BUS 475 FINAL EXAM 600 MCQS
1) One of Astro Company’s activity cost pools is machine setups, with estimated overhead of $150,000. Astro produces sparklers (400 setups) and lighters (600 setups). How much of the machine setup cost pool should be assigned to sparklers?
2) A company just starting in business purchased three merchandise inventory items at the following prices. First purchase $80; Second purchase $95; Third purchase $85. If the company sold two units for a total of $240 and used FIFO costing, the gross profit for the period would be _____.
3). If a company reports a net loss, it __________.
- Will not be able to make capital expenditures
- Will not be able to pay cash dividends
- Will not be able to get a loan
- May still have a net increase in cash
4). As Plant Controller, you are trying to determine which costs over which you have the most control on a day to day basis. Your goal is to achieve better profitability. The Plant Operations Manager suggests that overhead is the easiest area to directly reduce costs. Which of the following items would be classified as manufacturing overhead?
- The western division’s vice president’s salary
- General corporate liability insurance
- Cost of landscaping the corporate office
- Factory janitor
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s breakeven point?
- 2,133 units
- 6,200 units
- 4,600 units
6) Of the following companies, which one would not likely employ the specific identification method for inventory costing?
- Hardware store
- Farm implement dealership
- Antique shop
- Music store specializing in organ sales
7) What effect do current technology changes have on managerial accounting?
A. Reduction of reporting costs of managerial accounting information
B. Increase in product costs
C. Reduction of emphasis on the value chain
D. Creation of the middleman
8) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company’s net income increase?
9) What is the preparation of reports for each level of responsibility in the company’s organization chart called?
A. Master budgeting analysis
B. Responsibility reporting
C. Exception reporting
D. Static reporting
10) “Generally accepted” in the phrase generally accepted accounting principles means that the principles __________.
A. Have been approved for use by the managements of business firms
B. Have substantial authoritative support
C. Have been approved by the Internal Revenue Service
D. Are proven theories of accounting
11) Which one of the following is a product cost?
A. Advertising costs
B. Office salaries
C. Sales person’s salaries
D. Indirect labor
12) Sam’s Used Cars uses the specific identification method of costing inventory. During March, Sam purchased three cars for $6,000, $7,500, and $9,750, respectively. During March, two cars are sold for $9,000 each. Sam determines that at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
13) What exists when budgeted costs exceed actual results?
A. An excess profit
B. An unfavorable difference
C. A favorable difference
D. A budgeting error
14) The major reporting standard for management accounts is __________.
A. Generally accepted accounting principles
B. Relevance to decisions
C. The Sarbanes-Oxley Act of 2002
D. The Standards of Ethical Conduct for Practitioners of Management Accounting and Financial Management15) To move the allocation of resources closer to the social optimum, policymakers should typically try to induce firms in an oligopoly to __________.
A. Cooperate rather than compete with each other
B. Compete rather than cooperate with each other
C. Form various degrees of cartels
D. Collude with each other
16) When a firm sells a good or a service, the sale contributes to the nation’s income __________.
A. We have to know whether the item being sold is a good or a service in order to answer the question
B. Whether the buyer of the good or a service is a household, another firm, or the government
C. Only if the buyer of the good or service is a household or another firm
D. Only if the buyer of the good or service is a household
17) Institutions in the economy that help to match one person’s saving with another person’s investment are collectively called the __________.
A. Financial system
B. Monetary system
C. Banking system
D. Federal Reserve system
18) When, in a particular market, the law of demand and the law of supply both apply, the imposition of a binding price ceiling in that market causes quantity demanded to be __________.
A. Double the quantity supplied
B. Equal to quantity supplied
C. Less than quantity supplied
D. Greater than quantity supplied
19) There are two types of markets in which firms face some competition yet are still able to have some control over the prices of their products. The names given to these market structures are __________.
A. Duopoly and imperfect competition
B. Perfect competition and monopolistic competition
C. Duopoly and triopoly
D. Monopolistic competition and oligopoly
20) Which of the following would be most likely to contribute to the breakdown of a cartel in a natural resource (e.g., bauxite) market?
A. Unequal member ownership of the natural resource
B. High compatibility of member interests
C. Low price elasticity of demand
D. High prices
21) One characteristic of an oligopoly market structure is:
A. The actions of one seller have no impact on the profitability of other sellers
B. Products typically sell at a price that reflects their marginal cost of production
C. Firms in the industry have some degree of market power
D. Firms in the industry are typically characterized by very diverse product lines
22) Real GDP __________.
A. Is a measure of the value of goods only; it excludes the value of services
B. Is not a valid measure of the economy’s performance, since prices change from year to year
C. Evaluates current production at the prices that prevailed in some specific year in the past
D. Evaluates current production at current prices
23) The open-economy macroeconomic model examines the determination of __________.
A. The trade balance and the exchange rate
B. Unemployment and the exchange rate
C. The output growth rate and the inflation rate
D. The output growth rate and the real interest rate
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A. Balance of trade
B. Financial and capital account
C. Government financial account
D. Current account
25) The Federal Reserve will tend to tighten monetary policy when __________.
A. It thinks inflation is too high today, or will become too high in the future
B. It thinks the unemployment rate is too high
C. The growth rate of real GDP is quite sluggish
D. Interest rates are rising too rapidly
26) Which of the following is not correct?
