MBA 620 Final Exam Actual Exam 2026
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What are opportunity costs?
a. The net gain that is given up when choosing one option over another.
b. The revenues forgone when choosing one option over another.
c. The costs avoided when choosing one option over another.
d. The costs associated with one option (opportunity). ---------CORRECT
ANSWER-----------------a
One of the products ABC company manufactures is picture frames.
Which of the following costs would be relevant when deciding whether
to a make or buy (outsource) the glass part of the frame?
a. The direct material cost of the glass.
b. The cost of equipment bought last year to cut the glass to size.
c. Depreciation on the factory building.
d. The plant manager's salary. ---------CORRECT ANSWER-----------------a
,What do we call costs that could be eliminated with one course of
action, and are always relevant to a decision?
a. allocated fixed costs
b. sunk costs
c. avoidable costs
d. opportunity costs ---------CORRECT ANSWER-----------------c
What does it mean to 'capitalize and expense'?
a. To report the whole expense of a major investment in the time
period when it was purchased.
b. To report an expense in the capital expenditures account.
c. To spread a liability balance over a period of years.
d. To record the cost as an asset, then record a depreciation expense
over a period of years that accumulates to the purchase cost to offset
that asset balance. ---------CORRECT ANSWER-----------------d
What is the time value of money?
, a. The monetary value of a project's future net cash flows at time zero.
b. The monetary value of accountants' time spent on a project.
c. Funds received today are worth less than the same amount received
in the future because of depreciation.
d. Funds received today are worth more than the same amount
received in the future because those funds could be invested today and
earn interest in the interim. ---------CORRECT ANSWER-----------------d
Which of the following budgets needs to be established first in the
budgeting process?
a. The production budget
b. The cash budget
c. The budgeted income statement
d. The sales budget ---------CORRECT ANSWER-----------------d
A benefit of the participative approach to budgeting (relative to the
top-down approach) is:
a. In participative budgeting, lower level management has less input on
the budget.
| Complete Questions and Correct
Answers | Verified Answers | Just
Released
What are opportunity costs?
a. The net gain that is given up when choosing one option over another.
b. The revenues forgone when choosing one option over another.
c. The costs avoided when choosing one option over another.
d. The costs associated with one option (opportunity). ---------CORRECT
ANSWER-----------------a
One of the products ABC company manufactures is picture frames.
Which of the following costs would be relevant when deciding whether
to a make or buy (outsource) the glass part of the frame?
a. The direct material cost of the glass.
b. The cost of equipment bought last year to cut the glass to size.
c. Depreciation on the factory building.
d. The plant manager's salary. ---------CORRECT ANSWER-----------------a
,What do we call costs that could be eliminated with one course of
action, and are always relevant to a decision?
a. allocated fixed costs
b. sunk costs
c. avoidable costs
d. opportunity costs ---------CORRECT ANSWER-----------------c
What does it mean to 'capitalize and expense'?
a. To report the whole expense of a major investment in the time
period when it was purchased.
b. To report an expense in the capital expenditures account.
c. To spread a liability balance over a period of years.
d. To record the cost as an asset, then record a depreciation expense
over a period of years that accumulates to the purchase cost to offset
that asset balance. ---------CORRECT ANSWER-----------------d
What is the time value of money?
, a. The monetary value of a project's future net cash flows at time zero.
b. The monetary value of accountants' time spent on a project.
c. Funds received today are worth less than the same amount received
in the future because of depreciation.
d. Funds received today are worth more than the same amount
received in the future because those funds could be invested today and
earn interest in the interim. ---------CORRECT ANSWER-----------------d
Which of the following budgets needs to be established first in the
budgeting process?
a. The production budget
b. The cash budget
c. The budgeted income statement
d. The sales budget ---------CORRECT ANSWER-----------------d
A benefit of the participative approach to budgeting (relative to the
top-down approach) is:
a. In participative budgeting, lower level management has less input on
the budget.
