Econ

Grummet Company is acquiring a new wood lathe with a cash purchase price of $80,000 The Wood Master Industries (the manufacturer) has agreed to accept $23,500 at the end of each of the next 4 years. Based on this deal, how much interest will Grummet pay over the life of the loan?

$14,000

The SASB view on materiality has been adapted from which of the following?

The Supreme Court

Goal congruence in well-designed performance measurement systems best explains a congruence between

employees of a company

How many broad categories of capital are identified by the Integrated Reporting Framework?

6

Which of the following is not a common goal of an organization?

being acquired by another business

Good corporate citizenship

makes good business sense

Which form of energy is renewable?

solar

The most common budget is prepared for a________

Year

Which of the following is true in a bottom-up budgeting approach?

Departments determine their needs and relate them to the overall goals.

The process that determines the present value of a single payment or stream of payments to be received is

Discounting

A good performance measurement system will include which of the following?

Neither abc

Segments are uniquely identifiable components of the business and can be categorized by all of the following except

Number of employees

________are the costs associated with not choosing the other alternative.

Opportunity cost

_______is the act of using another company to provide goods or services that your company requires.

Outsourcing

Which agreement did 196 nations adopt in December 2015?

Paris Climate Agreement

Youngstown Construction plans to discontinue its roofing segment. Last year, this segment generated a contribution margin of $65,000 and incurred $70,000 in fixed costs. Discontinuing the segment will allow the company to avoid half of the fixed costs. What effect is expected to occur to the company's overall profit?

a decrease of $30,000

When managerial accountants design an evaluation system that is based on criteria for which a manager is responsible, and it is structured to encourage managers to make decisions that will meet the goals of the company as well as their own personal job goals, the framework used is ________.

a responsibility accounting framework

Which of the following does not describe a management control system?

a system that only measures profitability

Sustainability reporting can incorporate which of the following?

all of the above

Which is not a section of the cash budget?

allowance for uncollectible accounts

In centralized organizations, primary decisions are made by______

an individual at the top of the organization

Which of the following best defines stakeholders?

anyone directly or indirectly affected by the organization

The NPV method assumes that cash inflows associated with a particular investment occur when?

at any of these times

Which approach is most likely to result in employee buy-in to the budget?

bottom up approach

Which of the following is a finance budget?

cash budget

The process of reinvesting interest earned to generate additional earnings over time is ________.

compounding

Which of the following is not a type of responsibility center?

concentrated cost center

Which of the following is not one of the five steps in the decision-making process?

consult with CFO concerning variable costs

The fundamental tenets of SASB's Approach are considered

evidence-based, industry-specific, and market-informed

This variance is the difference involving spending less, or using less than the standard amount.

favorable variance

Which budget evaluates the results of operations at the actual level of activity?

flexible budget

A flexible budget_______

predicts estimated revenues and costs at varying levels of production

Which of the following is not a part of budgeting?

preventing net operating losses

Which of the following is an operating budget?

production budget

When operating in a constrained environment, which products should be produced?

products with the highest contribution margin per unit of the constrained process

Which of the following is not a qualitative decision that should be considered in an outsourcing decision?

relevant costs

Which of the operating budgets is prepared first?

sales budget

What are some possible reasons for a material price variance?

substandard material

Which type of incurred costs are not relevant in decision-making (i.e., they have no bearing on future events) and should be excluded in decision-making?

sunk costs

Managers in decentralized organizations make decisions relating to all of the following except

the company's stock price

A good performance measurement system will align the goals of management with_____

the goals of the corporation, and both parties will benefit

The IRR method assumes that cash flows are reinvested at______

the internal rate of return

The cost of equity is

the rate of return required by investors to incentivize them to invest in a company

Performance measures are only useful if______

there is a baseline against which to compare the measured results

Why does a company use a standard costing system?

to identify variances from actual cost that assist them in maintaining profits

Components of the organization that are demotivating for purposes of performance management are known as

uncontrollable factors

This variance is the difference involving spending more or using more than the standard amount.

unfavorable variance

When is the material price variance favorable?

when the actual price is less than the standard price

When is the material price variance unfavorable?

when the actual price paid is greater than the standard price

The managerial decision-making process has which of the following as its third step?

Perform a comprehensive differential (differential) analysis of potential solutions.

Which of the following is sometimes referred to as the "Anti Chain Store Act"?

Robinson-Patman Act

You are explaining time value of money factors to your friend Which factor would you explain as being larger?

The future value of $1 for 12 periods at 6% is larger.

In a centralized organization, where are goals established?

at the highest level of the organization and promoted downward

Which standards are considered universal under the GRI?

foundation, general disclosures, management approach

If you are saving the same amount each month in order to buy a new sports car when the new models are released, which of the following will help you determine the savings needed?

future value of an ordinary annuity

The third step for making a capital investment decision is to establish baseline criteria for alternatives. Which of the following would not be an acceptable baseline criterion?

inventory turnover

Which of the following is a disadvantage of outsourcing?

limiting ability to upsize or downsize production

Without proper performance measures, goal congruence is almost impossible to achieve and will likely lead to______

lost profits and dissatisfied employees

What are some reasons for a material quantity variance?

more qualified workers

Responsibility accounting holds managers responsible for

only the costs that they can control

Preference decisions compare potential projects that meet screening decision criteria and will be ranked in their preference order to differentiate between alternatives with respect to all of the following characteristics except____

political prominence

Capital investment decisions often involve all of the following except

short periods of time

Organizational charts________

show the structure of an organization

Which approach requires management to justify all its expenditures?

zero-based budgeting

Which of the following statements is most often the case?

Socially responsible businesses tend to post higher profits than those not focused on social responsibility.

This standard is set at a level that may be reached with reasonable effort.

attainable standard

Which of the following is not a characteristic of a good performance measurement system?

based on activities over which managers have no control or influence

This standard is set at a level that could be achieved if everything ran perfectly.

ideal standard