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| 1 | |
Which of the following responsibility centers have managers who are held accountable for costs? |
| | A) | Cost centers and Profit centers. |
| | B) | Revenue centers and Profit centers. |
| | C) | Revenue centers and Investment centers. |
| | D) | Investment centers |
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| 2 | |
In which type of responsibility center is the manager held accountable for its profits? |
| | A) | Profit center |
| | B) | Revenue center |
| | C) | Investment center |
| | D) | Profit centers or Investment centers |
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| 3 | |
A performance report can be used for which of the following? |
| | A) | Reporting actual and budgeted cost differences for a single subunit |
| | B) | Reporting actual and budgeted costs differences for several subunits |
| | C) | Reporting actual and budgeted cost differences between cost centers |
| | D) | All of the above |
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| 4 | |
Which of the following statements is false? |
| | A) | A collection of costs to be assigned is called a cost pool. |
| | B) | Responsibility centers, products, and services are called cost objects. |
| | C) | Marketing costs allocation should be based on actual revenues. |
| | D) | An allocation base may be referred to as a cost driver. |
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| 5 | |
Which of the following is a collection of costs to be assigned to a set of cost objects? |
| | A) | A cost pool. |
| | B) | An allocation base. |
| | C) | A cost-object collection. |
| | D) | Either A or C. |
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| 6 | |
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The total of the teacher enhancement cost pool is $520,000. What amount of the cost pool should be allocated to the teacher evaluation responsibility center? |
| | A) | $65,000 |
| | B) | $104,000 |
| | C) | $13,000 |
| | D) | $195,000 |
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| 7 | |
Which of the following is the proper focus of a responsibility-accounting system? |
| | A) | To determine who is responsible for unfavorable variances |
| | B) | To determine who is in the best position to explain variances |
| | C) | The presentation of useful information |
| | D) | Both (B) and (C) |
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| 8 | |
The behavioral effects of responsibility-accounting systems: |
| | A) | can be significant. |
| | B) | can encourage cost/benefit analyses among managers. |
| | C) | can motivate desirable actions by upper-level management. |
| | D) | can do all of the above. |
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| 9 | |
Which of the following statements is true? |
| | A) | Traditional responsibility-accounting systems tend to focus on financial performance measures. |
| | B) | Contemporary cost management systems are beginning to focus more and more on activities. |
| | C) | The data base created by an activity-based costing (ABC) system enables management to employ activity-responsibility accounting. |
| | D) | All of the statements are true. |
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| 10 | |
Segment A generated sales revenues of $400,000 and variable operating expenses of $180,000. Its controllable fixed expenses were $40,000. It was assigned 20% of $200,000 of fixed costs controlled by others. The common fixed costs were $25,000. What was the Segment A's contribution margin? |
| | A) | 55% of its revenue |
| | B) | $180,000 |
| | C) | $155,000 |
| | D) | $140,000 |
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| 11 | |
Segment A generated sales revenues of $400,000 and variable operating expenses of $180,000. Its controllable fixed expenses were $40,000. It was assigned 20% of $200,000 of fixed expenses traceable to Segment A but controlled by others. The common fixed costs were $25,000. What was Segment A's controllable segment profit margin? |
| | A) | $220,000 |
| | B) | $180,000 |
| | C) | $155,000 |
| | D) | $140,000 |
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| 12 | |
Segment A generated sales revenues of $400,000 and variable operating expenses of $180,000. Its controllable fixed expenses were $40,000. It was assigned 20% of $200,000 of fixed expenses traceable to Segment A but controlled by others. The common fixed costs were $25,000. What was the Segment A's segment profit margin? |
| | A) | $220,000 |
| | B) | $180,000 |
| | C) | $155,000 |
| | D) | $140,000 |
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| 13 | |
Which of the following is a key feature or characteristic of segmented reporting? |
| | A) | Segmented income statements use a contribution format |
| | B) | Segmented income statements highlight controllable and uncontrollable expenses |
| | C) | Segmented income statements show the income statement for the company as a whole and for its major segments. |
| | D) | All of the above are key features or characteristics of segments reporting. |
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| 14 | |
Customer profitability analysis uses which of the following in determining how serving particular customers causes activities to be performed and costs to be incurred? |
| | A) | Activity-based costing |
| | B) | Traditional segment reporting |
| | C) | Normal costing |
| | D) | Standard costing |
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| 15 | |
The extent to which a product's capability in performing its intended purpose, viewed in relation to other products with the same functional use, is referred to as which of the following? |
