BUS 475 final exam

$42.00

Description

1) A well-designed
activity-based costing system starts with __________.

A. identifying
the activity-cost pools

B. assigning
manufacturing overhead costs for each activity cost pool to products

C. computing
the activity-based overhead rate

D. analyzing
the activities performed to manufacture a product

2) In what
situations will a static budget be most effective in evaluating a manager’s
effectiveness?

A. The
company has substantial fixed costs.

B. The
planned activity levels match actual activity levels.

C. The
company has substantial variable costs.

D. The
company has no fixed costs.

3) The conceptual
framework developed by the Financial Accounting Standards Board __________.

A. was
approved by a vote of all accountants

B. is
viewed as providing a constitution for setting accounting standards for
financial reporting

C. are
rules that all accountants must follow

D. is
legally binding on all accountants

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?

A. $18,000

B. $12,000

C. $28,000

D. $6,000

5) Of the following
companies, which one would not likely employ the specific identification
method for inventory costing?

A. Music
store specializing in organ sales

B. Antique
shop

C. Farm
implement dealership

D. Hardware
store

6) These are selected account balances on
December 31, 2008.

Land
(location of the corporation’s office building)

$100,000

Land
(held for future use)

150,000

Corporate
Office Building

600,000

Inventory

200,000

Equipment

450,000

Office
Furniture

100,000

Accumulated
Depreciation

300,000


What is the net amount of property, plant, and equipment that will appear on
the balance sheet?

A. $1,300,000

B. $1,600,000

C. $1,100,000

D. $950,000

7) Which one of the
following items is not generally used in preparing a statement of cash flows?

A. Adjusted
trial balance

B. Current
income statement

C. Comparative
balance sheets

D. Additional
information

8) The income statement and balance sheet
columns of Pine Company’s worksheet reflects the following totals:

Income
Statement

Balance
Sheet

Dr.

Cr.

Dr.

Cr.

Totals

$58,000

$48,000

$34,000

$44,000


The net income (or loss) for the period is __________.

A. $48,000
income

B. $10,000
loss

C. $10,000
income

D. not
determinable

9) What effect do
current technology changes have on managerial accounting?

A. Creation
of the middleman

B. Reduction
of emphasis on the value chain

C. Increase
in product costs

D. Reduction
of reporting costs of managerial accounting information

10) 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?

A. Factory
janitor

B. Cost
of landscaping the corporate office

C. General
corporate liability insurance

D. The
western division’s vice president’s salary

11) The major
reporting standard for management accounts is __________.

A. the
Standards of Ethical Conduct for Practitioners of Management Accounting
and Financial Management

B. relevance
to decisions

C. the
Sarbanes-Oxley Act of 2002

D. generally
accepted accounting principles

12) Which list below
best describes the major services performed by public accountants?

A. Cost
accounting, production scheduling, recruiting

B. Auditing,
taxation, management consulting

C. Employee
training, auditing, bookkeeping

D. Bookkeeping,
mergers, budgets

13) 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?

A. 2,133
units

B. 6,200
units

C. $25,600

D. 4,600
units

14) Managerial
accounting __________.

A. places
emphasis on special-purpose information

B. pertains
to the entity as a whole and is highly aggregated

C. is
governed by generally accepted accounting principles

D. is
concerned with costing products

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. $300

B. $100

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)
A tax on an imported good is called a __________.

A. trade
tax

B. supply
tax

C. tariff

D. quota

17)
Lekeisha’s income exceeds her expenditures. Lekeisha is a __________.

A. borrower
who supplies money to the financial system

B. borrower
who demands money from the financial system

C. saver
who supplies money to the financial system

D. saver
who demands money from the financial system

18)
Lucy starts her own psychiatric practice, but her expenditures to open the
practice exceed her income. Lucy is a __________.

A. borrower
who supplies money to the financial system

B. borrower
who demands money from the financial system

C. saver
who supplies money to the financial system

D. saver
who demands money from the financial system

19)
A rational decision maker __________.

A. takes
an action only if the combined benefits of that action and previous
actions exceed the combined costs of that action and previous actions

B. takes
an action only if the marginal benefit of that action exceeds the marginal
cost of that action

C. ignores
the likely effects of government policies when he or she makes choices

D. ignores
marginal changes and focuses instead on “the big picture”

20)
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

21)
Without trade, __________.

A. interdependence
is more extensive than it would be with trade

B. a
country can still benefit from international specialization

C. a
country’s production possibilities frontier is also its consumption possibilities
frontier

D. a
country is better off because it will have to learn to be self-sufficient
without trade

22)
The open-economy macroeconomic model includes __________.

