SEVI FINAL
Managerial accounting
As a corporate accountant for an information technology company, Simon provides the firm's managers and employees with the information they need to make decisions about the firm's financing, investing, marketing, and operating activities. What type of accounting does Simon practice? Managerial accounting Financial accounting Tax accounting Cost accounting
Long-term financing
Batini plans to start up a new tattoo parlor in town. To open her parlor, Batini takes out a three-year, $20,000 small business loan from a local bank. She uses the money to lease a building and purchase necessary equipment. This loan represents which of the following? Speculative production The risk-return ratio Long-term financing Short-term financing
Stock-out costs
Demond owns an automobile parts store. Demond estimates that he loses $46,500 in sales annually due to parts that are not in stock at his store when customers come in to purchase them, and he would like to substantially reduce this number. Which of the following refers to sales lost when items are not in inventory? Direct-response marketing Stock-out costs Logistics Holding costs
Brand loyalty
In operating his flower shop, Julian has decided to use cost-based pricing as his pricing strategy. Which of the following is not a recognized element of cost-based pricing? Brand loyalty Fixed costs The breakeven quantity Variable costs
Decrease the firm's advertising budget
Javiera owns and manages a successful business equipment manufacturing company in Las Cruces, New Mexico. To build upon her entrepreneurial success, Javiera plans to significantly expand the number and types of business equipment offered to customers. The major ways to improve a product mix include all but which of the following? Delete a product Change an existing product Develop a new product Decrease the firm's advertising budget
A news release
Joel is an electrician operating as a sole proprietor in his hometown of Joliet, Illinois. Joel has purchased uniforms for the local Little League baseball team, and he has directed his assistant to prepare a three 300-word-or-less announcement of his sponsorship of the Little League team to be distributed to local media for publication. This type of publicity is known as which of the following? A news release A feature article Direct marketing A press conferral
Selective-demand
As a newly promoted marketing director for her firm, Aditi is crafting a new promotional strategy for her company that will focus on advertising. Which of the following is the most common form of advertising? Selective-demand Complimentary Primary-demand Institutional
A private brand
Food Lion is an American grocery store chain headquartered in Salisbury, North Carolina. In 2016, Food Lion launched its new "Cha-Ching" brand of grocery products. According to the company, Cha-Ching brand items are "budget-approved with satisfaction guaranteed. Enjoy unbeatable values on everything from bread and sugar to canned goods and household essentials. Now that's quality you can feel great about!" Food Lion's Cha-Ching brand is which of the following? A generic brand A manufacturer brand A producer brand A private brand
Sales allowances
T.J. Maxx, an American department store chain, offers price reductions to customers who are willing to purchase slightly damaged merchandise. Which of the following refers to this practice? Sales allowances Sales returns Net sales Sales discounts
Cash flow
Last month, the seafood restaurant Mariana owns and operates took in $157,350 in total receipts, and spent $142, 575 in total fixed and variable costs. This movement of money into and out of Mariana's restaurant represents which of the following? Short-term financing Speculative production Long-term financing Cash flow
A rebate
Periodically, Cooper Tire & Rubber Company will return part of the purchase price of set of four tires if the consumer submits the appropriate form (including proof of purchase) by a designated deadline. What type of sales promotion is this? A premium A rebate A coupon A buying allowance
Price skimming
When the digital video disc (DVD) format was first introduced in 1996, DVD players cost approximately $1,000. Today, a DVD player can be purchased for less than $40. What type of pricing strategy did the sellers of DVD players use in the 1990s? Psychological pricing Price skimming Penetration pricing Differential pricing
It is the coordination of primary marketing channel activities associated with the flow and transformation of products from the wholesaler to the retailer.
Aarav, a business student at the local community college, has been studying the concept of supply chain management in his Introduction to Business class. Which of the following is not true regarding supply chain management? It accelerates order-cycle times and increases profits for all channel members. It encourages cooperation in reducing the costs of inventory, transportation, administration, and handling. It is the coordination of primary marketing channel activities associated with the flow and transformation of products from the wholesaler to the retailer. It helps guarantee that customer needs are properly met.
A mortgage bond
Aditi is the majority shareholder of an industrial chemical supply corporation. To obtain much-needed operational capital, the company has issued a bond secured by its real estate holdings and equipment. Which of the following did Aditi's corporation issue? A debenture bond A mortgage bond A convertible bond A term-loan agreement
The prime rate
Advik just took out a short-term loan from the local bank for his alien novelty shop in Roswell, New Mexico. Due to his outstanding credit, Advik was fortunate enough to receive the lowest interest rate charged by the bank for a short-term loan. Advik received which of the following? The angel investor rate The financial leverage rate The prime rate The private placement rate
Cost-based
Alba has just purchased a food truck, and she is trying to determine the prices to charge for the various sandwiches and drinks she will be selling to her customers. Which of the following is the simplest method of pricing for Alba to adopt? Competition-based Demand-based Cost-based Equity-based
He is concerned with present and future sales levels, current inventory levels of resources, work in process, finished goods, and the availability and cost of the resources required to produce goods and services.
