ETS Business Exam Study Guide Solved 2025 #7
Accounting: What costs should be considered when making non-routine decisions? (3) -
correct answer The price of material, Factory overhead costs, and the price of labor
Accounting: Total product/ units produced and sold equals?? - correct answer Product
Cost per Unit
Accounting: What is a general explanation of what the contribution margin is? - correct
answer The difference between variable costs subtracted from sales
Accounting: In a continuous budget plan how many months are generally planned? -
correct answer 12 months
Accounting: Which of the following is not one of the weaknesses of standard costing -
correct answer It makes accounting for price increases more accurate
Accounting: What are the potential ways to find the price of what a produced products
should cost? (3) - correct answer Product cost concept, total cost concept, and variable
cost concept
Accounting: Which report is the connecting link between the income statement and the
balance sheet? - correct answer Cash flow statement
The net cash flow from operating activities normally differs from the amount of net
income for the period. - correct answer True
Accounting: Expense accounts would have a balance on which side? - correct answer
Left side
Accounting: A profit-making business operating as a separated legal entity and in which
ownership is divided into shares of stock is known as a... - correct answer Corporation
Accounting: A debt may slightly - correct answer Increase in an asset account
Accounting: What would be classified as a current asset on the balance sheet - correct
answer Accounts receivable
Accounting: What are the elements of internal control? (3) - correct answer Control
environment, monitoring, and control procedures.
True or False: A cash distribution of earnings by a corporation to its stockholders is
called a CASH DIVIDEND. The 3 conditions that a corporation must meet to pay a cash
dividend are: sufficient retained earnings, sufficient cash, and formal action by the board
of directors. - correct answer True
, Accounting: Factors in computing depreciation are? - correct answer Initial cost +
residual value = depreciable
Accounting: The statement of cash flows reports a firm's major cash inflows and
outflows for a period. It provides useful information about a company's ability to do the
following?? - correct answer Meet its financial obligations, generate cash from
operations, and maintain and expand its operating capacity
Accounting: True or False: Notes receivables are amounts that customers owe for
which a formal, written instrument of credit has been issued. If longer than a year it is
considered an investment. - correct answer True
Accounting: The excess of current assets of a business over its current liabilities is
called? - correct answer Working capital
Accounting: What 2 categories are considered under period costs? - correct answer
selling expenses and administrative expenses
Accounting: The effect of a difference in the number of units sold, assuming no charge
in unit sales price or unit cost is... - correct answer Quantity factor
Accounting: A cost that will not be affected by later decisions is termed an - correct
answer Sunk Cost
Accounting: The unfavorable volume variance may be due to all but the following facts...
- correct answer Unexpected increases in the cost of utilities
Accounting: What budget allows for adjustments in activity levels? - correct answer
Flexible budget
Accounting: A budget that summarizes future plans for the acquisition of fixed assets is
the... - correct answer Capital expenditures budget
Accounting: What are the standard framework of guidelines for financial accounting
used in any given jurisdiction, also known as accounting standards?? - correct answer
GAAP
Economics: What occurs when the price level rises? - correct answer People need to
hold more money, so interest rates rise, making firms borrow and invest less
Economics: The federal government enacted regulation in the 1960's requiring people
to wear seatbelt in their cars. All of the following resulted from this regulation, EXCEPT:
- correct answer Fewer pedestrians were killed in car accidents.
Accounting: What costs should be considered when making non-routine decisions? (3) -
correct answer The price of material, Factory overhead costs, and the price of labor
Accounting: Total product/ units produced and sold equals?? - correct answer Product
Cost per Unit
Accounting: What is a general explanation of what the contribution margin is? - correct
answer The difference between variable costs subtracted from sales
Accounting: In a continuous budget plan how many months are generally planned? -
correct answer 12 months
Accounting: Which of the following is not one of the weaknesses of standard costing -
correct answer It makes accounting for price increases more accurate
Accounting: What are the potential ways to find the price of what a produced products
should cost? (3) - correct answer Product cost concept, total cost concept, and variable
cost concept
Accounting: Which report is the connecting link between the income statement and the
balance sheet? - correct answer Cash flow statement
The net cash flow from operating activities normally differs from the amount of net
income for the period. - correct answer True
Accounting: Expense accounts would have a balance on which side? - correct answer
Left side
Accounting: A profit-making business operating as a separated legal entity and in which
ownership is divided into shares of stock is known as a... - correct answer Corporation
Accounting: A debt may slightly - correct answer Increase in an asset account
Accounting: What would be classified as a current asset on the balance sheet - correct
answer Accounts receivable
Accounting: What are the elements of internal control? (3) - correct answer Control
environment, monitoring, and control procedures.
True or False: A cash distribution of earnings by a corporation to its stockholders is
called a CASH DIVIDEND. The 3 conditions that a corporation must meet to pay a cash
dividend are: sufficient retained earnings, sufficient cash, and formal action by the board
of directors. - correct answer True
, Accounting: Factors in computing depreciation are? - correct answer Initial cost +
residual value = depreciable
Accounting: The statement of cash flows reports a firm's major cash inflows and
outflows for a period. It provides useful information about a company's ability to do the
following?? - correct answer Meet its financial obligations, generate cash from
operations, and maintain and expand its operating capacity
Accounting: True or False: Notes receivables are amounts that customers owe for
which a formal, written instrument of credit has been issued. If longer than a year it is
considered an investment. - correct answer True
Accounting: The excess of current assets of a business over its current liabilities is
called? - correct answer Working capital
Accounting: What 2 categories are considered under period costs? - correct answer
selling expenses and administrative expenses
Accounting: The effect of a difference in the number of units sold, assuming no charge
in unit sales price or unit cost is... - correct answer Quantity factor
Accounting: A cost that will not be affected by later decisions is termed an - correct
answer Sunk Cost
Accounting: The unfavorable volume variance may be due to all but the following facts...
- correct answer Unexpected increases in the cost of utilities
Accounting: What budget allows for adjustments in activity levels? - correct answer
Flexible budget
Accounting: A budget that summarizes future plans for the acquisition of fixed assets is
the... - correct answer Capital expenditures budget
Accounting: What are the standard framework of guidelines for financial accounting
used in any given jurisdiction, also known as accounting standards?? - correct answer
GAAP
Economics: What occurs when the price level rises? - correct answer People need to
hold more money, so interest rates rise, making firms borrow and invest less
Economics: The federal government enacted regulation in the 1960's requiring people
to wear seatbelt in their cars. All of the following resulted from this regulation, EXCEPT:
- correct answer Fewer pedestrians were killed in car accidents.