A. neither
the market for loanable funds or the market for foreign-currency exchange

B. both
the market for loanable funds and the market for foreign-currency exchange

C. only
the market for foreign-currency exchange

D. only
the market for loanable funds

23)
The political business cycle refers to __________.

A. changes
in output created by the monetary rule the Fed must follow

B. the
part of the business cycle caused by the reluctance of politicians to
smooth the business cycle

C. the
potential for a central bank to increase the money supply and therefore
real GDP to help the incumbent get re-elected

D. the
fact that about every four years some politician advocates greater
government control of the Fed

24)
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. Only
item (2) is included in GDP and it is included in the investment
component.

B. Item
(1) is included in the investment component, while item (2) is included in
the consumption 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.

25)
The part of the balance of payments account that lists all long-term flows of
payments is called the:

A. financial
and capital account.

B. current
account.

C. balance
of trade.

D. government
financial account.

26)
Real GDP __________.

A. evaluates
current production at the prices that prevailed in some specific year in
the past.

B. evaluates
current production at current prices.

C. is
a measure of the value of goods only; it excludes the value of services.

D. is
not a valid measure of the economy’s performance, since prices change from
year to year.

27)
The open-economy macroeconomic model examines the determination of
__________.

A. unemployment
and the exchange rate

B. the
output growth rate and the real interest rate

C. the
trade balance and the exchange rate

D. the
output growth rate and the inflation rate

28)
An invisible barrier that makes it difficult for certain groups, such as
minorities and women, to move beyond a certain level in the organizational
hierarchy is referred to as the:

A. Job
enrichment theory

B. Black
box theory

C. Glass
floor

D. Glass
ceiling

E. Job
enlargement concept

29)
The basic components of an effective sexual harassment policy include the
following EXCEPT:

A. To
establish a formal complaint procedure

B. To
develop an organization wide policy on sexual harassment

C. To
establish a means for ongoing training

D. To
establish a performance appraisal system

E. To
act immediately when employees complain of sexual harassment

30)
A leader is:

A. A
strategic level manager

B. Someone
with authority over others

C. Someone
well-respected by others

D. The
top level manager in a firm or business

E. Someone
who influences others to attain goals

31)
Teams that operate separately from the regular work structure and exist
temporarily are known as:

A. Self-designing
teams

B. Management
teams

C. Transnational
teams

D. Parallel
teams

E. Self-managed
teams

32)
Which of these describes a vision, as it pertains to leadership?

A. The
method through which leaders achieve goals

B. A
long-term goal of an organization

C. A
short-term goal of an organization

D. A
mental image of a future state of an organization

E. Likely
to land you in a padded room

33)
Japanese manufacturers’ kaizen (continuous improvement) programs enable them
to maintain:

A. Larger,
faster facilities

B. A
strategic alliance

C. A
homogeneous workforce

D. A
Learning advantage over their competition

E. Positive
working relationships with all employees

34)
The term used to refer to all kinds of differences including religious
affiliation, age, disability status, economic class and lifestyle in addition
to gender, race, ethnicity and nationality is:

A. Selection

B. Diversity

C. Managerial
ethics

D. Employment

E. Recruiting

35)
A manager’s ability to stimulate people to be high performers is referred to
as:

A. Leading

B. Planning

C. Staffing

D. Organizing

E. Controlling

36)
Which of the following has proven to be a particularly good predictor for
jobs that require cognitive complexity?

A. work
sampling

B. intelligence
tests

C. behavioral
assessment

D. integrity
evaluations

E. aptitude
tests

37)
The best way for an employer to find out if a potential employee can do a job
is by __________.

A. using
the interview process

B. having
them spend a day in the office

C. using
a written test

D. using
a performance simulation test

E. administering
an IQ test

38)
A series of quality standards developed by a committee working under the
International Organization for Standardization to improve total quality in
all businesses for the benefit of both producers and consumers is:

A. Total
quality management

B. ISO
9000

C. Just-in-time
control (JIT)

D. Customer-based
integration

E. Computer-integrated
manufacturing (CIM)

39)
Which of the following statements does NOT support Total Quality Management?

A. Strive
for long-term improvement rather than short-term profit

B. Build
long-term relationships instead of awarding business on price tag alone

C. Break
down barriers among departments

D. Creating
silos between departments

E. Use
numerical quotas

40)
Building a dynamic organization is another way of describing which function
of management?

A. Planning

B. Leading

C. Organizing

D. Staffing

E. Controlling

41)
The pursuit of lucrative opportunities by enterprising individuals is called:

A. Intrapreneurship

B. Business
incubating

C. Independence

D. Social
experimentation

E. Entrepreneurship

42)
Use the following table to answer question:
.gif” alt=”https://asap.phoenix.edu/student/images/upload/BUS475_4-8.gif”>

P(S | W) is approximately _____.

