Test #1: Chapter #2
Which of the following is not one of the four business processes? a.) performance measurement and management process b.) capital resource process c.) internal control process d.) business organization and strategy process
internal control process
Identify the item below that is considered non-value added time (when goods are non-actively being worked on): a.) time it takes for customer to order goods b.) time it takes to process an order c.) time it takes to ship the order d.) all of the above are non-value added time
all of the above are non-value added time
When a company operates in a more certain environment it tends to focus inward and have a: a.) flexible strategy b.) rigid strategy c.) loose strategy d.) efficiency strategy
efficiency strategy
Activities involving obtaining necessary funds to purchase long-term assets, repay existing obligations, and provide a return for owners are referred to as: a.) financing activities b.) operating activities c.) investing activities d.) planning activities
financing activities
Riga Corp borrowed $1,000,000 to buy a new manufacturing plant is part of their: a.) operating activities b.) financing activities c.) investing activities d.) planning activities
financing activities
The Capital Resources Process features which of the following pairs of activities? a.) operating and investing b.) financing and investing c.) reporting and operating d.) financing and planning
financing and investing
Activities involving the purchase and sale of long-term assets as well as other major items used in a business's operation are referred to as: a.) operating activities b.) investing activities c.) financing activities d.) planning activities
investing activities
Morland Corp purchased a building that will house its new manufacturing plant. This is part of Morland's: a.) operating activities b.) investing activities c.) financing activities d.) planning activities
investing activities
Which one of the following processes is responsible for purchase and sale of long-term investments? a.) capital resource process b.) operating process c.) investing process d.) business organization and strategy process
investing process
The cost and effectiveness of research and development is part of which of the following balanced scorecard perspectives? a.) financial perspective b.) learning and growth perspective c.) customer perspective d.) internal perspective
learning and growth perspective
All the checks used by Graphics, Inc. to pay its bills are prenumbered. This is an application of which of the following internal controls: a.) maintaining adequate documents and records b.) physically controlling assets and documents c.) requiring proper authorization d.) separating incompatible duties
maintaining adequate documents and records
Which of the following bank reconciliation items would require the case on the company's books to be reduced? a.) outstanding check b.) deposit in transit c.) non-sufficient funds check d.) bank error
non-sufficient funds check
The profit making activities of an enterprise are referred to as: a.) financing activities b.) planning activities c.) operating activies d.) investing activities
operating activities
When a company operates in an uncertain environment that has rapidly changing products, it is more likely to have a(n): a.) mechanistic organizational structure with an efficiency strategy b.) organic structure with a flexible strategy c.) holistic organizational structure with an organic strategy d.) synthetic organizational structure with a decentralized strategy
organic organizational structure with a flexible strategy
On a bank reconciliation, which of the following will reduce the bank's cash balance? a.) outstanding check b.) deposit in transit c.) non-sufficient funds check d.) failure of the company to record the correct amount of the check on the company's records
outstanding check
Which of the following is not considered a subprocess of the Operating Process? a.) conversion b.) performance c.) marketing/sales/collection/customer service d.) purchasing/human resources/payment
performance
The Balanced Scorecard Approach is part of which of the following processes? a.) operating process b.) capital resources process c.) performance measurement and management process d.) business organization and strategy process
performance measurement and management process (balanced scorecard approach: performance metric used in strategic management to identify and improve various internal functions of a business and their resulting external outcomes)
A burger shop requires employees to ring up sales and place all cash receipts in the cash register. This is an application of which of the following internal controls: a.) requiring proper authorization b.) separating incompatible duties c.) physically controlling assets and documents d.) maintaining adequate documents and records
physically controlling assets and documents
Which of the following is considered value added time (processes that improve products)? a.) order response time b.) production time c.) queue time d.) shipping time
production time
Which of the following measure the liquidity of a company? a.) return on owners' equity b.) gross margin ratio c.) return on investment d.) quick ratio
quick ratio
Which of the following ratios measures the profitability of the money invested in the firms' assets? a.) quick ratio b.) return on owners' equity c.) gross margin ratio d.) return on investment
return on investment
The bookkeeper who records cash receipts also deposits daily cash receipts at the bank on his way home from work. This is a violation of which of the following characteristics of good internal control: a.) requiring proper authorization b.) maintaining adequate documents and records c.) physically controlling assets and documents d.) separating incompatible duties
separating incompatible duties