ACC 241 - Exam 3 CH 9, 10, 11
Question and answers already passed
2025/2026
Budgeting assists management in which of the following areas? - correct answer ✔-Motivation
-Planning and setting objectives
-Performance measurement
Which of the following is an advantage of the budgeting process? - correct answer ✔-Budgeting
provides a standard for performance evaluation
-Budgeting provides resource information for decision making
-Budgeting improves communication and coordination within the organization
When an organization involves its many employees in the budgeting process in a meaningful way, the
organization is said to be using: - correct answer ✔Participative budgeting
"Responsibility accounting" is the concept that says: - correct answer ✔Managers should be held
responsible for only those things under their control
The manager of a profit center should not be responsible for which of the following types of decisions? -
correct answer ✔Deciding whether or not their segment should purchase additional machinery
Which type of manager would most likely be held responsible for the return on investment (ROI) of his
segment? - correct answer ✔Investment center
A company has computed that their "margin" is .18. Which of the following statements is the best
interpretation of these results? - correct answer ✔$.18 of every $1 made in sales is profit
, A positive result that stems from the use of return on investment (ROI) is that it encourages managers to
focus on - correct answer ✔-The relationship among sales, expenses, and investment
-Operating asset efficiency
-The efficient use of resources in generating income
-Cost efficiency
Division A had ROI of 15% last year. The manager of Division A is considering an additional investment
for the coming year. What step will the manager likely choose to take? - correct answer ✔Reject the
investment if it returns less than 15% ROI
Which of the following is a disadvantage of a focus on return on investment? - correct answer ✔It can
produce a narrow focus on divisional profitability at the expense of profitability for the overall firm
If the ROI of a project is greater than the target rate of return, the residual income will be - correct
answer ✔Greater than zero
A favorable labor efficiency variance is created when: - correct answer ✔Actual hours worked are less
than the standard hours allowed.
Hayden Corp. has a $6,000 favorable flexible budget variance for January. If January's flexible budget net
income was $100,000, which of the following statements is true? - correct answer ✔Hayden's actual
net income must have been $106,000
Court Company has an unfavorable materials price variance. Which of the following would be the LEAST
likely reason for this variance? - correct answer ✔The company used more material than was budgeted
for in each unit
An unfavorable materials usage variance could result from - correct answer ✔Not efficiently utilizing
raw materials, thus causing waste
Question and answers already passed
2025/2026
Budgeting assists management in which of the following areas? - correct answer ✔-Motivation
-Planning and setting objectives
-Performance measurement
Which of the following is an advantage of the budgeting process? - correct answer ✔-Budgeting
provides a standard for performance evaluation
-Budgeting provides resource information for decision making
-Budgeting improves communication and coordination within the organization
When an organization involves its many employees in the budgeting process in a meaningful way, the
organization is said to be using: - correct answer ✔Participative budgeting
"Responsibility accounting" is the concept that says: - correct answer ✔Managers should be held
responsible for only those things under their control
The manager of a profit center should not be responsible for which of the following types of decisions? -
correct answer ✔Deciding whether or not their segment should purchase additional machinery
Which type of manager would most likely be held responsible for the return on investment (ROI) of his
segment? - correct answer ✔Investment center
A company has computed that their "margin" is .18. Which of the following statements is the best
interpretation of these results? - correct answer ✔$.18 of every $1 made in sales is profit
, A positive result that stems from the use of return on investment (ROI) is that it encourages managers to
focus on - correct answer ✔-The relationship among sales, expenses, and investment
-Operating asset efficiency
-The efficient use of resources in generating income
-Cost efficiency
Division A had ROI of 15% last year. The manager of Division A is considering an additional investment
for the coming year. What step will the manager likely choose to take? - correct answer ✔Reject the
investment if it returns less than 15% ROI
Which of the following is a disadvantage of a focus on return on investment? - correct answer ✔It can
produce a narrow focus on divisional profitability at the expense of profitability for the overall firm
If the ROI of a project is greater than the target rate of return, the residual income will be - correct
answer ✔Greater than zero
A favorable labor efficiency variance is created when: - correct answer ✔Actual hours worked are less
than the standard hours allowed.
Hayden Corp. has a $6,000 favorable flexible budget variance for January. If January's flexible budget net
income was $100,000, which of the following statements is true? - correct answer ✔Hayden's actual
net income must have been $106,000
Court Company has an unfavorable materials price variance. Which of the following would be the LEAST
likely reason for this variance? - correct answer ✔The company used more material than was budgeted
for in each unit
An unfavorable materials usage variance could result from - correct answer ✔Not efficiently utilizing
raw materials, thus causing waste
