgeted fixed cost […]

1) When fixed costs are $50,000 and variable costs are 60% of the selling price, then breakeven sales are ________. A) $115,000 B) $125,000 C) $175,000 D) $275,000 2) A budget ________. A) is the qualitative expression of a proposed […]

1) The internal rate-of-return (IRR) method calculates ________. A) the discount rate at which an investment’s present value of the total of all expected cash inflows equals the present value of its expected cash outflows. B) the discount rate at […]

1) Supply the missing data for each of the following proposals: Proposal A Proposal B Proposal C Initial investment (a) $62,900 $226,000 Annual net cash inflow $60,000 (c) (e) Life, in years 10 6 10 Salvage value $0 $10,000 $0 […]

1) The weighted-average cost of capital (WACC) equals ________. A) the after-tax average cost of all the long-term and short-term funds B) the after-tax average cost of all the long-term funds C) the pre-tax average cost of all the short-term […]