MBA 620 Midterm ACTUAL QUESTIONS AND CORRECT ANSWERS

MBA 620 Midterm Exam ACTUAL
QUESTIONS AND CORRECT ANSWERS
Sales of goods or services to customers - CORRECT ANSWERS
Revenues


Revenues are recorded at sale, whether or not cash is received - CORRECT
ANSWERS Revenue Recognition Principle


The cost of doing business, including labor, materials, advertising, and utilities -
CORRECT ANSWERS Expenses


Expenses are recorded when the products are sold - CORRECT ANSWERS
Matching Principle


Resources Owned by the company - CORRECT ANSWERS Assets


Resources Owed to creditors - CORRECT ANSWERS Liabilities


Resources Left for Owners - CORRECT ANSWERS Stockholders
Equity


What happens when the company borrows $1,000?


Assets (cash) ______ by $1,000
Liabilities (loan) _______ by $1,000 - CORRECT ANSWERS increase,
increase


What happens when the company borrows $1,000?

, Assets (cash) ______ by $1,000
Liabilities (loan) _______ by $1,000


What is this called? - CORRECT ANSWERS Double entry accounting


Two important functions of managers - CORRECT ANSWERS Plan,
Control


Establishing and communicating goals
- Budgets
- Balanced Scorecards
- Performance incentives - CORRECT ANSWERS Planning Function


Evaluating achievement of goals
- Variance analysis
- Balanced Scorecards
- Trend analysis - CORRECT ANSWERS Control Function


Ethical Issues in Accounting (5) - CORRECT ANSWERS conflict of
interest, pressure to manipulate, sins of omission, confidentiality,
whistleblowing


Revenue Recognition and Accounting Ethics:
- On December 29, 2018, a customer C agrees (verbally) to buy your product
for $1.2M
- The contract is signed and the product is shipped January 3, 2019