A. .12

B. .30

C. .40

D. .58

43)
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.gif” alt=”https://asap.phoenix.edu/student/images/upload/alpha.gif”>= .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

44)
Thirty patients are selected from a filing cabinet containing 812 patient
folders by choosing every 27th patient folder. Which sampling method is this?

A. Cluster
sample

B. Stratified
sample

C. Systematic
sample

D. Simple
random sample

45)
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 __________.

A. none
of these are correct

B. wealthy
individuals tend to commit more crimes

C. crime
creates additional income in a city

D. the
slope is not significantly different from zero

46)
Which of the following statements is true?

A. If
event (A) occurs, then its complement (A‘) will also occur.

B. The
probability of A and its complement (A‘) will always sum to
one.

C. The
sum of two mutually exclusive events is one.

D. If
A and B are independent events, the P(B) = P(A)
P(B).

47)
Independent events A and B would be consistent with which of the following
statements:

A. P
(A) = .4, P (B) = .5, P (A.gif” alt=”https://asap.phoenix.edu/student/images/upload/intersection.gif”>B) = .2

B. P
(A) = .3, P (B) = .5, P (A.gif” alt=”https://asap.phoenix.edu/student/images/upload/intersection.gif”>B) = .4

C. P
(A) = .4, P (B) = .3, P (A.gif” alt=”https://asap.phoenix.edu/student/images/upload/intersection.gif”>B) = .5

D. P
(A) = .5, P (B) = .4, P (A.gif” alt=”https://asap.phoenix.edu/student/images/upload/intersection.gif”>B) = .3

48)
In an activity-on-node [AON] network, the nodes represent ____________,
whereas the arcs represent ____________.

A. activities;
time

B. activities;
precedence relationships

C. events;
activities

D. precedence
relationships; time

49)
Assume that the arrival of airplanes at a one-runway airport is a Poisson
distribution with a mean rate of
.gif” alt=”https://asap.phoenix.edu/student/images/upload/lambda.gif”>= 8 planes per hour.
The landing time is an exponential distribution with a mean of 5 minutes per
plane. What is the mean number of planes in the system?

A. 1.67

B. 1.33

C. 1

D. 2

50)
In statistical process control a p-chart could __________.

A. have
more than one characteristics

B. measure
the fraction of conforming parts in a sample

C. measure
the number of defects per sample unit

D. use
the student’s distribution

51)
Which one of the following statements concerning production and staffing
plans is best?

A. When
production and staffing plans are made, aggregation can be performed only
along two dimensions: products and time.

B. Production
and staffing plans attempt to achieve several objectives, all of which must
be consistent with one another.

C. Production
and staffing plans specify production rates, workforce levels, and
inventory holdings, but do not account for capacity limitations because
they are aggregated.

D. The
impact of production and staffing plans cuts across several functional
areas of the firm.

52)
Companies using lean systems generally have:

A. suppliers
that are willing to accept short-term contracts.

B. suppliers
that are located nearby to decrease delivery lead time.

C. many
suppliers to ensure that material shortages never occur.

D. suppliers
who are low-cost producers.

53)
The Global, Web-Based Platform enables individuals to do which of the
following?

A. produce
and sell goods and services

B. exchange
knowledge

C. connect,
compute, communicate, collaborate, and compete everywhere and all the time

D. all
of these are true

E. access
information, services, and entertainment

54)
Zappos built the majority of its information systems using which of the
following?

A. Free
software

B. Open
source software

C. Vendor
software

D. Consultants

E. Proprietary
software

55)
Which of the following are disadvantages of the buy option for acquiring IS
applications?

A. software
may not integrate with existing systems

B. company
will not have control over software improvements

C. software
may not exactly meet the company’s needs

D. all
of the these are disadvantages

E. software
may be impossible to modify

56)
Fundamental points about network computing in organizations include all of
the following except:

A. Networks
have had limited impact on organizational productivity

B. Networks
can be of any size, from small to enormous

C. Computers
constantly exchange data

D. Networks
support new ways of doing business

E. Computer
data exchange provides significant advantages to organizations

57)
The force behind globalization in _____ was the amount of muscle, horsepower,
wind power, or steam power that a country could deploy.

A. Globalization
3.0

B. Globalization
2.0

C. Globalization
1.0

D. None
of these

58)
Which of the following is not a reason that managers need IT support?

A. Need
to access remote information sources

B. Decisions
are becoming more complex

C. Number
of alternatives are decreasing

D. Decision
makers are often in different locations

E. Decisions
must typically be made under time pressure

59)
__________ integrate the planning, management, and use of all of an
organization’s resources, and are designed to tightly integrate the
functional areas of the organization.

