ETS BUSINESS EXAM STUDY GUIDE
EXAM QUESTIONS & DETAILED
ANSWERS RATED 100% COMPLETE
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: A cost that will not be affected by later decisions is termed an - correct answer
✔✔Sunk Cost
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: 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
EXAM QUESTIONS & DETAILED
ANSWERS RATED 100% COMPLETE
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: A cost that will not be affected by later decisions is termed an - correct answer
✔✔Sunk Cost
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: 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
