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Accounting - multiple choice

1. Sarbanes-Oxley legislation is not concerned with:
a) Improving internal control
b) Corporate governance
c) Monitoring of managers
d) Disclosure practices of private companies

2. Sales total $360,000 when variable costs total $270,000 and fixed costs total $80,000. The break-even point in sales dollars is:
a) $320,000
b) $270,000
c) $90,000
d) $80,000

3. In a job-costing system, allocation of manufacturing overhead to jobs is a credit to:
a) Work-in-Process Control
b) Manufacturing Overhead Allocated
c) Cash
d) Materials Control

4. An ABC system will provide benefits when:
a) products make diverse demand on resources due to volume differences.
b) there are no disagreement between the operations staff.
c) management does not want to estimate costs of activity pools.
d) None of the above

5. The first step in preparing an operations budget is:
a) identify the problems and uncertainties
b) to obtain information
c) make predictions about the future
d) choose among alternatives

6. A schedule of expected cash receipts and payments is a:
a) cash budget
b) statement of cash flows
c) balance sheet
d) all of the above

7. Actual results for operating income of $30,000 compared to budgeted operating income of $25,000 results in:
a) Unfavorable static budget variance
b) Favorable static budget variance
c) Favorable flexible budget variance
d) No variance

Solution Preview

1. Sarbanes-Oxley legislation is not concerned with:
a) Improving internal control
b) Corporate governance
c) Monitoring of managers
d) Disclosure practices of private companies

SOX pertains to public companies so private companies are not of interest. Pick D.

2. Sales total $360,000 when variable costs total $270,000 and fixed costs total $80,000. The break-even point in sales dollars is:
a) $320,000
b) $270,000
c) $90,000
d) $80,000
Fixed costs / contribution margin ratio = 80,000 / (360,000 - 270,000 / 360,000) = $320,000; Pick A

3. In a ...

Solution Summary

A sentence explains the choice suggested.

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