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1) The income statement and balance sheet columns of Pine Company's worksheet reflects the following totals: Income Statement Dr. Totals
To enter the net income (or loss) for the period into the above worksheet requires an entry to the __________. A. income statement debit column and the income statement credit column B. income statement credit column and the balance sheet debit column C. income statement debit column and the balance sheet credit column D. balance sheet debit column and the balance sheet credit column
2) Multinational corporations __________. A. are firms that conduct their operations in more than one country through subsidiaries, divisions, or branches in foreign countries B. are U.S. companies that sell goods and services in other countries C. are required to use international accounting standards D. are U.S. companies that trade their securities on the exchanges in other countries
3) Balance sheet accounts are considered to be __________. A. capital accounts B. nominal accounts C. temporary stockholdersâ€™ accounts D. permanent accounts 4) What is value chain management best defined as? A. The incremental value of costs associated with hiring a new production floor leader
B. All activities associated with providing a product or service C. A large chain that keeps the machines from falling on the production floor D. Management decisions that affect how quickly the production run occurs 5) The primary purpose of the statement of cash flows is to __________. A. provide information about the cash receipts and cash payments during a period B. facilitate banking relationships C. provide information about the investing and financing activities during a period D. prove that revenues exceed expenses if there is a net income 6) In what situations will a static budget be most effective in evaluating a manager's effectiveness? A. The planned activity levels match actual activity levels. B. The company has no fixed costs. C. The company has substantial fixed costs. D. The company has substantial variable costs. 7) Which one of the following is a product cost? A. Sales personâ€™s salaries B. Advertising costs C. Indirect labor D. Office salaries 8) These are selected account balances on December 31, 2008. Land (location of the corporation's office building) Land (held for future use)
Corporate Office Building
What is the net amount of property, plant, and equipment that will appear on the balance sheet? A. $1,600,000 B. $950,000 C. $1,300,000 D. $1,100,000
9) Of the following companies, which one would not likely employ the specific identification method for inventory costing? A. Antique shop B. Music store specializing in organ sales
C. Hardware store D. Farm implement dealership 10) If a company reports a net loss, it __________. A. will not be able to get a loan B. may still have a net increase in cash C. will not be able to make capital expenditures D. will not be able to pay cash dividends 11) Disneyâ€™s variable costs are 30% of sales. The company is contemplating an advertising campaign that will cost $22,000. If sales are expected to increase $40,000, by how much will the company's net income increase? A. $12,000 B. $18,000 C. $6,000 D. $28,000
12) The cost principle requires that when assets are acquired, they be recorded at __________. A. selling price B. appraisal value C. list price D. exchange price paid
13) Which one of the following items is not generally used in preparing a statement of cash flows? A. Current income statement B. Adjusted trial balance C. Additional information D. Comparative balance sheets
14) Managerial accounting __________. A. pertains to the entity as a whole and is highly aggregated B. is concerned with costing products C. places emphasis on special-purpose information D. is governed by generally accepted accounting principles
15) A logical starting point from which the study of international trade begins is __________. A. the principle of absolute advantage B. the recognition that not all markets are competitive C. the principle of comparative advantage D. the recognition that government intervention in markets sometimes enhances the economic welfare of the society
16) Without trade, __________. A. a country can still benefit from international specialization B. a country is better off because it will have to learn to be self-sufficient without trade
C. interdependence is more extensive than it would be with trade D. a country's production possibilities frontier is also its consumption possibilities frontier
17) Assume oligopoly firms are profit maximizers, they do not form a cartel, and they take other firms' production levels as given. Then in equilibrium the output effect __________. A. must balance with the price effect B. must dominate the price effect C. must be smaller than the price effect D. can be larger or smaller than the price effect
18) To move the allocation of resources closer to the social optimum, policymakers should typically try to induce firms in an oligopoly to __________. A. compete rather than cooperate with each other B. collude with each other C. form various degrees of cartels D. cooperate rather than compete with each other 19) When, in a particular market, the law of demand and the law of supply both apply, the imposition of a binding price ceiling in that market causes quantity demanded to be __________. A. equal to quantity supplied B. greater than quantity supplied C. less than quantity supplied D. double the quantity supplied 20) If a price ceiling is a binding constraint on the market, __________. A. sellers cannot sell all they want to sell at the price ceiling B. the equilibrium price must be below the price ceiling C. there is excess supply D. buyers cannot buy all they want to buy at the price ceiling 21) A tax on an imported good is called a __________. A. supply tax B. quota C. tariff D. trade tax 22) The political business cycle refers to __________. A. the part of the business cycle caused by the reluctance of politicians to smooth the business cycle B. the fact that about every four years some politician advocates greater government control of the Fed C. the potential for a central bank to increase the money supply and therefore real GDP to help the incumbent get re-elected D. changes in output created by the monetary rule the Fed must follow 23) Real GDP __________. A. is not a valid measure of the economy's performance, since prices change from year to year.
