91. The management of Nebraska Corporation is considering the purchase of a new machine costing $490,000. The company’s desired rate of return is 10%. The present value factors for $1 at compound interest of 10% for 1 through 5 years are 0.909, 0.826, 0.751, 0.683, and 0.621, respectively. In addition to the foregoing information, use the following data in determining the acceptability in this […]
44. Lucy Treasures operates a chain of gift shops. The company pays $5,000 of rent expense per month for each shop. The managers of each shop are paid a salary of $3,000 per month and all other employees are paid on an hourly basis. Relative to the number of shops, the cost of rent is which kind of cost? A. Fixed cost B. Variable cost C. Mixed cost […]
21) Which of the following statements is true of electronically stored information? A) Deleting electronically stored information destroys it, just like burning or shredding a paper document would. B) The volume of electronically stored information is usually much lesser than paper information but it is difficult to see how communication records quickly accumulate compared to paper information. C) Unlike paper information, electronically stored information […]
Multiple Choice Questions 23.A responsibility accounting system measures the performance of each of the following centers except: A. Profit center. B. Investment center. C. Control center. D. Cost center. 24.The part of a business a particular manager is held responsible for is called a: A. Cost center. B. Profit center. C. Investment center. D. Responsibility center. 25.An example […]
146. Project A requires an original investment of $65,000. The project will yield cash flows of $15,000 per year for seven years. Project B has a calculated net present value of $5,500 over a five year life. Project A could be sold at the end of five years for a price of $30,000. (a) Using the proper table below determine the net present value of […]
Multiple Choice Questions 133. Beck Corporation declared a 2-for-1 common stock split, but this transaction was erroneously recorded as a 100% common stock dividend. As a result: A. The common stock account is overstated. B. The total dollar amount of stockholders’ equity is overstated. C. The corporate records do not show the correct number of shares of common stock outstanding. D. The par value per share is […]
72.Job A3B was ordered by a customer on September 25. During the month of September, Jaycee Corporation requisitioned $2,500 of direct materials and used $4,000 of direct labor. The job was not finished by the end of the month, but needed an additional $3,000 of direct materials in October and additional direct labor of $6,500 to finish the job. The company applies overhead at […]
133.The accounting principle that requires revenue to be recorded when earned is the: A.Matching principle. Revenue recognition principle. C.Time period assumption. D.Accrual reporting principle. E.Going-concern assumption. 134.Adjusting entries: A.Affect only income statement accounts. B.Affect only balance sheet accounts. Affect both income statement and balance sheet accounts. D.Affect cash accounts. E.Affect only […]
11) A machine shop has direct materials cost of $1,800,000 direct labour of $4,200,000 (direct labour rate is $50 per hour) and budgeted indirect manufacturing costs of $850,000. Management believes that indirect manufacturing costs increase with direct labour hours. What is the budgeted indirect manufacturing cost rate? A) $2.12 B) $2.33 C) $4.94 D) $10.12 E) $17.00 12) A local financial consulting firm employs […]
41) Wilson’s Winter Woolens manufactures jackets and other wool clothing. A certain designed ski parka requires the following: Direct materials standard2 square yards at $13.50 per yard Direct manufacturing labor standard1.5 hours at $20.00 per hour During the third quarter, the company made 1,500 parkas and used 3,150 square yards of fabric costing $39,375. Direct labor totaled 2,100 hours for $45,150. […]
71.SupposethatanAmericanopensandoperatesacandyfactoryinFinland.Thisisanexampleof
a.foreigndirectinvestment.AmericansavingisusedtofinanceFinishinvestment.
b.foreigndirectinvestment.AmericansavingisusedtofinanceAmericaninvestment.
c.foreignportfolioinvestment.AmericansavingisusedtofinanceFinishinvestment.
d.foreignportfolioinvestment.AmericansavingisusedtofinanceAmericaninvestment.