A. In 2005, the U.S. government had a deficit
B. Deficits give people the opportunity to consume at the expense of their children, but they do not require them to do so
C. The U.S. debt per-person is large compared with average lifetime income
D. A potential cost of deficits is that they reduce national saving, thereby reducing growth of the capital stock and output growth
27) The open-economy macroeconomic model includes __________.
A. Neither the market for loanable funds or the market for foreign-currency exchange
B. Only the market for foreign-currency exchange
C. Both the market for loanable funds and the market for foreign-currency exchange
D. Only the market for loanable funds
28) ABC International carefully watches the actions of its most innovative competitor and learns from them. ABC can establish a low-cost position by:
A. Technology followers are not successful at low-cost strategies
B. Producing an imitation of the new technology that utilizes lower-quality and lower-cost materials
C. Mass-producing products that have an established market niche
D. Making subtle changes to the product, thereby avoiding patent restrictions
E. Learning from the leader thereby avoiding the costs and risks of technology leadership
29) A leader is:
A. Someone well-respected by others
B. The top level manager in a firm or business
C. Someone who influences others to attain goals
D. Someone with authority over others
E. A strategic level manager
30) __________ is the process of working with people and resources to accomplish organizational goals.
C. Decision making
31) Which of the following has proven to be a particularly good predictor for jobs that require cognitive complexity?
A. Behavioral assessment
B. Integrity evaluations
C. Aptitude tests
D. Intelligence tests
E. Work sampling
32) Teams that operate separately from the regular work structure and exist temporarily are known as:
A. Transnational teams
B. Parallel teams
C. Self-managed teams
D. Management teams
E. Self-designing teams
33) The pursuit of lucrative opportunities by enterprising individuals is called:
A. Social experimentation
E. Business incubating
34) The best way for an employer to find out if a potential employee can do a job is by __________.
A. Using a performance simulation test
B. Using a written test
C. Administering an IQ test
D. Using the interview process
E. Having them spend a day in the office
35) A manager’s ability to stimulate people to be high performers is referred to as:
36) Teams that work on long-term projects but disband once the work is completed are known as:
A. Parallel teams
B. Project and development teams
C. Transnational teams
D. Traditional work groups
E. Management teams
37) Having individuals actually do the job they are applying for as a test to see if they can do it is __________.
A. An approach with low reliability
B. An approach with high reliability
C. A formal means of screening candidates
D. An informal means of screening candidates
E. An approach with high face validity
38) As related to managing of human resources, diversity refers to:
A. Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
B. Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
C. Differences in retention strategies (such as training, hiring, incentives, etc)
D. Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
E. Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
39) To be competitive in a global economy, Europeans must increase their level of:
A. Population density
B. Philanthropic contributions
C. Financial subsidy
D. Espionage activity
40) A manager’s ability to stimulate people to be high performers is referred to as:
41) Sebastian Stabilio just joined a team of people from throughout his organization whose primary task is to recommend valuable uses for the scrap generated in the manufacturing process. The team meets twice per week; otherwise members work within the usual organizational structure. The team, not permanent, which Sebastian has joined, would be considered a:
A. Work team
B. Project team
C. Parallel team
D. Project group
E. Working group
42) To estimate the average annual expenses of students on books and class materials a sample of size 36 is taken. The average is $850 and the standard deviation is $54. A 99% confidence interval for the population mean is __________.
A. $825.48 to $874.52
B. $823.72 to $876.28
C. $832.36 to $867.64
D. $826.82 to $873.18
43) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18. For this sample, which measure of central tendency is least representative of the “typical” student?
44) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours.
A. The p-value cannot be determined without specifying
B. The p-value is less than .05
C. The p-value is equal to .05
D. The p-value is greater than .05
45) Jolly Blue Giant Health Insurance (JBGHI) is concerned about rising lab test costs and would like to know what proportion of the positive lab tests for prostate cancer are actually proven correct through subsequent biopsy. JBGHI demands a sample largeenough to ensure an error of ± 2% with 90% confidence. What is the necessary sample size?
46) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours. In a left-tailed test at = .05 we would __________.
A. Switch to alpha of 0.01 for a more powerful test
B. Feel uncomfortable with either decision (too close)
C. Comfortably accept the claim
D. Comfortably reject the claim
47) In a right-tail test, a statistician came up with a z test statistic of 1.469. What is the p-value?
48) Theoretically, service capacity must exceed demand, lest queues become infinitely long. If capacity does not exceed demand, what is likely to happen?
A. Customers will renege or balk, thereby reducing demand
B. Servers will decrease time spent per customer, thereby increasing capacity
C. Servers will eliminate time-consuming portions of their jobs, thereby increasing capacity
D. All of these
49) Likely reasons for inaccurate control limits would include which of the following?
A. The engineering parameter for variance is unknown
B. The engineers were underpaid for their work
C. There was insufficient preliminary sampling
D. Process variation was not zero, as expected
50) Which one of the following statements concerning production and staffing plans is best?
A. Production and staffing plans specify production rates, workforce levels, and inventory holdings, but do not account for capacity limitations because they are aggregated
B. Production and staffing plans attempt to achieve several objectives, all of which must be consistent with one another
C. When production and staffing plans are made, aggregation can be performed only along two dimensions: products and time