Finance, Business, Accounting - FINALS 100 Questions due in 1 Hour 30 Mins
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1) 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?
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2) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals:
Closing entries are necessary for __________.
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3) 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 break even point?
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4) 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?
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5) "Generally accepted" in the phrase generally accepted accounting principles means that the principles __________.
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6) What is value chain management best defined as?
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7) The major reporting standard for management accounts is __________.
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8) These are selected account balances on December 31, 2008.
What is the net amount of property, plant, and equipment that will appear on the balance sheet?
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9) The cost principle is the basis for preparing financial statements because it is __________.
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10) Multinational corporations __________.
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11) The standards and rules that are recognized as a general guide for financial reporting are called __________.
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12) A well-designed activity-based costing system starts with __________.
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13) These are selected account balances on December 31, 2008.
What is the net amount of property, plant, and equipment that will appear on the balance sheet?
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14) 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?
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15) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he narrows his options down to four choices: Option A, Option B, Option C, and Option D. Each option costs $100. Finally he decides on Option B. The opportunity cost of this decision is __________.
A. $100
B. $300
C. the value to Maurice of Options A, C and D combined
D. the value to Maurice of the option he would have chosen had Option B not been available
16) If a binding price ceiling were imposed in the computer market, __________.
A. a shortage of computers would develop
B. the quality of computers would increase
C. the supply of computers would decrease
D. the demand for computers would increase
17) Which of the following statements about GDP is correct?
A. GDP is to a nation’s economy as household income is to a household.
B. GDP increases if the total population increases.
C. Money continuously flows from households to government and then back to households, and GDP measures this flow of money.
D. GDP measures two things at once: the total income of everyone in the economy and the unemployment rate.
18) The price of a good that prevails in a world market is called the
A. comparative price.
B. world price.
C. relative price.
D. absolute price.
19) In economics, the cost of something is __________.
A. what you give up to get it
B. often impossible to quantify, even in principle
C. always measured in units of time given up to get it
D. the dollar amount of obtaining it
20) Resources are __________.
A. scarce for households and scarce for economies
B. plentiful for households and plentiful for economies
C. plentiful for households but scarce for economies
D. scarce for households but plentiful for economies
21) Assume oligopoly firms are profit maximizers, they do not form a cartel, and they take other firms' production levels as given. Then in equilibrium the output effect __________.
A. must balance with the price effect
B. can be larger or smaller than the price effect
C. must be smaller than the price effect
D. must dominate the price effect
22) President George W. Bush and congress cut taxes and raised government expenditures in 2003. Which of the following is not correct?
A. In general monetary policy can be implemented faster than fiscal policy.
B. In general it is easier to reverse monetary policy than to reverse fiscal policy.
C. While there was subsequent improvement in economic performance, it’s not entirely clear that this was due to the policy.
D. At the time the economy was just moving into a recession.
23) Consider two items that might be included in GDP: (1) The estimated rental value of owner-occupied housing; and (2) purchases of newly-constructed homes. How are these two items accounted for when GDP is calculated?
A. Item (1) is included in the investment component, while item (2) is included in the consumption component.
B. Only item (2) is included in GDP and it is included in the investment component.
C. Item (1) is included in the consumption component, while item (2) is included in the investment component.
D. Both item (1) and item (2) are included in the consumption component of GDP.
24) The part of the balance of payments account that lists all long-term flows of payments is called the:
A. government financial account.
B. balance of trade.
C. financial and capital account.
D. current account.
25) The part of the balance of payments account that records the amount of foreign currency the government buys or sells is the:
A. government financial account.
B. balance of trade.
C. financial and capital account.
D. current account.
26) Many U.S. business leaders argue that the current state of U.S. net exports is the result of __________.
A. unproductive U.S. workers.
B. unfair foreign competition.
C. free trade policies of foreign governments.
D. U.S. export subsidies.
27) The model of short-run economic fluctuations focuses on the price level and __________.
A. the neutrality of money
B. Net GDP
C. economic growth
D. real GDP
28) Managers will utilize __________ skills with increasing frequency as they rise within an organization.
