GSU ACCT 2102 - Final Exam Review Spring 2018 (31 pages)

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Final Exam Review Spring 2018



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Final Exam Review Spring 2018

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Pages:
31
School:
Georgia State University
Course:
Acct 2102 - Prin of Acct Ii
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Final Exam Review Spring 2018 1 When a company invests in a capital asset recouping the original investment is called return on investment Unit 9 1 LO1 False When a company invests in a capital asset recouping the original investment is called return of investment 1 2 Capital budgeting decisions involve both outflows of cash at one or more times and inflows of cash at other times Unit 9 2 LO2 True LO 2 Bloom K Unit 9 2 Difficulty Easy Min 1 AACSB Analytic AICPA FN Decision Modeling AICPA PC Problem Solving and Decision Making IMA Investment Decisions 2 3 A dollar received today is a Worth less than a dollar received in the future discounted at 12 interest b Worth more than a dollar received at any time in the future c Worth less than a dollar received in the future if the current interest rate is lower than the anticipated future interest rate d None of these answer choices are correct Unit 9 2 LO2 B 3 4 Dina Jones just learned that she received an inheritance from her grandmother The inheritance provides for Dina to receive 5 000 per year at the end of the year for each of the next 5 years Using the following factors what is the value of this inheritance to Dina today Type of cash flow PV of 1 FV of 1 n Periods 5 5 i Interest rate 10 10 PV ordinary annuity 5 10 FV ordinary annuity 5 10 PV annuity due 5 10 a b c d 15 523 20 849 18 954 30 526 Unit 9 2 LO2 C 4 Factor 62092 1 6105 1 3 7907 9 6 1051 0 4 16986 LO 2 Bloom C Unit 9 2 Difficulty Easy Min 2 AACSB Analytic AICPA FN Measurement AICPA PC Problem Solving and Decision Making IMA Cost Management Solution 5 000 x 3 79079 18 954 5 Welcher Inc plans to purchase equipment with a cost of 142 500 The company expects annual cash inflows from the equipment of 30 000 The equipment has an estimated life of 8 years no estimated salvage life and a required rate of return is 6 The payback period for the equipment is closest to a 1 year b 1 5 years c 5 years d 8 years Unit 9 4 LO5 C LO 5 Bloom AP Unit 9 4 Difficulty Easy Min 3 AACSB Analytic AICPA FN Measurement AICPA PC Problem Solving and Decision Making IMA Investment Decisions Solution 142 500 30 000 4 75 years closest to 5 years 5 6 If a cost was incurred to support the company as a whole then it is a common cost Ans T LO 2 Bloom K Unit 10 2 Difficulty Moderate Min 1 AACSB Analytic AICPA FN Reporting AICPA PC Communication IMA Performance Measurement 6 7 At Devoe Manufacturing the Southern Division is responsible for the production and selling of products in fifteen states This division is an example of which of the following responsibility centers a Cost center b Revenue center c Profit center d Investment center Ans C LO 1 Bloom AP Unit 10 1 Difficulty Moderate Min 2 AACSB Communication AICPA FN Reporting AICPA PC Communication IMA Performance Measurement 7 8 Sphinx division of Shepherd Corporation generated division generated net revenues of 12 000 000 and variable expenses of 7 700 000 If common corporate fixed costs were 1 000 000 and the segment margin was 1 300 000 what are the division s direct fixed expenses a 4 300 000 b 3 000 000 c 300 000 d The answer cannot be determined from the information given Ans B LO 2 Bloom AP Unit 10 2 Difficulty Easy Min 2 AACSB Communication AICPA FN Decision Modeling AICPA PC Problem Solving and Decision Making IMA Decision Analysis Solution 12 000 000 7 700 000 X 1 300 000 X 3 000 000 8 9 Noble Corporation had sales of 3 000 000 and operating income of 500 000 Noble also had 900 000 of assets on January 1 and 800 000 on December 31 What is the corporation s ROI for the year a 26 7 b 35 3 c 58 8 d 59 9 Ans C LO 3 Bloom AP Unit 10 3 Difficulty Easy Min 3 AACSB Analytic AICPA FN Measurement AICPA PC Problem Solving and Decision Making IMA Performance Measurement Solution 500 000 900 000 800 000 2 58 8 9 10 Bethlehem Corporation had 1 000 000 in sales which resulted in operating income of 62 000 On January 1 Bethlehem reported 920 000 in assets Because of a downturn in the economy Bethlehem sold several assets during the year Its December 31 balance sheet reported only 580 000 in assets Required a Calculate Bethlehem s margin b Calculate Bethlehem s asset turnover c Calculate Bethlehem s return on investment Solution a 62 000 1 000 000 6 2 b 1 000 000 750 000 1 33333 c 062 x 1 3333 8 27 10 11 Match the following terms to the appropriate statement by placing the letter to the left of each statement a Balanced scorecard b c d e f Learning and growth perspective g Manufacturing cycle efficiency h Manufacturing cycle time i Performance dashboards j Strategy map Benchmarking Delivery cycle time Financial perspective Internal business process perspective 1 A visual display of the key measures related to an organization s operational goals and strategies 2 A management tool that integrates performance measures across four different perspectives to guide operations toward achieving an organization s strategy 3 Answers the question Are we developing employees and providing technologies that facilitate change and improvement 4 The practice of using data from other organizations to identify the processes and practices associated with world class performance 5 The time between an order s placement and its shipment 6 The time from the start of production to the shipment of the product to the customer 7 Answers the question How do investors see us 8 A pictorial representation of the cause and effect relationships embodied in the strategy 9 The ratio of value added processing time to total manufacturing time 10 Focuses on creating products and services that customers desire and delivering them in a timely manner 1 2 3 4 5 6 7 8 9 10 i Performance dashboard a Balanced scorecard f Learning and growth perspective b Benchmarking c Delivery cycle time h Manufacturing cycle time d Financial perspective j Strategy map g Manufacturing cycle efficiency e Internal business processes perspective 11 12 Midland Industries is the manufacturer of metal frame backyard pools and pool accessories The controller of the company recognizes that the success of the company depends on both financial and nonfinancial measures Place an X in the appropriate columns to indicate whether the following measures are leading or lagging and financial or nonfinancial Leadin g Laggin g Current ratio Quality of product Design software reported bugs Direct labor rate variance Makeup of skilled versus unskilled labor Number of product returns Number of customer complaints Net income Customer


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