Aneko is an operations manager for an automotive parts manufacturing firm. Which of the following is correct regarding the informational requirements for his position? He must be aware of anything that pertains to his firm's employees. He needs to have detailed information about his firm's products and services and those offered by competitors. He must ensure that the company's managers and employees, lenders and suppliers, stockholders and potential investors, and government agencies have the information they need to measure the financial health of the company. He is concerned with present and future sales levels, current inventory levels of resources, work in process, finished goods, and the availability and cost of the resources required to produce goods and services.
The fundamental role of promotion has changed.
Antonia recently accepted a new job as a marketing manager, and her supervisor, Mia, has informed her that Antonia's primary responsibility will be to substantially improve integration of the firm's marketing communications. All but which of the following are correct regarding integrated marketing communications? It fosters the efficient use of promotional resources. Today, marketers take advantage of highly targeted promotional tools. Highly targeted promotional tools let marketers be more precise in targeting individual customers. The fundamental role of promotion has changed.
Most large corporations distribute all their after-tax earnings to stockholders.
As a Master of Business Administration (MBA) student, Ingrid is learning about corporate retained earnings. Which of the following is incorrect regarding retained earnings? Reinvestment of retained earnings tends to increase the value of a firm's stock. The amount of retained earnings in any year is determined by corporate management. They are considered a form of equity financing. Most large corporations distribute all their after-tax earnings to stockholders.
Technologies such as blockchain, artificial intelligence and robotics can help improve efficiency, responsiveness, and transparency throughout the supply chain.
As a Master of Business Administration (MBA), Ijoma is well aware of the importance of effective supply chain management. Which of the following is true regarding the implementation of technology in supply chain management? Technology has moderately enhanced the implementation of supply chain management. Technologies such as blockchain, artificial intelligence and robotics can help improve efficiency, responsiveness, and transparency throughout the supply chain. Through computerized integrated information sharing, channel members increase costs but improve customer service. The end result is increased productivity by increasing inventory, increasing cycle time, and reducing wasted human effort.
It must ensure that the firm pays dividends to its shareholders.
As a budding entrepreneur, Haji is interested in the importance of effective financial management to the success of a business. Which of the following is incorrect regarding proper financial management? It must ensure that the firm's financing priorities are established in line with organizational goals and objectives. It must ensure that the firm's credit customers pay their bills on time. It must ensure that the firm pays dividends to its shareholders. It must ensure that the firm's spending is planned and controlled.
GAAPs have been developed to provide a set of guidelines and practices for companies across the world to report financial information in a uniform way.
As a certified public accountant (CPA), Tanvi understands the importance of audited financial statements. Which of the following is incorrect regarding the importance of audited financial statements? GAAPs have been developed to provide a set of guidelines and practices for companies across the world to report financial information in a uniform way. An audit and the resulting report does not guarantee that a company has not "cooked" the books. The purpose of an audit is to make sure that a firm's financial statements have been prepared in accordance with generally accepted accounting principles (GAAPs). An audit is an examination of a company's financial statements and the accounting practices that produced them.
Accounts receivable generally are paid within 30 to 60 days.
As a corporate accountant, Constanza understands the importance of correctly assessing a company's assets. Which of the following is correct regarding the assets of a firm? The liquidity of an asset is the each with which it can be converted into stock. Current assets are assets that can be converted quickly into cash or that will be used in three years or less. Accounts receivable generally are paid within 30 to 60 days. On a balance sheet, assets are listed in order from the least liquid to the most liquid.
An organization must ensure that it is fair to all units involved in the purchases.
As a loading dock supervisor, Oban has dealt with the "transfer pricing" term occasionally. Which of the following is correct regarding transfer pricing? The price is determined by calculating the demand for the product. It occurs when an organization sells a product to a state or the federal government. The price is determined regardless of the costs associated with the product. An organization must ensure that it is fair to all units involved in the purchases.
A "push" strategy normally stresses personal selling.
As a marketing director for a consumer electronics manufacturing firm, Bohai is trying to determine whether a "push" or a "pull" promotional strategy is best for her company's products. Which of the following is true regarding push and pull promotional strategies? With a "push" strategy, a marketer promotes directly to consumers to spur strong consumer demand for its products. A "push" strategy normally stresses personal selling. With a "pull" strategy, a producer promotes the product only to the next organization down the marketing channel, and each channel member in turn promotes to the next. "Push" and "pull" strategies are mutually exclusive.
A decision made without any information is a gamble.
As a student majoring in business administration, Haruto would like to learn more about the relationship between information available to a business decision-maker and risk. Which of the following is correct regarding this relationship? A decision made without any information is a gamble. Theoretically, with accurate and complete information, there is still some risk. Having accurate and complete information is common in business. Making decisions without any information is common in business.
Issuing business bankruptcy insurance
As a young entrepreneur who operates a recently launched landscaping business, Vicente would like to learn more about the traditional banking services provided to business clients. Which of the following is not one of those services? Issuing business bankruptcy insurance Providing professional advice Savings accounts Processing debit-card transactions
It is also referred to as the balance sheet.
