Question 1

Which of the following requires that quality be manufactured rather than inspected into products?

Accepted Answer

A)  ABC 
B)  JIT 
C)  Restructured environment 
D)  TMP 
A)  ABC 
B)  JIT 
C)  Restructured environment 
D)  TMP

Question 2

Which of the following is a management philosophy on increasing profitability by improving the quality of products and processes?

Accepted Answer

A)  Balanced scorecard management 
B)  Costs of quality measurement 
C)  Process management 
D)  Total quality management 
A)  Balanced scorecard management 
B)  Costs of quality measurement 
C)  Process management 
D)  Total quality management

Question 3

Costs incurred to train production employees are:

Accepted Answer

A)  Prevention costs 
B)  Appraisal costs 
C)  Internal failure costs 
D)  External failure costs 
A)  Prevention costs 
B)  Appraisal costs 
C)  Internal failure costs 
D)  External failure costs

Question 4

Exhibit 24-1 Shriber Company had the following balance sheet at the end of 2012:
  Refer to Exhibit 24-1. Shriber Company had $223,400 in operating income before taxes this year, a tax rate of 25% and a weighted average cost of capital of 16%. Using this information, determine Shriber's economic value added for 2012.

Accepted Answer

A)  $25,552 
B)  $167,550 
C)  $141,998 
D)  $11,020 
A)  $25,552 
B)  $167,550 
C)  $141,998 
D)  $11,020

Question 5

A company's interest-bearing debt and stockholders' equity is equal to its:

Accepted Answer

A)  Average total assets 
B)  Invested capital 
C)  Return on investment 
D)  Weighted average cost of capital 
A)  Average total assets 
B)  Invested capital 
C)  Return on investment 
D)  Weighted average cost of capital

Question 6

Match between columns
                        Premises: Paying the accounts payable
Preparing financial statements for clients
Preparing tax returns for clients
Assisting clients with their accounting systems
Preparing internal financial statements
Reformatting layout of financial statements
Helping clients to develop tax-saving strategies
Redesigning its website
Maintaining computer systems
Updating clients' fixed asset records

Accepted Answer

The Answer of value-added and non-value added is...

Question 7

The amount of warranty claims due to product defects would be classified as a(n):

Accepted Answer

A)  Prevention costs 
B)  Appraisal costs 
C)  Internal failure costs 
D)  External failure costs 
A)  Prevention costs 
B)  Appraisal costs 
C)  Internal failure costs 
D)  External failure costs

Question 8

A performance measure that monitors a company's commitment to warranty its product would be called a(n):

Accepted Answer

A)  Service-after-sale process measure 
B)  Innovation process measure 
C)  Financial performance measure 
D)  Operations process measure 
A)  Service-after-sale process measure 
B)  Innovation process measure 
C)  Financial performance measure 
D)  Operations process measure

Question 9

A performance measurement system that emphasizes the income earned over and above the income required to cover the cost of capital is:

Accepted Answer

A)  Operating profit 
B)  Economic value added 
C)  Return on investment 
D)  Return on income 
A)  Operating profit 
B)  Economic value added 
C)  Return on investment 
D)  Return on income

Question 10

Which of the following is NOT true of the balanced scorecard approach to performance measurement?

Accepted Answer

A)  It can be effective in manufacturing, merchandising, and service firms 
B)  The measures developed must match the company's strategy and vision 
C)  The measures should be linked such that improvement on one measure should lead to improvement in related measures 
D)  A standard balanced scorecard can be developed to suit many organizations 
A)  It can be effective in manufacturing, merchandising, and service firms 
B)  The measures developed must match the company's strategy and vision 
C)  The measures should be linked such that improvement on one measure should lead to improvement in related measures 
D)  A standard balanced scorecard can be developed to suit many organizations

Question 11

Costs incurred to repair products under warranty are:

Accepted Answer

A)  Prevention costs 
B)  Appraisal costs 
C)  Internal failure costs 
D)  External failure costs 
A)  Prevention costs 
B)  Appraisal costs 
C)  Internal failure costs 
D)  External failure costs

Question 12

Which of the following is NOT true regarding changes in accounting information that external users desire?

Accepted Answer

A)  Users generally need more nonfinancial information 
B)  Users generally desire more objective and verifiable information 
C)  Users generally desire less detailed information 
D)  Users generally desire information more frequently than at year-end 
A)  Users generally need more nonfinancial information 
B)  Users generally desire more objective and verifiable information 
C)  Users generally desire less detailed information 
D)  Users generally desire information more frequently than at year-end

Question 13

Which of the following is NOT one of the components of residual income?

