Chpt 8 and 9 Accounting

Managers should consider which of the following when deciding whether to outsource a product or service?

All of the above (cost charged for the product or service, quality of the product or service, delivery schedule of the product or service)

Which of the following best describes "target costing"?

An approach to pricing that begins with revenue at market price and subtracts desired profit to arrive at target total cost

Budgeting process

Budgeting provides feedback to management to aid in assessing how well it's reaching its goals, budgets force managers to plan for the future, budgets force managers to consider relations among operations across the entire value chain

Which would be a consideration for making special orders?

all of the above (if price will cover incremental costs of filling the order, available capacity to fill the order, if the order will affect regular sales in the long run)

Which of the following would be a consideration for "sell as is or process further" decisions?

all of the above (costs involved in further processing, revenue generated if sold "as is," revenue generated if "further processed"

A company's manager would consider which of the following in deciding whether to discontinue its electronics product line?

all of the above (how discontinuing the electronics product line would affect sales of its other products (like CDs), the revenues it would lose from discontinuing the product line, the costs it could save by discontinuing the product line)

Which of the following components is a part of the financial budget?

budgeted balance sheet

The ___ budget is a component in a financial budget?

cash

Fixed costs that are allocated among all departments are known as

common fixed costs

The factor that restricts production or sale of a product is which of the following?

constraint

The contribution margin per unit of constraint is calculated as

contribution margin per unit x unit per constraint

Which of the following best describes a "sunk cost"?

costs that were incurred in the past and cannot be changed

All of the following are functions of the budget committee except

determine the bonuses the organization awards to employees that achieve the target budget

A "relevant cost" is best described by which of the following?

expected future costs that differ among alternatives

Which of the following budgets is the comprehensive planning document for the entire organization?

master budget

Which type of budgeting involves the participation of many levels of management?

participative budgeting

Which of the following budgets would NOT be prepared by a service company?

production budget

Which of the following would appear on both the budgeted income statement and the cash budget?

rent expense

Usually, the first step in the budgetary process is the preparation of the:

sales budget

Which of the following is NOT true of the budgeting process?

the performance report is prepared as part of the master budget.

A "sales mix" is best described by which of the following?

the relative number of all products to be sold

Which of the following describes the products and services of companies that are price-setters?

they tend to be unique.

the production for the month for a manufacturing firm is determined by:

units sold minus desired beginning inventory plus desired ending inventory

The quantity of direct materials purchases calculation is?

units to be produced times raw materials per unit plus ending inventory minus beginning inventory

Which of the following is an advantage of zero-based budgeting?

zero-based budgeting forces managers to justify each dollar in the budget to ensure that some expenses are lower in a current year compared to what they were in previous years.