| | A) | Quality of design |
| | B) | Quality of conformance |
| | C) | Grade |
| | D) | Product quality |
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| 16 | |
Which term is used to refer to the extent to which a product is designed to perform well in its intended use? |
| | A) | Quality of design |
| | B) | Quality of conformance |
| | C) | Grade |
| | D) | Product quality |
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| 17 | |
Which term is used to refer to the extent to which a product meets the specification of its design? |
| | A) | Quality of design |
| | B) | Quality of conformance |
| | C) | Grade |
| | D) | Product quality |
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| 18 | |
Into which type of cost are inspection costs classified? |
| | A) | Appraisal costs |
| | B) | External failure costs |
| | C) | Internal failure costs |
| | D) | Prevention costs |
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| 19 | |
Into which type of cost is the cost of reworking defective units to make them saleable classified? |
| | A) | Appraisal costs |
| | B) | External failure costs |
| | C) | Internal failure costs |
| | D) | Prevention costs |
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| 20 | |
The costs of replacing a starter motor on a tractor within one week after delivery to a customer would be classified as which of the following costs? |
| | A) | Appraisal costs |
| | B) | External failure costs |
| | C) | Internal failure costs |
| | D) | Prevention costs |
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| 21 | |
How are the costs of inspecting materials before they are entered into process are classified? |
| | A) | As appraisal costs |
| | B) | As external failure costs |
| | C) | As internal failure costs |
| | D) | As prevention costs |
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| 22 | |
Which of the following is true under the contemporary view of the optimal level of product quality? |
| | A) | It occurs when failure costs are equal to prevention and appraisal costs. |
| | B) | It occurs at the 1% defect level. |
| | C) | It occurs at the zero defect level. |
| | D) | It occurs when total quality costs are less than failure costs. |
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| 23 | |
A graphic presentation of the frequency with which various quality-control problems are observed is called which of the following? |
| | A) | Frequency chart |
| | B) | Pareto diagram |
| | C) | ISO 9000 standard |
| | D) | Cause and effect diagram |
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| 24 | |
Which is a tool used in total quality management (TQM) that aims at achieving near-perfect results in a production process? |
| | A) | Pareto diagram |
| | B) | Six Sigma |
| | C) | ISO 9000 standards |
| | D) | Frequency chart |
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| 25 | |
Which of the following is not true about the ISO 9000 Standards? |
| | A) | Their focus is on the manufacturer's quality control system. |
| | B) | They were developed in the United States. |
| | C) | They consist of five major parts. |
| | D) | They provide a model for quality assurances in design and production. |
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| 26 | |
Which major part of the ISO 9000 standards provides a model for quality assurance in design, development, production, installation, and servicing? |
| | A) | ISO 9001 |
| | B) | ISO 9002 |
| | C) | ISO 9003 |
| | D) | ISO 9004 |
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| 27 | |
Which major part of the ISO 9000 standards addresses quality assurance in final inspection and testing? |
| | A) | ISO 9001 |
| | B) | ISO 9002 |
| | C) | ISO 9003 |
| | D) | ISO 9004 |
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| 28 | |
Which major part of the ISO 9000 standards provides guidelines for the design of a quality management system? |
| | A) | ISO 9001 |
| | B) | ISO 9002 |
| | C) | ISO 9003 |
| | D) | ISO 9004 |
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| 29 | |
Which major part of ISO 9000 standards states the objectives of the standards, defines quality-related vocabulary, and provides guides to the other standards in the series? |
| | A) | ISO 9000 |
| | B) | ISO 9001 |
| | C) | ISO 9003 |
| | D) | ISO 9004 |
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| 30 | |
Which of the following statements is false? |
| | A) | Private environmental costs are borne by a company or individual. |
| | B) | Social environmental costs are borne by the public at large. |
| | C) | All social environmental costs are visible. |
| | D) | Environmental cost management is the systematic attempt to measure and control or reduce the private environmental costs borne by a company or other organization. |
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| 31 | |
Which of the environmental cost strategies involves modifying products and production processes to produce little or no pollutants? |
| | A) | Prevention strategy |
| | B) | End-of-pipe strategy |
| | C) | Process improvement strategy |
| | D) | None of the above |
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| 32 | |
Which of the environmental cost strategies involves cleaning up waste or pollutants before they are discharged into the environment? |
| | A) | Prevention strategy |
| | B) | End-of-pipe strategy |
| | C) | Process improvement strategy |
| | D) | None of the above |
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