Accepted Answer

A)  Operating profit 
B)  Average total assets 
C)  Weighted average cost of capital 
D)  Minimum required rate of return 
A)  Operating profit 
B)  Average total assets 
C)  Weighted average cost of capital 
D)  Minimum required rate of return

Question 14

The just-in-time inventory system increases:

Accepted Answer

A)  Inventory levels 
B)  Centralized support 
C)  The number of costs to allocate 
D)  None of these are correct 
A)  Inventory levels 
B)  Centralized support 
C)  The number of costs to allocate 
D)  None of these are correct

Question 15

A balanced scorecard approach to performance measurement would allow the inclusion of all BUT which of the following measures?

Accepted Answer

A)  Measures of customer satisfaction 
B)  Measures of financial performance 
C)  Measures of worker satisfaction 
D)  All of these could be measures in a balanced scorecard 
A)  Measures of customer satisfaction 
B)  Measures of financial performance 
C)  Measures of worker satisfaction 
D)  All of these could be measures in a balanced scorecard

Question 16

Which of the following is a measure of performance that, if accomplished, should lead to a desired result?

Accepted Answer

A)  Lagging indicators 
B)  Leading indicators 
C)  Outcome indicators 
D)  Market share indicators 
A)  Lagging indicators 
B)  Leading indicators 
C)  Outcome indicators 
D)  Market share indicators

Question 17

An example of a leading performance measure is:

Accepted Answer

A)  Number of new customers 
B)  Customer retention rates 
C)  Average response time for a service call 
D)  Company's percent of total number of customers in the market 
A)  Number of new customers 
B)  Customer retention rates 
C)  Average response time for a service call 
D)  Company's percent of total number of customers in the market

Question 18

When using the just-in-time inventory system, production schedules are based on:

Accepted Answer

A)  Raw material inventory levels 
B)  The customers' demand 
C)  Machine and labor capacity 
D)  Predetermined levels of production 
A)  Raw material inventory levels 
B)  The customers' demand 
C)  Machine and labor capacity 
D)  Predetermined levels of production

Question 19

Adoption of a just-in-time inventory system:

Accepted Answer

A)  Avoids a buildup of parts and inventory 
B)  Provides an accurate allocation of costs 
C)  Replaces direct allocation as the most accurate method of assigning overhead cost 
D)  Is based on a demand push theory 
A)  Avoids a buildup of parts and inventory 
B)  Provides an accurate allocation of costs 
C)  Replaces direct allocation as the most accurate method of assigning overhead cost 
D)  Is based on a demand push theory

Question 20

Customer satisfaction is the result of the right combination of:

Accepted Answer

A)  Cost, quality and time 
B)  Cost, quality, and product performance 
C)  Discounts, quality and customer support 
D)  Quality, time and product warranty 
A)  Cost, quality and time 
B)  Cost, quality, and product performance 
C)  Discounts, quality and customer support 
D)  Quality, time and product warranty

Exam 24: New Measures of Performance

Which of the following requires that quality be manufactured rather than inspected into products?

Which of the following is a management philosophy on increasing profitability by improving the quality of products and processes?

Costs incurred to train production employees are:

A company's interest-bearing debt and stockholders' equity is equal to its:

The amount of warranty claims due to product defects would be classified as a(n):

A performance measure that monitors a company's commitment to warranty its product would be called a(n):

A performance measurement system that emphasizes the income earned over and above the income required to cover the cost of capital is:

Which of the following is NOT true of the balanced scorecard approach to performance measurement?

Costs incurred to repair products under warranty are:

Which of the following is NOT true regarding changes in accounting information that external users desire?

Which of the following is NOT one of the components of residual income?

The just-in-time inventory system increases:

A balanced scorecard approach to performance measurement would allow the inclusion of all BUT which of the following measures?

Which of the following is a measure of performance that, if accomplished, should lead to a desired result?

An example of a leading performance measure is:

When using the just-in-time inventory system, production schedules are based on:

Adoption of a just-in-time inventory system:

Customer satisfaction is the result of the right combination of:

Accounting Information: Users and Uses

Financial Statements: An Overview

The Accounting Cycle: The Mechanics of Accounting

Completing the Accounting Cycle

Internal Controls: Ensuring the Integrity of Financial Information

Receivables: Selling a Product or a Service

Inventory and the Cost of Sales

Completing the Operating Cycle

Investments: Property, Plant, and Equipment and Intangible Assets

Financing: Long-Term Liabilities

Financing: Equity

Investments: Debt and Equity Securities

Statement of Cash Flows

Analyzing Financial Statements

Management Accounting and Cost Concepts

Cost Flows and Business Organizations

Activity-Based Costing

Budgeting and Control

Controlling Cost and Profit

Inventory Management and Variable and Absorption Costing

Cost Behavior and Decisions Using C-V-P Analysis

Relevant Information and Decisions

Capital Investment Decisions

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