A. Professional
B. Technical
C. Interpersonal and communication
D. Conceptual and decision
E. Professional
29) Which of the following best describes a mental image of a possible and desirable future state of the organization?
A. Vertical communication
B. Leadership
C. Vision
D. Mission
E. Horizontal communication
30) Teams that operate separately from the regular work structure and exist temporarily are known as:
A. Self-managed teams
B. Self-designing teams
C. Parallel teams
D. Management teams
E. Transnational teams
31) Which of the following has proven to be a particularly good predictor for jobs that require cognitive complexity?
A. aptitude tests
B. work sampling
C. integrity evaluations
D. intelligence tests
E. behavioral assessment
32) Which of the following statements does NOT support Total Quality Management?
A. Use numerical quotas
B. Build long-term relationships instead of awarding business on price tag alone
C. Break down barriers among departments
D. Strive for long-term improvement rather than short-term profit
E. Creating silos between departments
33) Which of these refers to the practices aimed at discovering and harnessing an organization's intellectual resources?
A. Competitiveness
B. Innovation
C. Knowledge management
D. Collaboration
E. Effectiveness
34) Which of these describes a vision, as it pertains to leadership?
A. Likely to land you in a padded room
B. The method through which leaders achieve goals
C. A mental image of a future state of an organization
D. A long-term goal of an organization
E. A short-term goal of an organization
35) A leader is:
A. Someone who influences others to attain goals
B. A strategic level manager
C. The top level manager in a firm or business
D. Someone with authority over others
E. Someone well-respected by others
36) The most dominant areas in the global economy include:
A. North America, Asia and Africa
B. North America, South America and Western Europe
C. North America, Mexico and Asia
D. North America, Western Europe and Asia
E. Western Europe, Asia and Africa
37) As related to managing of human resources, diversity refers to:
A. Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
B. Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.)
C. Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.)
D. Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.)
E. Differences in retention strategies (such as training, hiring, incentives, etc)
38) The pursuit of lucrative opportunities by enterprising individuals is called:
A. Entrepreneurship
B. Business incubating
C. Independence
D. Intrapreneurship
E. Social experimentation
39) One study found that manufacturing labor costs about _____ an hour in China, compared to _____ dollars in the United States.
A. $2; about 25
B. Less than $1; about 25
C. About $2; about 15
D. Less than $1; about 15
E. Less than $1; about 40
40) The Aquatic Center, Inc. periodically reviews the goals of the company. During the process, The Aquatic Center managers analyze their current strategies as compared to their competitors, determine goals that they will pursue and decide upon specific actions for each area of the company to take in pursuit of these goals. The Aquatic Center managers have been engaged in the management function of:
A. Controlling
B. Goal Coordination
C. Planning
D. Organizing
E. Staffing
41) Building a dynamic organization is another way of describing which function of management?
A. Staffing
B. Leading
C. Controlling
D. Planning
E. Organizing
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42) William used a sample of 68 U.S. cities to estimate the relationship between Crime (annual property crimes per 100,000 persons) and Income(median income per capita). His estimated regression equation was Crime = 428 + .050 Income. From this information, we can conclude that __________.
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43) Use the following table to answer question:
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44) Sampling error can be reduced by __________.
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45) In a right-tail test, a statistician came up with a z test statistic of 1.469. What is the p-value?
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46) Independent events A and B would be consistent with which of the following statements:
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47) 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
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48) A computer analysis reveals that the best-fitting trend model is Yt = 4.12 e 0.987 t. The trend was fitted using year-end common stock prices for Melodic Kortholt Outlet for the last six years. The R2 is 0.8571. If we fit a linear trend to data that are growing exponentially __________.
A. the absolute annual growth (in dollars per share) is increasing
B. at the end of year 3 the stock price would be nearly $80
C. few investments could match the astounding growth rate
D. the stock's true intrinsic value is $4.12
49) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of 15 days. Finally, A–E–C has a length of 20 days. Which one of the following statements is TRUE?
