ACCT 6100 (Exam 1) Questions With Complete Solutions
Accounting costs Correct Answers ____ measure the monetary
resources expended for a particular activity
Adverse selection Correct Answers The tendency of individuals
with private information about something that benefits them to
make offers that are detrimental to the trading partner
Agency costs Correct Answers The decline in firm value that
results from agents pursuing their own interests to the detriment
of the principal's interest
Annuity Correct Answers A stream of equal cash flows for a
fixed number of years
Benchmarking Correct Answers A technique where a company
compares its performance against the best firms, determines how
those firms achieved their superior performance, and uses the
knowledge to improve their own performance.
Broad Correct Answers Should a firm's integral accounting
system be examined from a narrow or broad perspective?
Capital budgeting Correct Answers The analysis of investment
alternatives involving cash flows received or paid over time
Capital budgeting Correct Answers The making of long-term
decisions for investments in projects and infrastructure
, Cash flows Correct Answers In capital budgeting problems,
should you discount cash flows or earnings?
Compound interest Correct Answers _____ describes the
interest earned on the reinvested interest
Contribution margin Correct Answers the difference between
the price and the variable cost per copy.
Control Correct Answers Aligning the interests of employees
with maximizing the value of the firm.
Control system Correct Answers All of the mechanisms that
help align employee interests with maximizing the
organization's value, like performance measures, promotions,
demotions, termination, video cameras, internal auditors, etc.
cost driver Correct Answers the measure of physical activity
most highly associated with variations in cost
Cost vs benefits, different costs for different purposes,
behavioral and technical implications Correct Answers What
are the three decision rules to follow in accounting?
Decision control Correct Answers _____ refers to those aspects
of the decision process whereby managers either ratify or
monitor decisions
Decision making and control Correct Answers What are the two
purposes of internal accounting systems?
Accounting costs Correct Answers ____ measure the monetary
resources expended for a particular activity
Adverse selection Correct Answers The tendency of individuals
with private information about something that benefits them to
make offers that are detrimental to the trading partner
Agency costs Correct Answers The decline in firm value that
results from agents pursuing their own interests to the detriment
of the principal's interest
Annuity Correct Answers A stream of equal cash flows for a
fixed number of years
Benchmarking Correct Answers A technique where a company
compares its performance against the best firms, determines how
those firms achieved their superior performance, and uses the
knowledge to improve their own performance.
Broad Correct Answers Should a firm's integral accounting
system be examined from a narrow or broad perspective?
Capital budgeting Correct Answers The analysis of investment
alternatives involving cash flows received or paid over time
Capital budgeting Correct Answers The making of long-term
decisions for investments in projects and infrastructure
, Cash flows Correct Answers In capital budgeting problems,
should you discount cash flows or earnings?
Compound interest Correct Answers _____ describes the
interest earned on the reinvested interest
Contribution margin Correct Answers the difference between
the price and the variable cost per copy.
Control Correct Answers Aligning the interests of employees
with maximizing the value of the firm.
Control system Correct Answers All of the mechanisms that
help align employee interests with maximizing the
organization's value, like performance measures, promotions,
demotions, termination, video cameras, internal auditors, etc.
cost driver Correct Answers the measure of physical activity
most highly associated with variations in cost
Cost vs benefits, different costs for different purposes,
behavioral and technical implications Correct Answers What
are the three decision rules to follow in accounting?
Decision control Correct Answers _____ refers to those aspects
of the decision process whereby managers either ratify or
monitor decisions
Decision making and control Correct Answers What are the two
purposes of internal accounting systems?
