Chapter 13 - Small Business Accounting: Projecting and Evaluating Performance

net present value

To perform _____ analyses, only cash flows are considered.

Current ratio.

The value of current assets divided by current liabilities is called:

purchases

The _____ budget shows the number of units that are expected to be acquired during the budget period.

managerial accounting.

An accounting method that is specifically intended to be used for planning, directing, and controlling a business is called:

Total costs equal gross revenue.

Breakeven point is the point at which:

The going concern expectation

Larry owns a successful business called Super Car-Hire. He plans to sell it to Bob. Bob assumes that he can keep up the high revenues if he can plan and execute the mission of the business well. Which of the following basic accounting concepts is reflected in Bob's assumption?

depreciation

Regular and systematic reduction in income that transfers asset value to expense over time is called _____.

variance.

The difference between an actual and budgeted revenue or cost is called:

owners' equity.

The difference between assets and liabilities of a business is called its:

sales

The first step in preparing a master budget is to prepare a _____ budget.

Financial strength

_____ refers to the ability of a business to survive adverse financial events.

Payroll records

Which of the following accounting functions ensures that the employment taxes are kept current?

Fixed asset accounting

Which of the following accounting functions focuses the most on automatically calculating and accumulating depreciation?

Articulate concept

Which of the following concepts assume that information flows from the income statement through the statement of retained earnings, the statement of owners' equity to the balance sheet?

It produces financial reports that meet legal requirements.

Which of the following is a disadvantage of a computerized accounting system?

Balance sheet

Which of the following is a statement of what a business owns, what it owes to others, and how much value the owners have invested in it?

It is forward-looking in nature.

Which of the following is true of managerial accounting?

Inventory accounting facilitates maintenance of appropriate levels of inventory and aids in calculation of appropriate stocking and reorder levels.

Which of the following is true of typical accounting functions used in businesses?

it's values are considered as historical values.

Which of the following statements is true regarding the balance sheet?

Economy of scale

_____ is the idea that it is cheaper (per item) to make many of an item than few.