B. evaluates current production at current prices. C. evaluates current production at the prices that prevailed in some specific year in the past. D. is a measure of the value of goods only; it excludes the value of services. 24) The model of short-run economic fluctuations focuses on the price level and __________. A. the neutrality of money B. real GDP C. economic growth D. Net GDP 25) In the market for foreign-currency exchange in the open economy macroeconomic model, the amount of net capital outflow represents the quantity of dollars __________. A. demanded for the purpose of buying U.S. net exports of goods and services B. supplied for the purpose of buying assets abroad C. supplied for the purpose of selling assets domestically D. demanded for the purpose of importing foreign goods and services 26) The open-economy macroeconomic model examines the determination of __________. A. the output growth rate and the inflation rate B. unemployment and the exchange rate C. the output growth rate and the real interest rate D. the trade balance and the exchange rate 27) The balance of payment account is made up of: A. an investment account and a consumption account. B. an import account and an export account. C. a current account and a financial and capital account. D. a monetary account and a fiscal account. 28) To be competitive in a global economy, Europeans must increase their level of: A. Espionage activity B. Philanthropic contributions C. Population density D. Productivity E. Financial subsidy 29) Which of these refers to the practices aimed at discovering and harnessing an organization's intellectual resources? A. Innovation B. Competitiveness C. Collaboration D. Knowledge management E. Effectiveness 30) ABC International carefully watches the actions of its most innovative competitor and learns from them. ABC can establish a low-cost position by: A. Learning from the leader thereby avoiding the costs and risks of technology leadership B. Mass-producing products that have an established market niche C. Making subtle changes to the product, thereby avoiding patent restrictions D. Producing an imitation of the new technology that utilizes lower-quality and lower-cost materials
E. Technology followers are not successful at low-cost strategies 31) The best way for an employer to find out if a potential employee can do a job is by __________. A. having them spend a day in the office B. administering an IQ test C. using the interview process D. using a written test E. using a performance simulation test
32) A manager's ability to stimulate people to be high performers is referred to as: A. Leading B. Supervising C. Organizing D. Planning E. Controlling
33) One of the most important contributors to total quality management has been the introduction of statistical tools to analyze the causes of product defects in an approach called: A. ISO 9000 B. Organic C. Total quality integration D. Six Sigma Quality E. Mechanistic 34) The pursuit of lucrative opportunities by enterprising individuals is called: A. Business incubating B. Social experimentation C. Independence D. Intrapreneurship E. Entrepreneurship 35) Listening to employee suggestions, gaining support for organizational objectives and fostering an atmosphere of teamwork are all considered: A. Diagnostic skills B. Conceptual C. Interpersonal/communication skills D. Technical skills E. Professional skills 36) Managers will utilize __________ skills with increasing frequency as they rise within an organization. A. Technical B. Professional C. Interpersonal and communication D. Conceptual and decision E. Professional 37) As related to managing of human resources, diversity refers to: A. Differences in demographics (such as age, race, gender, disability status, lifestyle, veteran status, educational level, etc.) B. Differences in retention strategies (such as training, hiring, incentives, etc) C. Differences in recruiting methods (such as newspapers, schools, flyers, magazines, agencies, etc.) D. Differences in employee benefit plans (such as pensions, insurance, vacations, memberships, etc.) E. Differences in pay methods (such as hourly, salaried, overtime, hazard-pay, commissioned, etc.)
38) The term used to refer to all kinds of differences including religious affiliation, age, disability status, economic class and lifestyle in addition to gender, race, ethnicity and nationality is: A. Selection B. Managerial ethics C. Employment D. Diversity E. Recruiting 39) Your roommate is interested in starting a business and everybody has been giving him different information about being an entrepreneur. Since you have been studying about entrepreneurship and new ventures, which of these would you tell him is true? A. Money should not be considered a start-up ingredient B. All entrepreneurs need venture capital in order to get started C. Entrepreneurs are their own bosses and completely independent D. Anyone can start a business E. Successful entrepreneurs take very careful, calculated risks 40) Which of these represent skills that managers need? A. Professional, technical and interpersonal & communication B. Interpersonal & communication, conceptual & decision making and professional C. Interpersonal, quantitative, and professional D. Technical, interpersonal & communication and conceptual & decision making E. Conceptual & decision making, professional and technical 41) The basic components of an effective sexual harassment policy include the following EXCEPT: A. To establish a formal complaint procedure B. To develop an organization wide policy on sexual harassment C. To establish a means for ongoing training D. To establish a performance appraisal system E. To act immediately when employees complain of sexual harassment 42) Which of the following statements is true? A. The sum of two mutually exclusive events is one. B. If event (A) occurs, then its complement (A') will also occur. C. If A and B are independent events, the P(B) = P(A) P(B). D. The probability of A and its complement (A') will always sum to one.