A. Enterprise
resource planning systems

B. Functional
area information systems

C. Transaction
processing systems

D. Corporate
extranets

E. Supply
chain management systems

60)
Computer support is greatest for which of the following problems?

A. Semistructured
and management control

B. Structured
and operational control

C. Semistructured
and strategic planning

D. Structured
and management control

E. Unstructured
and operational control

61)
Which of the following is not a function of functional area information
systems?

A. supports
the managerial tasks of planning, organizing, and controlling operations

B. provides
analysis capabilities to middle level managers and staff

C. provides
information mainly in the form of reports

D. provides
information to managers in the functional areas

E. provides
data from business events to the corporate database

62)
_____ is the acquisition and efficient use of resources in accomplishing
organizational goals.

A. Management
control

B. Wisdom

C. Strategic
planning

D. Operational
control

E. Expertise

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. 20.62%

B. 15.62%

C. 9.37%

D. 14.37%

64)
Dublin International Corporation’s marginal tax rate is 40%. It can issue
three-year bonds with a coupon rate of 8.5% and par value of $1,000. The
bonds can be sold now at a price of $938.90 each. The underwriters will
charge $23 per bond in flotation costs. Determine the approximate after-tax
cost of debt for Dublin International to use in a capital budgeting analysis.

A. 5.1%

B. 9.2%

C. 6.0%

D. 8.5%

65) Your company is
considering an investment in a project which would require an initial outlay
of $300,000 and produce expected cash flows in Years 1 through 5 of $87,385
per year. You have determined that the current after-tax cost of the firm’s
capital (required rate of return) for each source of financing is as follows:

Cost of debt

8%

Cost of preferred stock

12%

Cost of common stock

16%


Long-term debt currently makes up 20% of the capital structure, preferred
stock 10%, and common stock 70%. What is the net present value of this
project?

A. $463

B. $1,568

C. $871

D. $1,241

66) You hold a
portfolio with the following securities:

Security

Percent of Portfolio

Beta

Return

X Corporation

20%

1.35

14%

Y Corporation

35%

.95

10%

Z Corporation

45%

.75

8%


Compute the expected return and beta for the portfolio.

A. 10.67%,
1.02

B. 9.9%,
.94

C. 9.9%,
1.02

D. 34.4%,
.94

67)
A machine costs $1,000, has a three-year life, and has an estimated salvage
value of $100. It will generate after-tax annual cash flows (ACF) of $600 a
year, starting next year. If your required rate of return for the project is
10%, what is the NPV of this investment? (Round your answerwer to the nearest
$10.)

A. $490

B. -$150

C. $570

D. $900

68)
The common stockholders are most concerned with:

A. the
percentage of profits retained.

B. the
spread between the return generated on new investments and the investor’s
required rate of return.

C. the
size of the firm’s beginning earnings per share.

D. the
risk of the investment.

69)
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. 13.6%

C. 12.5%

D. 8.0%

70)
Suppose you determine that the NPV of a project is $1,525,855. What does that
mean?

A. In
all cases, investing in this project would be better than investing in a
project that has an NPV of $850,000.

B. The
project’s IRR would have to be less that the firm’s discount rate.

C. The
project would add value to the firm.

D. Under
all conditions, the project’s payback would be less than the profitability
index.

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)
According to the hedging principle, permanent assets should be financed with
_____ liabilities.

A. permanent

B. fixed

C. spontaneous

D. current

73)
What is the yield to maturity of a nine-year bond that pays a coupon rate of
20% per year, has a $1,000 par value, and is currently priced at $1,407?
Round your answer to the nearest whole percent and assume annual coupon
payments.

A. 5%

B. 11%

C. 14%

D. 12%

74)
Tri State Pickle Company preferred stock pays a perpetual annual dividend of
2 1/2% of its par value. Par value of TSP preferred stock is $100 per share.
If investors’ required rate of return on this stock is 15%, what is the value
of per share?

A. $37.50

B. $6.00

C. $15.00

D. $16.67

75)
Exchange rate risk:

A. doesn’t
affect trades made in US Dollars.

B. has
been phased out due to recent international legislation.

C. applies
only to certain types of domestic businesses.

D. arises
from the fact that the spot exchange rate on a future date is a random
variable.

88)
Minimum wages, hours of employment, and child labor are regulated by the:

89)
Which of the following receives at least some protection under the U.S.
Constitution?

A. Offensive
speech

B. Obscene
speech

C. Neither
obscene speech nor offensive speech

D. Both
obscene speech and offensive speech

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