A. The expected duration of this project is 25 + 15 + 20 = 60 days.
B. A–B–C has the most slack.
C. The expected duration of this project is 25 days.
D. A–D–C is the critical path.
50) In an activity-on-node [AON] network, the nodes represent ____________, whereas the arcs represent ____________.
A. precedence relationships; time
B. activities; precedence relationships
C. events; activities
D. activities; time
51) Which one of the following statements concerning production and staffing plans is best?
A. A master production schedule is a projected statement of income, costs, and profits.
B. A staffing plan is the intermediate link between the business plan and the master production schedule.
C. Production plans are based primarily on information from the master production plan.
D. Aggregation can be performed along three dimensions: product families, labor, and time.
52) Theoretically, service capacity must exceed demand, lest queues become infinitely long. If capacity does not exceed demand, what is likely to happen?
A. All of these
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. Customers will renege or balk, thereby reducing demand.
Information Systems
53) Zappos built the majority of its information systems using which of the following?
A. Consultants
B. Open source software
C. Free software
D. Vendor software
E. Proprietary software
54) When your purchases are swiped over the bar-code reader at the point-of-sale terminals at Wal-Mart, a _____ records the data.
A. office automation system
B. dashboard
C. functional area information system
D. transaction processing system
E. enterprise resource planning system
55) The Global, Web-Based Platform enables individuals to do which of the following?
A. all of these are true
B. exchange knowledge
C. access information, services, and entertainment
D. connect, compute, communicate, collaborate, and compete everywhere and all the time
E. produce and sell goods and services
56) Which of the following is not a source for external data?
A. government reports
B. sensors
C. corporate databases
D. commercial databases
E. satellites
57) Fundamental points about network computing in organizations include all of the following except:
A. Networks support new ways of doing business
B. Networks can be of any size, from small to enormous
C. Computer data exchange provides significant advantages to organizations
D. Computers constantly exchange data
E. Networks have had limited impact on organizational productivity
58) A company wants to use data from past promotional mailings to identify people who would likely respond favorably to future mailings. This company would most likely use _____.
A. data mining
B. neural networks
C. multidimensional data analysis
D. structured query language
E. expert systems
59) Computer support is greatest for which of the following problems?
A. Structured and management control
B. Structured and operational control
C. Unstructured and operational control
D. Semistructured and strategic planning
E. Semistructured and management control
60) _____ is the efficient and effective execution of specific tasks.
A. Wisdom
B. Strategic planning
C. Management control
D. Operational control
E. Expertise
61) The management cockpit best exemplifies which type of system?
A. Group decision support system
B. Digital dashboard
C. Expert system
D. Decision support system
E. Functional area information system
62) Which of the following statements about information systems is not correct?
A. Managing information systems is difficult.
B. Information systems are based on the needs of employees.
C. Information systems tend to follow the structure of the organization.
D. Information systems are concentrated in the IS Department.
E. Any information system can be strategic.
63) Bell Weather, Inc. has a beta of 1.25. The return on the market portfolio is 12.5%, and the risk-free rate is 5%. According to CAPM, what is the required return on this stock?
A. 15.62%
B. 9.37%
C. 20.62%
D. 14.37%
64) Bondholders have a priority claim on assets ahead of:
A. creditors.
B. shareholders.
C. common and preferred stockholders.
D. investors
65) Mortgage bonds:
A. can only be issued by financial institutions.
B. are secured by a lien on real property.
C. are a type of debenture.
D. usually pay little or no interest.
66) Given the following annual net cash flows, determine the IRR to the nearest whole percent of a project with an initial outlay of $1,520.
Year Net Cash Flow
1 $1,000
2 $1,500
3 $ 500
A. 48%
B. 32%
C. 40%
D. 28%
67) Disadvantages of using current liabilities as opposed to long-term debt include:
A. greater risk of illiquidity, and uncertainty of interest costs
B. higher cash flow exposure
C. uncertainty of future liabilities
D. decreased risk of liquidity
E. certainty of interest costs
68) Forward rates are quoted:
A. in direct form and at a premium or discount
B. daily
C. in an indirect form
D. by the FDIC
E. on financial statements
69) Which of the following represents an attempt to measure the earnings of the firm’s operations over a given time period?