43) Dullco Manufacturing claims that its alkaline batteries last forty hours on average in a certain type of portable CD player. Tests on a random sample of 18 batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4 hours. In a left-tailed test at = .05 we would __________. A. comfortably accept the claim B. switch to alpha of 0.01 for a more powerful test C. comfortably reject the claim D. feel uncomfortable with either decision (too close)
44) A poll showed that 48 out of 120 randomly chosen graduates of California medical schools last year intended to specialize in family practice. What is the width of a 90% confidence interval for the proportion that plan to specialize in family practice? A. ± .07357 B. ± .08765 C. ± .04472 D. ± .00329
45) Use the following table to answer question: P(S | W) is approximately _____. A. .40 B. .12 C. .58 D. .30
46) Twelve randomly-chosen students were asked how many times they had missed class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18. For this sample, which measure of central tendency is least representative of the “typical” student? A. Mode B. Mean C. Midrange D. Median 47) In a right-tail test, a statistician came up with a z test statistic of 1.469. What is the p-value? A. .0708 B. .0301 C. .0874 D. .4292
48) In lean systems, if a defective product is found, which of the following is generally NOT done? A. The defective unit is returned to the worker responsible for creating the defect. B. The production line is stopped. C. The defective unit is passed on to the next workstation. D. The production line is made aware of the problem without stopping the line.
49) A computer analysis reveals that the best-fitting trend model is Yt = 4.12 e 0.987 t. The trend was fitted using year-end common stock prices for Melodic Kortholt Outlet for the last six years. The R2 is 0.8571. Which conclusion is not correct? A. Few investments could match the astounding growth rate. B. The stock's true intrinsic value is $4.12. C. At the end of year 3 the stock price would be nearly $80. D. The absolute annual growth (in dollars per share) is increasing.
50) In statistical process control a p-chart could __________. A. have more than one characteristics B. measure the fraction of conforming parts in a sample C. measure the number of defects per sample unit D. use the student's distribution 51) Which one of the following statements concerning production and staffing plans is best? A. Production plans are based primarily on information from the master production plan. B. A staffing plan is the intermediate link between the business plan and the master production schedule. C. Aggregation can be performed along three dimensions: product families, labor, and time. D. A master production schedule is a projected statement of income, costs, and profits.
52) Which one of the following statements about managerial inputs to production and staffing plans is best? A. Marketing provides new product or service developments. B. Human resources provide the training capacity and labor-market conditions. C. Finance provides labor and machine standards. D. Materials provide the current staffing level. 53) The costs of delivering products in the _____ channel are much higher than delivering products in the _____ channel. A. digital, physical B. physical, financial C. digital, e-commerce D. physical, digital E. e-commerce, digital
54) _____ is the integration of economic, social, cultural, and ecological facets of life, enabled by information. A. globalization B. nationalization C. regionalization D. business environment
55) Which of the following statements is correct? A. An individual’s right to privacy supersedes the needs of society B. Advances in information technologies have not affected individual privacy C. It is difficult to determine and enforce privacy regulations D. The Internet has increased individuals’ privacy E. An individual’s right to privacy is absolute 56) In the _____ phase of the decision making process, managers test potential solutions “on paper.” A. design B. intelligence C. choice D. consideration E. implementation
57) Which of the following is NOT an advantage of the buy option for acquiring IS applications? A. saves time B. saves money C. software can be tried out D. company will know what it is getting E. few types of off-the-shelf software are available, thus limiting confusion
58) Which of the following is not a reason that managers need IT support? A. Decisions are becoming more complex B. Decision makers are often in different locations C. Decisions must typically be made under time pressure D. Need to access remote information sources E. Number of alternatives are decreasing 59) _____ is a process that helps organizations identify, select, organize, disseminate, transfer, and apply expertise that are part of the organization’s memory and typically reside inside the organization in an unstructured manner. A. Decision support B. Data mining C. Knowledge management D. Online analytical processing E. Discovery 60) Information-based industries are most susceptible to which one of Porter’s five forces? A. threat of substitute products B. rivalry among existing firms in an industry C. bargaining power of customers D. bargaining power of suppliers 61) _____ is the acquisition and efficient use of resources in accomplishing organizational goals. A. Strategic planning B. Wisdom C. Management control D. Expertise E. Operational control 62) _____ is the efficient and effective execution of specific tasks. A. Strategic planning B. Wisdom C. Management control D. Expertise E. Operational control
63) Disadvantages of using current liabilities as opposed to long-term debt include: A. higher cash flow exposure B. certainty of interest costs C. uncertainty of future liabilities D. decreased risk of liquidity E. greater risk of illiquidity, and uncertainty of interest costs
64) Bondholders have a priority claim on assets ahead of: A. investors B. common and preferred stockholders. C. creditors. D. shareholders. 65) Which of the following best represents operating income? A. Income from capital gains B. Income after financing activities C. Income from discontinued operations D. Earnings before interest and taxes 66) Which of the following is most consistent with the hedging principle in working capital management? A. Fixed assets should be financed with short-term notes payable. B. Inventory should be financed with preferred stock. C. Accounts receivable should be financed with short-term lines of credit. D. Borrow on a floating rate basis to finance investments in permanent assets.