72.SupposethatanAmericancompanyopensandoperatesarestaurantinIreland.Thisisanexampleof
a.foreigndirectinvestment.AmericansavingisusedtofinanceIrishinvestment.
b.foreigndirectinvestment.AmericansavingisusedtofinanceAmericaninvestment.
c.foreignportfolioinvestment.AmericansavingisusedtofinanceIrishinvestment.
d.foreignportfolioinvestment.AmericansavingisusedtofinanceAmericaninvestment.
73.Foreignsavingisusedfordomesticinvestmentwhenforeignersengagein
a.foreigndirectinvestment.
b.foreignportfolioinvestment.
c.eitherforeigndirectinvestmentorforeignportfolioinvestment.
d.Noneoftheaboveiscorrect.
74.IfWarmWear,aU.S.manufacturerofwinterclothing,opensanewfactoryinAustria,then
a.AustrianGNPincreasesbymorethanAustrianGDP,becauseGDPincludesincomeearnedbyforeignersworkinginAustria.
b.AustrianGNPincreasesbymorethanAustrianGDP,becauseGDPexcludesincomeearnedbyforeignersworkinginAustria.
c.AustrianGNPincreasesbylessthanAustrianGDP,becauseGDPincludesincomeearnedbyforeignersworkinginAustria.
d.AustrianGNPincreasesbylessthanAustrianGDP,becauseGDPexcludesincomeearnedbyforeignersworkinginAustria.
75.SupposeaU.S.automakerbuildsandoperatesanewfactoryinItaly.Futureproductionfromsuchaninvestmentwill
a.increaseItalianGDPmorethanitincreasesItalianGNP.
b.increaseItalianGNPmorethanitincreasesItalianGDP.
c.havenoaffectonItalianGNP,butwillincreaseItalianGDP.
d.havenoaffectoneitherItalianGDPorGNP.
76.SupposeJapanese-basedToshibaCorporationbuildsandoperatesanewcomputerfactoryintheUnitedStates.
a.increaseU.S.GNPmorethanitincreasesU.S.GDP.
b.increaseU.S.GDPmorethanitincreasesU.S.GNP.
c.havenoaffectonU.S.GNP,butwillincreaseU.S.GDP.
d.havenoaffectonU.S.GNPorGDP.
77.TheopeningofanewAmerican-ownedfactoryinAlgeriawouldtendtoincreaseAlgeria'sGDPmorethanitincreasesAlgeria'sGNPbecause
a.someoftheincomefromthefactoryaccruestopeoplewhodonotliveinAlgeria.
b.grossdomesticproductisincomeearnedwithinacountrybybothresidentsandnonresidents,whereasgrossnationalproductistheincomeearnedbyresidentsofacountrywhileproducingbothathomeandabroad.
c.alloftheincomefromthefactoryisincludedinAlgeria'sGDP.
d.Alloftheabovearecorrect.
78.IfaJapanesecompanyopensanewfactoryinSouthKorea,itmakes
a.foreigndirectinvestment.ThefactorywillmakeabiggerimpactonSouthKorea’sGDPthanonitsGNP.
b.foreigndirectinvestment.ThefactorywillmakeabiggerimpactonSouthKorea’sGNPthanonitsGDP.
c.foreignportfolioinvestment.ThefactorywillmakeabiggerimpactonSouthKorea’sGDPthanonitsGNP.
d.foreignportfolioinvestment.ThefactorywillmakeabiggerimpactonSouthKorea’sGNPthanonitsGDP.
79.WhenChileexperiencesinvestmentfromabroad,itexperiences,asaresult,
a.anincreaseinproductivity.
b.adecreaseinGrossNationalProduct(GNP).
c.lowerwagesforChileanworkers.
d.Noneoftheaboveiscorrect.
80.IfcompaniesfromforeigncountriesbuildandoperatefactoriesinChina,thenChina’sproductivity
a.andthewagesofChineseworkersincrease.
b.increasesbutthewagesofChineseworkersdecrease.
c.decreasesbutthewagesofChineseworkersincrease.
d.andthewagesofChineseworkersdecrease.
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