A. Balance sheet
B. Income statement
C. Cash flow statement
D. Quarterly statement
70) According to the hedging principle, permanent assets should be financed with _____ liabilities.
A. permanent
B. current
C. spontaneous
D. fixed
71) Which of the following is most consistent with the hedging principle in working capital management?
A. Fixed assets should be financed with short-term notes payable.
B. Inventory should be financed with preferred stock.
C. Accounts receivable should be financed with short-term lines of credit.
D. Borrow on a floating rate basis to finance investments in permanent assets.
72) Which of the following best represents operating income?
A. Income after financing activities
B. Income from capital gains
C. Earnings before interest and taxes
D. Income from discontinued operations
73) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock?
A. 36.13%
B. 8.0%
C. 12.5%
D. 13.6%
74) Exchange rate risk:
A. arises from the fact that the spot exchange rate on a future date is a random variable.
B. has been phased out due to recent international legislation.
C. applies only to certain types of domestic businesses.
D. doesn’t affect trades made in US Dollars.
75) PepsiCo calculates unlevered betas for each peer group in order to:
A. eliminate different business risks.
B. eliminate judgment factors.
C. eliminate competitive factors.
D. eliminate different financial risks.
Marketing
76) The basic objective of the U.S. market-directed economic system is to:
A. minimize inflation.
B. provide each person with an equal share of the economic output.
C. satisfy consumer needs as they--the consumers--see them.
D. achieve an annual growth rate of at least 10 percent.
E. make the most efficient use of the country's resources.
77) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market.
A. Brand familiarity
B. Market scanning
C. Market segmentation
D. Positioning
E. Customer relationship management (CRM)
78) Economists' economic-buyer theory assumes that __________.
A. demographic data are very useful for predicting consumer behavior
B. consumers should purchase only low-priced products
C. consumers always make rational decisions
D. buyers logically compare choices in order to maximize their satisfaction
E. consumers only want the cheapest price
79) A cluster analysis of the "toothpaste market" would probably show that:
A. the broad product-market can be served effectively with one marketing mix.
B. factors such as taste, price, and "sex appeal" are not important.
C. different market segments seek different product benefits.
D. most consumers are mainly concerned about brightness of teeth.
E. most consumers are concerned about cost.
80) Good marketing strategy planners know that:
A. firms like Nabisco and Wal-Mart are too large to aim at clearly defined target markets.
B. mass marketing is often very desirable and effective.
C. the terms "mass marketing" and "mass marketer" mean basically the same thing.
D. target marketing does not limit one to small market segments.
E. target markets cannot be large and spread out.
81) In comparison to the buying of final consumers, the purchasing of organizational buyers:
A. is strictly economic and not at all emotional.
B. leans basically toward economy, quality, and dependability.
C. is even less predictable.
D. is always based on competitive bids from multiple suppliers.
E. is always emotional.
82) An Australian wine producer, facing declining sales at home, set up a new channel of distribution to sell wine in the United States. This seems to be an effort at:
A. market development.
B. market penetration.
C. product development.
D. diversification.
E. stratification.
83) Coca-Cola is taking advantage of the new willingness of Chinese leaders to engage in international trade by marketing its soft drinks in China. What type of opportunity is Coke pursuing?
A. market development
B. product development
C. market penetration
D. diversification
E. test marketing
84) Marketing:
A. creates materialistic values which did not exist before.
B. reflects existing social values in the short run--while reinforcing these values in the long run.
C. is only propaganda.
D. turns consumers into puppets.
E. not important if you have a good product.
85) The clustering techniques that can be used in segmenting:
A. eliminate the need for management intuition and judgment.
B. try to find similar patterns within sets of data.
C. group people together based on age.
D. group people together into heterogeneous product-market segments.
E. looks for differences between groups of people.
86) The difference between target marketing and mass marketing is that target marketing:
A. means focusing on a small market.
B. focuses on specific customers, while mass marketing aims at an entire market.
C. does not rely on e-commerce but mass marketing does.
D. focuses on short-run objectives, while mass marketing focuses on long-run objectives.
E. aims at increased sales, while mass marketing focuses on increased profits.
87) "Positioning":
A. applies to new products--but not existing products.
B. is concerned with obtaining the best shelf space in retail outlets.
C. is useful for combining but not for segmenting.
D. helps strategy planners see how customers view competitors' offerings.
E. eliminates the need for judgment in strategy planning.
Legal and Social Environment
88) What type of commercial speech did the U.S. Supreme Court say was protected in the Greater New Orleans Broadcasting Association, Inc. v. United States case?