As an accountant for an airplane manufacturing company, Beatriz prepares a statement of cash flows for inclusion in the company's annual report. Which of the following is incorrect regarding the statement of cash flows? Whereas a firm's balance sheet reports dollar values for assets, liabilities, and owners' equity, the statement of cash flows focuses on how much cash is on hand to pay the firm's bills. It is also referred to as the balance sheet. The information on the statement of cash flows can be used to evaluate decisions related to a firm's future investments and financing needs. It illustrates how the company's operating, investing, and financing activities affect cash during an accounting period.
The information required to form a financial ratio can be found in a firm's balance sheet, income statement, and statement of cash flows.
As an accountant who frequently prepares financial statements for firms, Hina is well-aware of the concept of the financial ratio. Which of the following is correct regarding a financial ratio? It is a number that shows the relationship between three or more elements of a firm's financial statements. Although it can accurately and effectively measure a firm's profitability and how often it sells its inventory, it cannot measure a firm's ability to pay its debts. The information required to form a financial ratio can be found in a firm's balance sheet, income statement, and statement of cash flows. Although it can be compared with a firm's past ratios from previous accounting periods, it cannot be accurately or effectively compared with the ratios of competitors, or with industry averages.
It forms the basis for the accounting process.
As an accounting major, Hannah appreciates the importance of the accounting equation. Which of the following is correct regarding the accounting equation? It shows the relationship between a firm's sales revenue and its expenditures. It forms the basis for the accounting process. Owners' equity is the difference between a firm's fixed costs and its variable costs. Liabilities include the resources a business owns.
It must ensure that the company "go public" with an initial public offering within the first ten years of the firm's existence.
As an executive manager for a paint manufacturing company, Patrick understands the importance of effective financial management to the success of his company. Which of the following is incorrect regarding proper financial management? It must ensure that the number of past due accounts owing money to the firm is reduced. It must ensure that the company "go public" with an initial public offering within the first ten years of the firm's existence. It must ensure that the funds required for paying the firm's taxes are available. It must ensure that bills the firm owes are paid promptly.
Innovations are entirely new products.
As the founders of Microsoft Corporation, Bill Gates and Paul Allen knew that the success of any company depends on the development of new and exciting products for customers. Which of the following is correct regarding the development of new products? In the test marketing phase, the organization completes plans for full-scale manufacturing and marketing and prepares budgets. Innovations are entirely new products. Imitations are variations of existing products that are intended for an established market. Adaptations are products designed to compete with existing products of other companies.
Product packaging is not a feature of non-price competition.
As the owner of a candle shop, Filipa has learned that she must not only be competitive in terms of her product pricing, but also that she must also be non-price competitive. Which of the following is incorrect regarding non-price competition? It is used most effectively when a seller can make its product stand out through distinctive product quality, customer service, or other features. Once customers have chosen a brand for non-price reasons, they may not be as attracted to competing businesses and brands. Product packaging is not a feature of non-price competition. Product differentiation is a method of non-price competition.
Cash flows from operating activities
Charlotte is an "in-house" accountant for a green energy manufacturing firm. In which section of the firm's statement of cash flows should Charlotte include adjustments that increase or decrease the amounts for accounts receivable, inventory, accounts payable, and income taxes payable? Cash flows from operating activities Cash flows from investing activities Cash flows from capital activities Cash flows from financing activities
The relationship between buyer behavior and price is an information rule that can guide a marketing manager in future product pricing decisions.
Claudia is a Master of Business Administration (MBA) student, and she is preparing a presentation for her class regarding the relationship between information rules and business decision making. Which of the following is correct regarding this relationship? Businesspeople often consider information rules as a waste of time. Information rules are the "great sympathizers" for all decision makers. The relationship between buyer behavior and price is an information rule that can guide a marketing manager in future product pricing decisions. An information rule emerges when research confirms the same results a majority of times in identical or similar circumstances.
A certificate of deposit (CD)
Dafina has been successful this year in the yogurt shop she owns and operates. In fact, Dafina has generated $9,500 in profit so far this year, and she chooses to deposit this money in the bank in case she needs it for her business in the future. In her arrangement with the bank, Dafina will leave her $9,500 on deposit for one year, and in return, the bank will pay her a specified rate of interest. The agreement between Dafina and the bank represents which of the following? A certificate of deposit (CD) A revolving credit agreement Collateral A line of credit
Like venture capitalists, angel investors are often more focused on helping a business or an entrepreneur succeed rather than earning huge profits.
Darius recently provided $25,000 in financial backing for his nephew Demond's start-up computer repair shop. Demond refers to his uncle Darius as his "angel" investor. Which of the following is incorrect regarding an angel investor? Like venture capitalists, angel investors are often more focused on helping a business or an entrepreneur succeed rather than earning huge profits. An angel investor is often a wealthy investor who provides financial backing for small business startups or entrepreneurs. Angel investors may provide more favorable financial terms when compared with venture capitalists. Angel investors can become an owner with equity in the business.
Set sales objectives in general, non-quantifiable terms.
