BUS 475 Final Exam Study Guide 2012 � Set 2

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BUS 475 Final Exam Study Guide 2012–Set 2100 Answers from 2012 BUS/475 Final ExamReviewed and Prepared by ACCNerd.com. Thank you!1) Disney’s variable costs are 30% of sales. The company is contemplating an advertising campaignthat will cost$22,000. If sales are expected to increase $40,000, by how much will the company'snet income increase?A.$12,000B.$18,000C.$6,000D.$28,0002) Multinational corporations __________.A.are firms that conduct their operations in morethan one country through subsidiaries, divisions,or branches in foreign countriesB.are U.S. companies that sell goods and services in other countriesC.are required to use international accounting standardsD.are U.S. companies that trade their securities on the exchanges in other countries3) Balance sheet accounts are considered to be __________.A.capital accountsB.nominal accountsC.temporary stockholders’ accountsD.permanent accounts4) What is value chain management best defined as?A.The incremental value of costs associated with hiring a new production floor leaderB.All activities associated with providing a product or serviceC.A large chain that keeps the machines from falling on the production floorD.Management decisions that affect how quickly the production run occurs5) The primary purpose of the statement of cash flows is to __________.A.provide information about the cash receipts and cash payments during a periodB.facilitate banking relationshipsC.provide information about the investing and financing activities during a periodD.prove that revenues exceed expenses if there is a net income6) In what situations will a static budget be most effective in evaluating a manager's effectiveness?A.The planned activity levels match actual activity levels.B.The company has no fixed costs.C.The company has substantial fixed costs.D.The company has substantial variable costs.7) Which one of the following is a product cost?A.Sales person’s salaries

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B.Advertising costsC.Indirect laborD.Office salaries8) These are selected account balances on December 31, 2008.Land (location of the corporation's office building)$100,000Land (held for future use)150,000Corporate Office Building600,000Inventory200,000Equipment450,000Office Furniture100,000Accumulated Depreciation300,000What is the net amount of property, plant, and equipment that will appear on the balance sheet?A.$1,600,000B.$950,000C.$1,300,000D.$1,100,0009) Of the following companies, which one would not likely employ the specific identificationmethod for inventory costing?A.Antique shopB.Music store specializing in organ salesC.Hardware storeD.Farm implement dealership10) If a company reports a net loss, it __________.A.will not be able to get a loanB.may still have a net increase in cashC.will not be able to make capital expendituresD.will not be able to pay cash dividends11) The income statement and balance sheet columns of Pine Company's worksheet reflects thefollowing totals:Income StatementBalance SheetDr.Cr.Dr.Cr.Totals$58,000$48,000$34,000$44,000To enter the net income (or loss) for the period into the above worksheet requires an entry to the__________.A.income statement debit column and the income statement credit columnB.income statement credit column and the balance sheet debit columnC.income statement debit column and thebalance sheet credit columnD.balance sheet debit column and the balance sheet credit column12) The cost principle requires that when assets are acquired, they be recorded at __________.A.selling priceB.appraisal value

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C.list priceD.exchange price paid13) Which one of the following items is not generally used in preparing a statement of cash flows?A.Current income statementB.Adjusted trial balanceC.Additional informationD.Comparative balance sheets14) Managerial accounting __________.A.pertains to the entity as a whole and is highly aggregatedB.is concerned with costing productsC.places emphasis on special-purpose informationD.is governed by generally accepted accounting principles15) A logical starting point from which the study of international trade begins is __________.A.the principle of absolute advantageB.the recognition that not all markets are competitiveC.the principle of comparative advantageD.the recognition that government intervention in markets sometimes enhances the economicwelfare of the society16) Without trade, __________.A.a country can still benefit from international specializationB.a country is better off because it will have to learn to be self-sufficient without tradeC.interdependence is more extensive than it would be with tradeD.a country's production possibilities frontier is also its consumption possibilities frontier17) Assume oligopoly firms are profit maximizers, they do not form a cartel, and they take otherfirms' production levels as given. Then in equilibrium the output effect __________.A.must balance with the price effectB.must dominate the price effectC.must be smaller than the price effectD.can be larger or smaller than the price effect18) To move the allocation of resources closer to the social optimum, policymakers should typicallytry to induce firms in an oligopoly to __________.A.compete rather than cooperate with each otherB.collude with each otherC.form various degrees of cartelsD.cooperate rather than compete with each other19) When, in a particular market, the law of demand and the law of supply both apply, theimposition of a binding price ceiling in that market causes quantity demanded to be __________.A.equal to quantity suppliedB.greater than quantity supplied

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C.less than quantity suppliedD.double the quantity supplied20) If a price ceiling is a binding constraint on the market, __________.A.sellerscannot sell all they want to sell at the price ceilingB.the equilibrium price must be below the price ceilingC.there is excess supplyD.buyers cannot buy all they want to buy at the price ceiling21) A tax on an imported good is called a __________.A.supply taxB.quotaC.tariffD.trade tax22) The political business cycle refers to __________.A.the part of the business cycle caused by the reluctance of politicians to smooth the business cycleB.the fact that about everyfour years some politician advocates greater government control of theFedC.the potential for a central bank to increase the money supply and therefore real GDP to help theincumbent get re-electedD.changes in output created by the monetary rule the Fed must follow23) Real GDP __________.A.is not a valid measure of the economy's performance, since prices change from year to year.B.evaluates current production at current prices.C.evaluates current production at the prices that prevailed in some specific year in the past.D.is a measure of the value of goods only; it excludes the value of services.24) The model of short-run economic fluctuations focuses on the price level and __________.A.the neutrality of moneyB.real GDPC.economic growthD.Net GDP25) In the market for foreign-currency exchange in the open economy macroeconomic model, theamount of net capital outflow represents the quantity of dollars __________.A.demanded for the purpose of buying U.S. net exports of goods and servicesB.supplied for the purpose of buying assets abroadC.supplied for the purpose of selling assets domesticallyD.demanded for the purpose of importing foreign goods and services26) The open-economy macroeconomic model examines the determination of __________.A.the output growth rate and the inflation rateB.unemployment and the exchange rateC.the output growth rate and the real interest rateD.the trade balance and the exchange rate27) The balance of payment account is made up of:

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