11.6   Learning Objective 11-6 1) It is management’s responsibility to issue a report on internal control. 2) Publicly traded companies have the option to produce audited financial statements. 3) Publicly traded companies have to file their financial statements with the IRS. 4) An audit report is addressed to the board of directors and stockholders of the company. 5) It is NOT the independent auditor’s […]

    11) Multicollinearity exists in multiple regression when two or more independent variables are highly correlated with each other. 12) The t-value of a coefficient measures how large the value of the estimated coefficient is relative to its standard error.   13) The standard error of the estimated coefficient indicates how much the estimated value, b, is likely to be affected by random factors. […]

  165. ABC Printing Company uses a job order cost system.  (a) Indicate the source of the data for debiting Work in Process for each of the following:   (1) Direct materials requisitioned   (2) Direct labor used     (b) Indicate the source of the data for crediting Work in Process for jobs completed.     (c) Present a list of the three controlling accounts […]

  94.To compute trend percentages the analyst should:    A. Select a base period, assign each item in the base period statement a weight of 100%, and then express financial numbers from other periods as a percent of their base period number. B. Subtract the analysis period number from the base period number. C. Subtract the base period amount from the analysis period amount, divide the result by the […]

      183.An employer has an employee benefit package that includes employer-paid health insurance and an employer-paid retirement program. During March, the employer paid $5,500 for health insurance, and contributed to the employee retirement program 10% of the employees’ $120,000 gross salaries. Prepare the journal entry to record these employee benefits.             184.A company sells its product subject to a […]

  172.Based on the following income statement and balance sheet for Bankowski Corporation, determine the cash flows from operating activities using the indirect method.  Bankowski CorporationIncome StatementFor Year Ended December 31, 2015 Sales $504,000 Cost of goods sold $327,600 Depreciation expense33,000 Other operating expenses  125,500(486,100) Other gains (losses): Gain on sale of equipment      5,200 Income before taxes $23,100 Income tax expense    (4,800) Net income $18,300   Bankowski CorporationBalance SheetsAt December 31 20152014 […]

  5) An advantage of using budgeted costs for transfer pricing among divisions is that: A) overall corporate profitability is usually higher B) it usually provides a basis for optimal decision making C) the divisions know the transfer price in advance D) it promotes subunit autonomy   6) The transfer-pricing method that reduces the goal-congruence problems associated with a pure cost-plus-based transfer-pricing method is: A) […]

  Table 10-1   On January 1, 2013, Bark Manufacturing Company Ltd. purchased a machine for $27,500, and expects to use the machine a total of 32,000 hours over the next four years. Bark set the residual value on the machine at $3,500. Bark used the machine 6,000 hours in 2013 and 7,200 hours in 2014.   21) Referring to Table 10-1, what is the […]

  7) ________ would be a consideration in a make-or-buy decision. A) Excess capacity B) Rental income from unused facilities C) Variable factory overhead D) All of the above are correct.   8) If a company has excess capacity, the most it would pay for buying a product that it currently makes would be the: A) total variable cost of producing the product B) market […]

1. Which of the following is an internal event?  A. Caddie salaries are paid by a country club. B. Dividends are distributed to a company’s stockholders. C. Potatoes used in a fast-food restaurant are purchased. D. Products are transferred from the assembly area to the painting station.   2. Which of the following is not an external event?  A. A grocery store recognizes losses from spoilage. B. A grocery store runs ads in […]