56.On a worksheet, the adjusted balance of the Supplies Expense account is extended to:    A. the Income Statement Debit column.   B. the Income Statement Credit column.   C. the Balance Sheet Debit column.   D. the Balance Sheet Credit column.         57.Which of the following statements is correct?    A. The cost of supplies used is reported on the statement of owner’s equity.   B. The […]

  73. Another name for a temporary account is a(n):  A. Real account. B. Contra account. C. Accrued account. D. Balance column account. E. Nominal account. 74. Which of the following accounts are permanent (real) accounts?  A. Fees earned. B. Office supplies expense. C. Interest revenue. D.Accounts payable. E.Salaries expense. 75. When closing entries are made:  A. All ledger accounts are closed to start the new accounting period. B. All temporary accounts are closed […]

  7) Eliminating non-value added activities by reducing their cost drivers, is referred to as A) value-added pricing. B) value-added activity base pricing. C) cost incurrence costing. D) price engineering. E) value engineering.   8) When are a product’s direct materials cost most likely to be locked in? A) when the product is designed B) when purchasing commits to buying the materials C) when the […]

    71. Which of the following is the most serious limitation of internal controls?  A. Computer error B. Human fraud or human error C. Cost-benefit principle D. Cybercrime E. Management fraud     72. Which of the following are risks of e-commerce?  A. Firewalls, fraud, and computer viruses. B. Encryption, stolen credit card numbers, and fraud. C. Stolen credit card numbers, computer viruses, and impersonation. D. Computer viruses, encryption, and stolen credit card numbers. E. Impersonation, […]

  21. Large, highly-rated firms sometimes sell commercial paper  A. To borrow funds at a lower rate than through a bank. B. To borrow funds when they cannot obtain a loan from a bank. C. Because they can’t borrow anywhere else. D. To improve their credit rating. 22. Which of the following is not an employer payroll cost?  A. FICA taxes. B. Federal and state unemployment taxes. C. Federal and state income taxes. D. Employer […]

  46) Purchases budgeted for February total: A) $69,120 B) $60,480 C) $115,200 D) $64,800 47) Shamokin Manufacturing produces two products, Big and Bigger. Shamokin expects to sell 10,000 units of product Bigger and to have an inventory of 2,000 units of Bigger on hand at the end of the period. Currently, Shamokin has 800 units of Bigger on hand. Bigger requires two labor operations, […]

    41. Which of the following best describes the term “retained earnings” of a company?  A. The amount of total profits earned by a company since it began operations. B. The amount of claim that the owners have on the assets of the company. C. The future economic resources of a company. D. The accumulated net income of a company that has not been distributed to owners in the […]

  11) One possible reason for unfavorable variable overhead efficiency variance for materials handling is ________. A) inefficient layout of product distribution channels B) loosely budgeted standard hours C) very low wait time at work centers D) experienced but unmotivated employees   12) The fixed setup overhead flexible-budget variance is calculated as actual costs – flexible-budget variance.   13) An unfavorable price variance for materials-handling […]

  Learning Objective 9-7   1) Negative cash flow from investing activities on the statement of cash flows means that a company has ________. A) paid a large cash dividend to shareholders B) paid more for operating expenses than it collected from customers C) sold additional shares of common stock D) bought additional property, plant and equipment   2) Positive cash flow from investing activities […]

  7) The practical capacity method of allocating costs is: A) based on the budgeted capacity demanded. B) based on actual capacity used. C) based on the practical capacity supplied. D) based on the using departments negotiating the charges they will accept.   8) When budgeted cost-allocation rates are used, user-division managers face uncertainty about the allocation rates for that budget period.   9) When […]