Diogo is a sales manager for a commercial air conditioning, heating, and refrigeration company. His major responsibilities as a sales manager include all but which of the following? Adjusting the size of the sales force to meet changes in the firm's marketing plan. Attracting and hiring effective salespersons. Evaluate the operation holistically. Set sales objectives in general, non-quantifiable terms.
$4,122.09
Diogo owns a comic book and gaming shop. The store's net profit margin is 5.25 percent, and his net sales are $78,516. What is the store's net income after taxes? Based on the data provided, the store's net income after taxes cannot be calculated. $412,209 $4,122.09 $41,220.90
Commercial impracticability
During her last class lecture for Introduction to Business, Ramia's professor emphasized that before setting prices for a firm's products, marketers must establish pricing objectives that are aligned with organizational and marketing objectives. Which of the following is not a recognized pricing objective? Survival Commercial impracticability Profit maximization Target return on investment
Although it was a popular marketing method as late as the 1990s, its popularity has declined in recent decades due to the need for most organizations to reduce their marketing budgets.
During her last class lecture, Pasua, a university professor, emphasized to her business students the strategic method of integrated marketing communications. Which of the following is not true regarding this method? Although it was a popular marketing method as late as the 1990s, its popularity has declined in recent decades due to the need for most organizations to reduce their marketing budgets. A major goal of integrated marketing communications is to send a consistent message to customers. It fosters long-term customer relationships. It is the coordination of promotion efforts to ensure maximum informational and persuasive impact on customers.
A convertible bond
Effia is the majority shareholder of a publicly traded manufacturing corporation. To obtain required operational funding, the company has issued a bond to investors that can be exchanged, at the owner's option, for a specified number of shares of the corporation's common stock. Effia's company has issued which of the following? A convertible bond A debenture bond A term-loan agreement A mortgage bond
$515,950
Ethan is preparing the balance sheet for the small-engine repair business he operates as a sole proprietorship. Ethan's business liabilities total $342,500 and his owner's equity amounts to $173,450. Using the "accounting equation," what are Ethan's total business assets? -$169,050 $169,050 -$515,950 $515,950
She is concerned with the coordination of information.
Filipa is an administrative manager for a large construction company. Which of the following is correct regarding the informational requirements for her position? She must ensure that the company's managers and employees, lenders and suppliers, stockholders and potential investors, and government agencies have the information they need to measure the financial health of the company. She is concerned with present and future sales levels, current inventory levels of resources, work in process, finished goods, and the availability and cost of the resources required to produce goods and services. She is concerned with the coordination of information. She needs to have detailed information about her firm's products and services and those offered by competitors.
Its product line
Ford Motor Company sells a wide range of trucks, including the F-150 series, the Ford Ranger series, and the Ford Super Duty series. This wide range of trucks represents which of the following for Ford Motor Company? Its convenience products Its major equipment Its product mix Its product line
Collect the data; store the data; update the data; process the data into information; and present the information to users
Glada is a management information specialist at the university where she works. Glada understands that to provide information, an MIS must perform five specific functions. What are those functions in order, from first to last? Collect the data; present the information to users; store the data; update the data; and process the data into information Present the information to users; update the data; collect the data; process the data into information; and store the data Collect the data; store the data; update the data; process the data into information; and present the information to users Collect the data; process the data into information; update the data; store the data; and present the information to users
It allows a marketer to set prices based on the breakeven point.
Having just opened her antique shop, Nanami is aware that she will most likely have to be price-competitive for her business to survive. Which of the following is incorrect regarding price competition? It allows a marketer to set prices based on the breakeven point. If circumstances force a seller to raise prices, competing firms may be able to maintain their lower prices. It occurs when a seller emphasizes a product's low price and sets a price that equals or beats competitors' prices. The internet has made it more difficult for sellers to compete on the basis of price.
Qualifying
Henry is a used-car salesperson who works for a local dealership. Whenever he interacts with prospective customers, he always asks them if they are interested in buying today, and whether they will be paying in cash or by credit. Questions like this related to which component of personal selling? Order taking Qualifying Public relations Sales promotion
Cash flows from investing activities
Ida is an accountant for a textile manufacturing firm. Recently, the firm purchased (with its own financial assets) ten acres of land for future expansion of its production and operations capabilities. In which section of the firm's statement of cash flows should Ida include this purchase? Cash flows from investing activities Cash flow from financing activities Cash flow from capital activities Cash flows from operating activities
A juris doctor degree
Ida is interested in pursuing a career in finance. Successful managers and employees in finance must have all but which of the following credentials or skills? A strong background in accounting Knowledge of how to use a computer to analyze data A juris doctor degree Be an expert in both written and oral communication
Institutional
In a recently launched advertising campaign called "Decide to Ride," brewer Anheuser-Busch and ridesharing platform Uber have partnered to raise awareness and provide ridesharing opportunities to prevent drunk driving. For Anheuser-Busch and Uber, what kind of advertising is this? Brand Selective-demand Primary-demand Institutional
Dividend distributions
In her Introduction to Business class, Catarina is learning about the four primary sources of funds available to a business. Which of the following is not one of those sources? Debt capital Equity capital Proceeds from the sale of assets Dividend distributions
Inaccurate data can be disastrous to a firm.
