MBA 620 COMPREHENSIVE STUDY GUIDE
2026 FULL QUESTIONS AND SOLUTIONS
◉Earnings per share will increase when: Answer: depreciation
decreases.
◉According to Generally Accepted Accounting Principles (GAAP),
the cost of goods sold is: Answer: matched with revenues.
◉If a firm is profitable and pays income taxes, depreciation expense:
Answer: decreases both operating income and net income.
◉During a period of one year, which one of the following choices is
most likely to be a fixed, rather than variable, cash expense?
A. Raw materials cost
B. Bond interest
C. Commissions paid to sales representatives
D. Depreciation
E. Manufacturing labor costs Answer: B. Bond Interest
2026 FULL QUESTIONS AND SOLUTIONS
◉Earnings per share will increase when: Answer: depreciation
decreases.
◉According to Generally Accepted Accounting Principles (GAAP),
the cost of goods sold is: Answer: matched with revenues.
◉If a firm is profitable and pays income taxes, depreciation expense:
Answer: decreases both operating income and net income.
◉During a period of one year, which one of the following choices is
most likely to be a fixed, rather than variable, cash expense?
A. Raw materials cost
B. Bond interest
C. Commissions paid to sales representatives
D. Depreciation
E. Manufacturing labor costs Answer: B. Bond Interest