67) PepsiCo calculates unlevered betas for each peer group in order to: A. eliminate judgment factors. B. eliminate different business risks. C. eliminate different financial risks. D. eliminate competitive factors. 68) A stock with a beta greater than 1.0 has returns that are _____ volatile than the market, and a stock with a beta of less than 1.0 exhibits returns which are _____ volatile than those of the market portfolio. A. less, more B. more, more C. less, less D. more, less 69) The common stockholders are most concerned with: A. the risk of the investment. B. the percentage of profits retained. C. the spread between the return generated on new investments and the investorâ€™s required rate of return. D. the size of the firmâ€™s beginning earnings per share. 70) An increase in future value can be caused by an increase in the __________. A. original amount invested B. annual interest rate and number of compounding periods
C. dividends paid D. rate of return E. starting value 71) A machine costs $1,000, has a three-year life, and has an estimated salvage value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year, starting next year. If your required rate of return for the project is 10%, what is the NPV of this investment? (Round your answerwer to the nearest $10.) A. $900 B. $490 C. -$150 D. $570 72) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per share. If the stock is currently selling for $21.25 per share, what is the expected rate of return on this stock? A. 8.0% B. 36.13% C. 13.6% D. 12.5% 73) Exchange rate risk: A. has been phased out due to recent international legislation. B. arises from the fact that the spot exchange rate on a future date is a random variable. C. applies only to certain types of domestic businesses. D. doesnâ€™t affect trades made in US Dollars. 74) If the quote for a forward exchange contract is greater than the computed price, the forward contract is: A. a good buy. B. overvalued. C. undervalued. D. at equilibrium.
75) Which of the following best represents the stream of income that is available to common stockholders? A. Gross profit B. Net profit after tax and after preferred dividend payments C. Earnings before interest and taxes D. Operating profit 76) The statement, "Of course people will buy our product--each of its features is better than the competition," most closely reflects which consumer behavior concept? A. needs B. reference groups C. psychographics D. the economic-buyer theory E. competitive advantage 77) A firm's "marketing mix" decision areas would NOT include: A. Price. B. People. C. Promotion. D. Place. E. Product. 78) Clustering techniques applied to segmenting markets __________.
A. eliminate the need for marketing managers to specify in advance what dimensions might be relevant for grouping consumers B. remove the need for managerial judgment C. usually require computers to group people based on data from market research D. doesnâ€™t apply to demographic data E. is time consuming and expensive 79) The "four Ps" of a marketing mix are: A. Production, Personnel, Price, and Physical Distribution B. Promotion, Production, Price, and People C. Potential customers, Product, Price, and Personal Selling D. Product, Price, Promotion, and Profit E. Product, Place, Promotion, and Price 80) The managerial process of developing and maintaining a match between the resources of an organization and its market opportunities is called: A. marketing strategy planning. B. marketing programming. C. management by objective. D. market planning. E. strategic (management) planning.
81) The economists' view of buyers: A. assumes that they always buy the lowest-price alternative. B. is based on the idea that consumers value time and select the first alternative they learn about. C. puts a great deal of emphasis on differences in buying behavior related to individual differences among consumers. D. None of these are true E. emphasizes psychological variables rather than social influences. 82) __________ is a marketing management aid which refers to how customers think about proposed and/or present brands in a market. A. Market scanning B. Positioning C. Brand familiarity D. Customer relationship management (CRM) E. Market segmentation 83) In comparison to the buying of final consumers, the purchasing of organizational buyers: A. leans basically toward economy, quality, and dependability. B. is even less predictable. C. is always based on competitive bids from multiple suppliers. D. is strictly economic and not at all emotional. E. is always emotional. 84) Regarding organizational buying, the people who have the power to select or approve the supplier-especially for larger purchases--are called: A. buyers. B. gatekeepers.