In her Introduction to Computers class, Mariana has learned that collecting data is a crucial function for a management information system (MIS) to provide information. Which of the following is correct regarding the "collecting data" function? External sources of data include managers and employees, company records and reports, accounting data, and minutes of meetings. There are two data sources: primary and secondary. Most of the data gathered for an MIS come from external sources. Inaccurate data can be disastrous to a firm.
Information is data presented in a form that is useful for a specific purpose.
In her last Principles of Marketing class, Joana noticed that her professor kept using the terms "data" and "information" interchangeably. Which of the following is correct regarding data and information? Information consists exclusively of numerical or verbal descriptions that usually result from some sort of measurement. They are synonymous concepts. Data are numerical only. Information is data presented in a form that is useful for a specific purpose.
Common stockholders have the first claim (after creditors) on assets if the corporation is dissolved.
In her last lecture class for Introduction to Business, Janice learned about the two types of stock issued by a corporation: common stock and preferred stock. Which of the following is incorrect regarding common stock and preferred stock? A corporation's board of directors must approve dividends on preferred stock. Common stock represents the most basic form of corporate ownership. The owners of preferred stock must receive their dividends before holders of common stock receive theirs. Common stockholders have the first claim (after creditors) on assets if the corporation is dissolved.
It is a summary of a firm's revenues and expenses for an indefinite period.
In his Principles of Accounting class, Professor Julian will lecture to his students today regarding the income statement. Which of the following is incorrect regarding the income statement? It is a summary of a firm's revenues and expenses for an indefinite period. The difference between income and expenses is normally referred to as a cash surplus or a cash deficit for an individual. It is sometimes called the earnings statement. It is sometimes called the statement of income and expenses.
Data processing is the transformation of data into a form that is useful for a general purpose.
In his most recent lecture to his students, Zuwena, a professor of Management Information Systems, emphasized the importance of the data processing function in providing information to an organization. Which of the following is incorrect regarding data processing? Data processing is the transformation of data into a form that is useful for a general purpose. Some data are used in the form in which they are stored. A statistic is a measure that summarizes a particular characteristic of an entire group of numbers. Some data requires processing to extract, highlight, or summarize the information they contain.
Multiple-unit pricing
In need of laundry detergent, Longwei stops at a local Target store to make his purchase. Although he really only needed one container, the detergent is advertised at $15.25 each, or three for $45. Longwei purchases three containers, realizing that he will always need detergent. To which of the following pricing strategies has Longwei been subjected? Multiple-unit pricing Odd-number pricing Penetration pricing Price skimming
Status-quo pricing
In operating his restaurant, Jian is satisfied with both the profit his restaurant earns and its market share. Jian has adopted a pricing strategy that simply matches the competition. Which of the following pricing strategies does Jian utilize? Survival Status-quo pricing Profit maximization Target return on investment
Official stakeholder approval
In preparing for her final examination in Introduction to Business, Margarida came across the concept of the promotional mix in her lecture notes. The makeup of a firm's promotional mix depends on all but which of the following factors? The firm's promotional resources The nature of the target market Official stakeholder approval Product characteristics
Before setting prices for a firm's products, marketers must establish pricing objectives that are aligned with organizational and marketing objectives.
In studying for his Introduction to Business final examination, Njere is reviewing his class notes regarding pricing objectives for a business. Which of the following is correct regarding pricing objectives? A firm's exclusive objective must always be to make a profit. Before setting prices for a firm's products, marketers must establish pricing objectives that are aligned with organizational and marketing objectives. Pricing objectives such as survival, target return on investment, and status-quo pricing may be just as important to a firm as profit generation. After setting prices for a firm's products, marketers must establish pricing objectives that are aligned with marketing objectives.
A public corporation must change its lead auditing firm every seven to ten years, depending on the size of the corporation.
In their Principles of Financial Accounting class, Batini has been studying the Sarbanes-Oxley Act. Which of the following is not a key component of the act? The Securities and Exchange Commission (SEC) is required to establish a full-time, five-member public company accounting oversight board. Accounting firms are prohibited from providing many types of non-audit and consulting services to the companies they audit. A public corporation must change its lead auditing firm every seven to ten years, depending on the size of the corporation. Auditors or accountants must maintain financial documents and audit work papers for usually five to seven years, depending on the type of document.
Collateral
Ishara owns and operates a hardware store. She needs a $20,000 small business loan to purchase additional inventory for the store, and to do that, the local bank requires Ishara to pledge her home as security for the loan. In this transaction, Ishara's home represents which of the following? Collateral A certificate of deposit (CD) A revolving credit agreement A line of credit
Accessory equipment
Ishara, a general partner in a law practice, purchases a photocopier for the firm to use for business purposes. What kind of product is the photocopier? A component part Major equipment Accessory equipment Raw material
Competitors' financial information can be obtained from their annual reports if they are public corporations.
