ETS Business Exam Study Guide
Correct Questions And Answers
Accounting: What costs should be considered when making non-routine decisions?
(3)Correct Answers The price of material, Factory overhead costs, and the price of labor
Accounting: Total product/ units produced and sold equals??Correct Answers Product
Cost per Unit
Accounting: What is a general explanation of what the contribution margin is?Correct
Answers The difference between variable costs subtracted from sales
Accounting: In a continuous budget plan how many months are generally planned?
Correct Answers 12 months
Accounting: Which of the following is not one of the weaknesses of standard
costingCorrect Answers 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 Answers 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 Answers Cash flow statement
The net cash flow from operating activities normally differs from the amount of net
income for the period.Correct Answers True
Accounting: Expense accounts would have a balance on which side?Correct Answers
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 Answers Corporation
Accounting: A debt may slightlyCorrect Answers Increase in an asset account
Accounting: What would be classified as a current asset on the balance sheetCorrect
Answers Accounts receivable
Accounting: What are the elements of internal control? (3)Correct Answers 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 Answers True
Accounting: Factors in computing depreciation are?Correct Answers 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 Answers 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 Answers True
Accounting: The excess of current assets of a business over its current liabilities is
called?Correct Answers Working capital
Accounting: What 2 categories are considered under period costs?Correct Answers
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 Answers Quantity factor
Accounting: A cost that will not be affected by later decisions is termed anCorrect
Answers Sunk Cost
Accounting: The unfavorable volume variance may be due to all but the following
facts...Correct Answers Unexpected increases in the cost of utilities
Accounting: What budget allows for adjustments in activity levels?Correct Answers
Flexible budget
Accounting: A budget that summarizes future plans for the acquisition of fixed assets is
the...Correct Answers 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 Answers
GAAP
Economics: What occurs when the price level rises?Correct Answers People need to
hold more money, so interest rates rise, making firms borrow and invest less
Correct Questions And Answers
Accounting: What costs should be considered when making non-routine decisions?
(3)Correct Answers The price of material, Factory overhead costs, and the price of labor
Accounting: Total product/ units produced and sold equals??Correct Answers Product
Cost per Unit
Accounting: What is a general explanation of what the contribution margin is?Correct
Answers The difference between variable costs subtracted from sales
Accounting: In a continuous budget plan how many months are generally planned?
Correct Answers 12 months
Accounting: Which of the following is not one of the weaknesses of standard
costingCorrect Answers 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 Answers 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 Answers Cash flow statement
The net cash flow from operating activities normally differs from the amount of net
income for the period.Correct Answers True
Accounting: Expense accounts would have a balance on which side?Correct Answers
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 Answers Corporation
Accounting: A debt may slightlyCorrect Answers Increase in an asset account
Accounting: What would be classified as a current asset on the balance sheetCorrect
Answers Accounts receivable
Accounting: What are the elements of internal control? (3)Correct Answers 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 Answers True
Accounting: Factors in computing depreciation are?Correct Answers 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 Answers 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 Answers True
Accounting: The excess of current assets of a business over its current liabilities is
called?Correct Answers Working capital
Accounting: What 2 categories are considered under period costs?Correct Answers
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 Answers Quantity factor
Accounting: A cost that will not be affected by later decisions is termed anCorrect
Answers Sunk Cost
Accounting: The unfavorable volume variance may be due to all but the following
facts...Correct Answers Unexpected increases in the cost of utilities
Accounting: What budget allows for adjustments in activity levels?Correct Answers
Flexible budget
Accounting: A budget that summarizes future plans for the acquisition of fixed assets is
the...Correct Answers 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 Answers
GAAP
Economics: What occurs when the price level rises?Correct Answers People need to
hold more money, so interest rates rise, making firms borrow and invest less