C. deciders. D. influencers. E. users. 85) An Australian wine producer, facing declining sales at home, set up a new channel of distribution to sell wine in the United States. This seems to be an effort at: A. market penetration. B. product development. C. diversification. D. market development. E. stratification. 86) The three basic tasks of ALL managers, according to the text, are: A. execution, feedback, and control. B. hiring, training, and compensating. C. marketing, production, and finance. D. planning, staffing, and evaluating. E. planning, implementation, and control.
87) The managerial process of developing and maintaining a match between the resources of an organization and its market opportunities is called: A. marketing strategy planning. B. strategic (management) planning. C. marketing programming. D. management by objective. E. market planning. 88) Which of the following is correct about interpretive rules? A. They must be accompanied by substantive rules. B. All federal administrative agencies have implied power to make interpretive rules. C. They require public notice and participation to create. D. They do not establish new law. E. Interpretive rules are not subject to judicial review. 89) To be guilty of monopolization, the defendant must: A. Must be part of a conspiracy, combination, or contract. B. Be a US company. C. Have been previously convicted. D. Possess monopoly power and have obtained the monopoly power by some improper act or be abusing the monopoly power. E. Have obtained the monopoly power from the government. 90) The tort of intentional interference with contractual relations requires the following except: A. Third-party inducement to breach the contract. B. A new contract involving the third party who induced the breach. C. Third-party knowledge of this contract. D. A valid, enforceable contract between the contracting parties. 91) The tort of palming off involves: A. Failing to credit another for that other personâ€™s legal accomplishments. B. Representing oneâ€™s own goods to be those of a competitor. C. Making false statements about the goods of another. D.
Knowingly selling goods that are defective. E. Blaming another for one’s own actions and communicating that blame to at least one other person.
92) Which of the following is correct about litigating commercial disputes? A. A few states have established specialized trial courts for commercial disputes. B. In all states, commercial disputes must be heard in a limited-jurisdiction court. C. Businesses generally dislike the concept of specialized trail courts for commercial disputes because the large numbers of consumers who sue businesses in these courts have led the judges to become generally biased against business. D. Nearly all states have specialized trial courts that hear commercial disputes. E. Commercial disputes, because of their specialized nature, are first heard at the appellate court level.
93) An agent’s duty of notification can best be described as a duty to: A. Notify the principal about any material information that the agent learns relative to the subject matter of the agency. B. Notify the principle only if the principle if acting as an agent C. Notify the principal a reasonable period of time in advance of terminating the agency arrangement. D. Notify any third parties that the agent is acting as an agent. E. Notify any third parties as to the identity of the principal. 94) Which of the following statements is true regarding the relationship of law and ethics? A. In some cases the law will require a higher standard of conduct than ethics, but never vice versa. B. Depending on the circumstances, the law can require a higher, lower, or the same standard of conduct as ethics demands. C. In some cases ethics will require a higher standard of conduct than the law, but never vice versa. D. The legal requirements will almost always be the same as the ethical requirement because the law is based on the ethical standards.
95) Which of the following is true about “proof of claims?” A. They are never used by secured creditors. B. They must be field by both secured and unsecured creditors in order for the creditor to receive a distribution from the bankruptcy estate. C. They need not be filed by secured creditors whose security covers the amount of their debt. D. They can generally be filed any time within one year of the filing of the bankruptcy petition.
96) An agentâ€™s obligation to perform in accordance with the terms of the agency arrangement is the agentâ€™s duty of: A. Indemnification. B. Obedience. C. Loyalty. D. Performance. E. Nonbreach. 97) Which social responsibility theory has been advocated by Novel Prizewinning economist Milton Friedman? A. Stakeholder interest. B. Maximizing profits. C. Moral minimum. D. Corporate citizenship. E. Corporate social audit.
98) Which country does the text describe as becoming the largest producer and consumer of many of the world's goods? A. Mexico B. Japan C. Canada D. China E. Ecuador
99) One study found that manufacturing labor costs about _____ an hour in China, compared to _____ dollars in the United States. A. Less than $1; about 25 B. Less than $1; about 15 C. About $2; about 15 D. $2; about 25 E. Less than $1; about 40 100) Although the U.S. has had a longstanding agreement with _____ after the passage of NAFTA, _____ became the United States' second largest trading partner. A. Mexico, Canada B. Canada, Venezuela C. Canada, Mexico D. Mexico, Venezuela E. Great Britain, Paraguay