Jin has $75,000 of his "hard-earned" money invested in The Home Depot, Inc. (Home Depot), the largest home improvement retailer in the United States. Julian, who is also a Home Depot employee, likes to compare the financial and accounting information available to him that is generated from both within and outside Home Depot. He likes to compare Home Depot's financial data year-to-year, and he also likes to compare the company's financial data to its competitors' data. Which of the following is incorrect regarding the comparison of financial data? Competitors' financial information can be obtained from their annual reports if they are public corporations. Today, most corporations include in their annual reports comparisons of the important elements of their financial statements for recent years. Comparison of a firm's financial and accounting information is possible if accountants follow generally accepted accounting principles (GAAPs) to prepare the firm's financial statements. Comparison among firms gives employees a general idea of a firm's standing within the industry.
A point of purchase display
Julian is very embarrassed. While in the grocery store, with his head turned back toward the dairy section to remind his spouse to pick up a gallon of milk, Julian tripped over a large cardboard structure in the middle of the aisle with dozens of containers of chocolate syrup carefully arranged on it. The containers scattered all over the aisle, much to Julian's consternation. What type of promotional method is the large cardboard structure holding the containers of chocolate syrup? Cooperative advertising A point of purchase display Inventory management Intensive distribution
An independent retailer
Jun owns and manages an antique shop in downtown Poughkeepsie, New York. She operates her business as a sole proprietorship, has two full-time and three part-time employees, and sells directly and exclusively to customers who purchase for personal use. What type of business owner is Jun? A chain retailer An independent retailer A discount store owner A department store owner
"Free on board destination," the price includes freight charges, and thus the seller pays freight charges.
Karolina, the owner of a consumer electronics retail store in Little Rock, Arkansas, purchases 25 televisions from an electronics wholesaler in Chicago, Illinois. The purchase order indicates "FOB destination" pricing. What does this pricing term mean? "Frequently occurring business at the point of destination," the price does not include freight charges, and thus the buyer pays freight charges. "Free on board destination," the price does not include freight charges, and thus the buyer pays freight charges. "Free on board destination," the price includes freight charges, and thus the seller pays freight charges. "Frequently occurring business at the point of destination," the price includes freight charges, and thus the seller pays freight charges.
A debenture bond
Kemi is the principal owner of a home and office cleaning corporation. To obtain necessary operational capital, the company has issued a bond to investors backed only by its reputation. Which of the following did Kemi's corporation issue? A mortgage bond A convertible bond A term-loan agreement A debenture bond
He needs to have detailed information about his firm's products and services and those offered by competitors.
Kesse is a marketing manager for an air conditioning, heating, and refrigeration company. Which of the following is correct regarding the informational requirements for his position? He must be aware of anything that pertains to his firm's employees. He is concerned with present and future sales levels, current inventory levels of resources, work in process, finished goods, and the availability and cost of the resources required to produce goods and services. He must ensure that the company's managers and employees, lenders and suppliers, stockholders and potential investors, and government agencies have the information they need to measure the financial health of the company. He needs to have detailed information about his firm's products and services and those offered by competitors.
Distribution channel
Koki owns and operates a small textile manufacturing business in Suwanee, Georgia. Her company exclusively manufactures socks. Koki sells the socks she produces to a wholesaler, who in turn sells them to retailers. The retailers then sell the socks to consumers. Which of the following refers to this sequence of marketing organizations that directs the socks from the producer to the ultimate user? Exclusive distribution Direct selling Distribution channel Intensive distribution
Providing a sales force
Krisha owns a wholesale appliance business. Lately, several of Krisha's retail clients have threatened to eliminate her company from their supply chain, questioning whether wholesalers add real value to the product distribution process. Krisha plans to meet with each of her retail clients to justify her company's continued involvement in their supply chain. Wholesalers help retailers in all but which of the following ways? Stocking in one place the variety of goods that retailers otherwise would have to buy from many producers Providing assistance to retailers in promotion, market information, and financial aid Buying in large quantities and selling to retailers in smaller quantities Providing a sales force
Growth
Laclan has operated a banjo shop in Sevierville, Tennessee for the past three years. Laclan sells only the banjos that he, his brother, and his son produce. Although sales were modest in the first two years, sales of his family-made banjos have increased so dramatically in the past year that it is difficult for him to keep inventory on the store's shelves. Many customers have paid deposits on the banjos, and Laclan is concerned that they may have to wait over one year before they receive their orders. At what stage of the product life cycle are Laclan's family-crafted banjos? Maturity Growth Introduction Decline
Despite a groundswell of support at the "grass-roots" level, the U.S. Congress has yet to implement a national do-not-call registry.
Lakshmi has worked as a telemarketer for the past six months. She finds the work highly stressful and unrewarding, primarily because her pay is low, and customers are frequently rude to her. Which of the following is not true regarding telemarketing? Telemarketing has many business advantages. The Federal Communications Commission (FCC) outlaws "robocalls" from companies for marketing purposes. Increasingly restrictive telemarketing laws have made it a less appealing marketing method. Despite a groundswell of support at the "grass-roots" level, the U.S. Congress has yet to implement a national do-not-call registry.