A. Information on gambling and lotteries.
B. Information about child pornography.
C. Information on how to build a bomb.
D. Obscene speech.
89) In which of the following are these steps of a criminal case listed in the correct order?
A. Arraignment, arrest, trial, indictment
B. Indictment, arraignment, arrest, trial
C. Arrest, arraignment, indictment, trial
D. Arrest, indictment, arraignment, trial
E. Arrest, indictment, trial, arraignment
90) Which of the following is correct about interpretive rules?
A. They require public notice and participation to create.
B. They must be accompanied by substantive rules.
C. They do not establish new law.
D. All federal administrative agencies have implied power to make interpretive rules.
E. Interpretive rules are not subject to judicial review.
91) Overtime pay is required to be paid to nonexempt employees who work:
A. Over 10 hours per day.
B. Over 12 hours per day.
C. Over 8 hours per day.
D. Over 40 hours per week.
E. Over 50 hours per week.
92) In responding to a constitutional challenge to the Computer Decency Act, the U.S. Supreme Court ruled that:
A. The Act was constitutional because obscene speech receives no protection.
B. Obscene materials could not be available between 6:00 a.m. and 10:00 p.m. local time.
C. Computers and the Internet were not covered by the free speech provisions of the U.S. Constitution because they did not exist when the Constitution was drafted.
D. The Act was unconstitutional because its provisions were too vague to define.
E. The Internet was similar to television and that restrictions similar to those on television programming were appropriate.
93) What makes a publicly held corporation different from a public corporation?
A. A publicly held corporation has many shareholders rather than being a corporation owned by a governmental entity.
B. A publicly held corporation is entitled to limited liability, but a public corporation is not.
C. A publicly held corporation must have a charitable purpose, but a public corporation need not have a charitable purpose.
D. They are two terms that have the same meaning.
94) Which of the following terms is not required to be disclosed under the Truth-in-Lending Act?
A. The date the finance charge begins to accrue.
B. The amount of attorneys fees to be charged if legal action is needed to collect the debt.
C. The annual percentage rage of interest.
D. The number of payments.
E. The amount of late charges or delinquency penalties.
95) Information which comes to the knowledge of an agent is:
A. Required to be communicated to the principal in all circumstances.
B. Is imputed to the principal.
C. Can be disclosed to the principal only with the third party’s consent.
D. Will result in termination of the agency arrangement if it is not communicated to the principal.
96) What is the major convention that provides international protection to patents?
A. The Berne Convention of 1786.
B. The General Agreement on Tariffs and Trade (GATT).
C. The Paris Convention.
D. The Digital Millennium Treaty.
97) Which of the following is not one of the Caux Round Table Principles for International Business?
A. Support for Multilateral Trade.
B. Promotion of Multiculturalism.
C. Avoidance of Illicit Operations.
D. Respect for the Environment.
E. Responsibility of Business Beyond Shareholders Toward Stakeholders.
International Issues
98) Which country does the text describe as becoming the largest producer and consumer of many of the world's goods?
A. Canada
B. Mexico
C. Japan
D. China
E. Ecuador
99) One study found that manufacturing labor costs about _____ an hour in China, compared to _____ dollars in the United States.
A. About $2; about 15
B. Less than $1; about 25
C. Less than $1; about 15
D. $2; about 25
E. Less than $1; about 40
100) Although the U.S. has had a longstanding agreement with _____ after the passage of NAFTA, _____ became the United States' second largest trading partner.
A. Canada, Mexico
B. Mexico, Canada
C. Canada, Venezuela
D. Mexico, Venezuela
