ACC 561 FINAL EXAM NEW CLASSROOM

ACC 561 FINAL EXAM NEW CLASSROOM

Which of the following is an advantage of corporations relative to partnerships and sole proprietorships?

The group of users of accounting information charged with achieving the goals of the business is its

Which of the following financial statements is concerned with the company at a pointin time?

An income statement

The most important information needed to determine if companies can pay theircurrent obligations is the

A liquidity ratio measures the

The convention of consistency refers to consistent use of accounting principles

Horizontal analysis is also known as

Horizontal analysis is a technique for evaluating a series of financial statement dataover a period of time

Vertical analysis is a technique that expresses each item in a financial statement

Process costing is used when

An important feature of a job order cost system is that each job

In a process cost system, product costs are summarized:

An activity that has a direct cause-effect relationship with the resources consumed is a(n)

Activity-based costing

A cost which remains constant per unit at various levels of activity is a

The break-even point is where

Fixed costs are $600,000 and the contribution margin per unit is $150. What is the break-even point?

When a company assigns the costs of direct materials, direct labor, and both variableand fixed manufacturing overhead to products, that company is using

If a division manager’s compensation is based upon the division’s net income, themanager may decide to meet the net income targets by increasing production when using

An unrealistic budget is more likely to result when it

A major element in budgetary control is

The purpose of the sales budget report is to

The accumulation of accounting data on the basis of the individual manager who has the authority to make day-to-day decisions about activities in an area is called

Variance reports are

Internal reports that review the actual impact of decisions are prepared by

The process of evaluating financial data that change under alternative courses of action is called

Seasons Manufacturing manufactures a product with a unit variable cost of $100 anda unit sales price of $176. Fixed manufacturing costs were $480,000 when 10,000 units were produced and sold. The company has a one-time opportunity to sell an additional 1,000 units at $140 each in a foreign market which would not affect its present sales. If the company has sufficient capacity to produce the additional units, acceptance of the special order would affect net income as follows:

Carter, Inc. can make 100 units of a necessary component part with the following costs:

Direct Materials $120,000

Direct Labor 20,000

VariableOverhead 60,000

Fixed Overhead 40,000

If Carter can purchase the component externally for $220,000 and only $10,000 of the fixed costs can be avoided, what is the correct make-or-buy decision?

A company has a process that results in 15,000 pounds of Product A that can be sold for $16 per pound. An alternative would be to process Product A further at a cost of $200,000 and then sell it for $28 per pound. Should management sell Product A now or should Product A be processed further and then sold? What is the effect of the action?