An automated clearinghouse (ACH) network
Laqueta works as a certified public accountant (CPA) for a large accounting firm. The firm uses a network that transfers salaries directly into their employee's bank accounts, thus eliminating the need to make out individual paychecks. The accounting firm Laqueta works for uses which of the following for employee salary transfers? A point-of-sale terminal Electronic check conversion An automatic teller machine (ATM) An automated clearinghouse (ACH) network
Equity capital
Luiz and Naroa have decided to form a law partnership. To get their practice started, Luiz and Naroa have agreed to provide $25,000 each from their personal funds. These contributions from Luiz and Naroa to their partnership represent which of the following? Proceeds from the sale of assets Equity capital Sales revenues Debt capital
An initial public offering
Maria is the principal owner of an information technology firm in Carrollton, Texas. After having operated the business successfully for the last ten years, Maria and her co-owners are considering "taking the next step" in growing the business by selling common stock to the general public for the first time. This initiative is known as which of the following? Retained earnings An initial public offering Over-the-counter marketing A securities exchange
A missionary salesperson
Marlon is a salesperson for a farm equipment manufacturer. Marlon's primary responsibilities include making "cold calls" (i.e., unannounced visits) to farm supply retailers to encourage them to carry his company's products. What kind of salesperson is Marlon? Institutional promoter A trade salesperson A missionary salesperson An inside order taker
Zero-base budgeting
Marlon operates a textile manufacturing business in Birmingham, Alabama. Due to the highly competitive nature of the industry both domestically and internationally, Marlon micromanages every penny of his company's expenses. He specifically requires that every expense in his company's budget must be justified. Marlon's approach to budgeting is known as which of the following? Capital budgeting Zero-base budgeting Equity capitalization Debt capitalization
"Free on board at the point of origin," which means that the price does not include freight charges.
Marlon, the owner of a furniture retail store in Carrollton, Texas, purchases a truckload of furniture items from a furniture manufacturer in Lexington, North Carolina. The purchase order indicates "FOB origin" pricing. What does this pricing term mean? "Frequently occurring business at the point of origin," which means that the price includes freight charges. "Free on board at the point of origin," which means that the price includes freight charges. "Frequently occurring business at the point of origin," which means that the price does not include freight charges. "Free on board at the point of origin," which means that the price does not include freight charges.
$60,825
Miguel, the manager of a clothing retail store, is calculating his store's cost of goods sold for a particular time period. Beginning inventory amounted to $38,041, net purchases totaled $43,232, and ending inventory was $20,448. What was the cost of goods sold? $60,825 $101,721 $25,639 $15,257
Marketing intermediary
Nianzu owns and operates a wholesale electronics business. His company purchases electronics products from producers in China and then sells those products to retailers in the United States and Europe. Which of the following refers to the nature of Nianzu's business? Exclusive distribution Intensive distribution Marketing intermediary Direct selling
A convenience product
Noticing that her car is "running on empty," Alessia stops at a local gas station to fill up. After doing so, Alessia goes into the store to purchase a soft drink. What kind of product is the soft drink? A convenience product A specialty product An unsought product A shopping product
Publicity
Nuwa is about to realize her entrepreneurial dream in opening a small cosmetics shop in downtown South Bend, Indiana. At the grand opening, Nuwa plans to invite local media, offer free facials to customers, and have a "ribbon-cutting" ceremony. Nuwa hopes that local media will print several stories covering the grand opening, her cosmetics store, and her products, since the "reach" of the articles will go far beyond the few dozen people who are anticipated to attend the event. If the media does print stories covering the grand opening, that would represent which of the following? Cooperative advertising Intensive distribution Integrated marketing communications Publicity
A producer brand
Originally introduced as Washburn's Gold Medal Whole Wheat Flakes in 1924, Wheaties is a brand of breakfast cereal made by General Mills, Inc. The company owns the brand name "Wheaties." Which of the following is this brand name? A producer brand A store brand A private brand A generic brand
Specialty wholesaler
Prisha is a "rack jobber." She owns and stocks display racks in supermarkets, drugstores, and discount and variety stores. Which of the following best describes the nature of Prisha's business? A multichannel retailer Specialty wholesaler General-merchandise wholesaler Limited-line wholesaler
Decline
Publishers confirm that the printed dictionary market is disappearing. Sales of printed dictionaries have decreased sharply in recent years, as have industry profits. This is obviously due to ease of looking up word definitions on the internet. At what stage of its product life cycle is the printed dictionary? Growth Introduction Decline Maturity
Cash flows from financing activities
Ren is an accountant for an engineering firm. Due to a recent downturn in the economy, the firm recently borrowed $100,000 to meet the employee payroll. Where in his firm's statement of cash flows should Ren include this change in the firm's debt obligation? Cash flows from operating activities Cash flows from investing activities Cash flows from capital activities Cash flows from financing activities
Trade credit
Riko owns and operates a furniture wholesaling business. To facilitate sales to retailers, Riko often provides financial assistance to his retail customers by allowing them up to 60 days to pay for the furniture they purchase. Which of the following describes the arrangement Riko has with his customers? Zero-based budgeting Long-term financing Speculative production Trade credit
Speculative production
Rin owns and operates a residential kitchen cabinet manufacturing company. Based on previous experience, Rin knows that although she will have a production run of cabinets in January, those cabinets may not sell until April, when the weather for home construction improves. This time lag between Rin's actual production of cabinetry in January and when it is sold in April is which of the following? Short-term financing Speculative production Long-term financing Cash flow
A promissory note
Rishaan, who owns a wholesale supply business, has just sold $8,200 in merchandise to Clara for inventory in her styling salon. In return, Clara has signed a pledge to Rishaan to pay the $8,200, plus a designated rate of interest, one year from the date of the sale. Which of the following represents the arrangement between Clara and Rishaan? A revolving credit agreement Zero-base budgeting A line of credit A promissory note
Odd-number pricing
Shun needs to purchase a preowned car. He visits a local car dealership and sees a car he likes priced at $34,999.99. Shun feels that it is very strange to price the car at 1 cent less than $35,000; after all, what difference does a penny make when spending tens of thousands of dollars? What pricing strategy is the seller using in this situation? Negotiated pricing Price skimming Reference pricing Odd-number pricing
This method results in a higher price when product demand is strong.
Suppose that a sports ticket-brokering company is considering using demand-based pricing as its pricing strategy. Which of the following is correct regarding demand-based pricing? To use this method, a marketer estimates the amount of a product that competing businesses will supply at different prices and then chooses the price that should generate the highest total revenue. The effectiveness of this method depends on a firm's ability to estimate supply accurately. This method results in a higher price when product demand is strong. A company may favor a demand-based pricing method called price differentiation if it wants to use one price in the marketing of a specific product.
A premium
Suppose that the Proctor & Gamble Company, manufacturers of Crest brand toothpaste, runs a promotional campaign that offers a small, travel-sized tube of toothpaste for customers who purchase a regular-sized tube. The travel-sized tube of toothpaste comes at no extra charge, and is attached via packaging to the regular-sized tube. What type of sales promotion is this? A buying allowance A rebate A frequent-user incentive A premium
As an industry standard, banks ordinarily charge three times the interest rate for short-term loans compared to long-term loans.
Tereza is interested in obtaining short-term financing for her confectionary shop, primarily because she has heard from fellow entrepreneurs that short-term financing is usually easier to obtain than long-term debt financing. Which of the following is not a reason short-term debt financing is usually easier to obtain than long-term debt financing? For the lender, the shorter repayment period means less risk of nonpayment. The dollar amounts of short-term loans are usually smaller than those of long-term loans. A close working relationship normally exists between the short-term borrower and the lender. As an industry standard, banks ordinarily charge three times the interest rate for short-term loans compared to long-term loans.
Its product mix
The Home Depot, Inc. is the largest home improvement retailer in the United States. It sells a wide assortment of products, ranging from washing machines and dryers to shovels and rakes. The assortment of products that The Home Depot, Inc. offers to consumers and businesses is known as which of the following? Its major equipment Its convenience products Its product line Its product mix
A term-loan agreement
To obtain much-needed operational capital for her restaurant, Chiku recently signed a promissory note to repay a $10,000 loan from her lender in monthly installments over three years. Which of the following refers to the arrangement Chiku has with her lender? A corporate bond A debenture bond A registered bond A term-loan agreement
It is also known as non-physical distribution.
United Parcel Service, Inc. (UPS) is the world's largest package delivery company and a leading global provider of specialized transportation and logistics services. Which of the following is not true regarding logistics? It combines several interrelated business functions, including inventory management, order processing, warehousing, materials handling, and transportation. It includes all those activities concerned with the efficient flow and storage and storage of products from the producer to the ultimate user. It is also known as non-physical distribution. Marketers view logistics as an integrated effort that supports other marketing activities.
Pricing allocates goods and services in an optimal way that ensures equitable outcomes for all involved in the sales transaction.
Vanya just purchased a new Ford Bronco sport utility vehicle for $49,975. Vanya is pleased with her purchase (she is a huge "off-road" enthusiast), but she is not very happy about the monthly payments she will be making for the Bronco. Which of the following is incorrect regarding the allocation function of pricing? Pricing allocates goods and services among those who are willing and able to buy them. Pricing allocates financial resources among producers according to how well they satisfy customers' needs. Pricing allocates goods and services in an optimal way that ensures equitable outcomes for all involved in the sales transaction. Pricing helps customers allocate their own financial resources among various want-satisfying products.
Public relations helps a company to remain insular.
Vanya, a recent college graduate, has recently accepted an entry-level position in the Walmart public relations department. She will report for work on Monday morning at the company's corporate headquarters in Bentonville, Arkansas. Which of the following is not true regarding public relations? Public relations helps a company to remain insular. It can be used to promote people, places, activities, and ideas. Effective management of public-relations efforts can reduce the amount of unfavorable coverage surrounding negative events. It focuses on enhancing the reputation of the total organization.
