Seminole State College

ACG - Module 24: Capital Budgeting Decisions. Questions and Answers. Rationales Provided Module 24: Capital Budgeting Decisions True/False Topic: Post-Audits LO: 1 1. A well run organization should perform an evaluation, called a post audit, of its investment projects before their completion. Answer: False Rationale: After completion of the project, the post-audit is conducted for comparison with project expectations. Topic: Post-Audits LO: 1 2. Post-audits create an incentive for...

ACG - Module 17: Product Costing: Job and Process Operations. Questions with Answers. Rationales Provided. Module 17: Product Costing: Job and Process Operations True/False Topic: Definition of Product Costing LO: 2 1. The process of assigning cost to inventories as they are converted from raw material to finished goods is called product costing. Answer: True Rationale: The textbook definition of the term “product costing” is: “all costs incurred in the manufacturing of products...

ACG - Module 16: Relevant Costs and Benefits for Decision Making. Questions and Answers. Rationales Provided. Module 16: Relevant Costs and Benefits for Decision Making True/False Topic: Relevant Costs LO: 1 1. Relevant costs are future costs that differ between competing decision alternatives. Answer: True Rationale: Definition Topic: Outlay Costs LO: 1 2. Outlay costs are costs that have been incurred in the past, such as the purchase of a new piece of equipment for an outlay cost...

ACG - Module 11: Forecasting Financial Statements. Questions and Answers. Rationales Provided. Module 11: Forecasting Financial Statements True/False Topic: Eliminating Transitory Activities LO: 1 1. To forecast future performance, we should first create a set of financial statements that reflects items we expect to persist. Answer: True Rationale: Persistent activities are those that will recur – that is the point of forecasting, to predict what will recur. Topic: Conservatism ver...

ACG - Module 14: Cost Behavior, Activity Analysis, and Cost Estimation. Questions and Answers. Rationales Provided. Module 14: Cost Behavior, Activity Analysis, and Cost Estimation True/False Topic: Cost Behavior Pattern LO: 1 1. Mixed cost behavior pattern is unrelated to unit activity level. Answer: False Rationale: The variable portion of a mixed cost is related to the unit activity level, because this portion of the mixed cost will increase as activity level increases. The fixed p...

ACG- Module 10: Reporting and Analyzing Off-Balance-Sheet Financing. Questions and Answers. Rationales Provided. Topic: Lease Capitalization LO: 1 2. Capitalizing leases have little effect on a company’s return on equity (ROE) ratio. Answer: True Rationale: ROE is largely unaffected since net income and stockholders’ equity are largely unaffected. However, capitalizing leases does affect the components of ROE such as FLEV and NOAT and RNOA. Topic: Leases as a Financing Source LO:...

ACG - Module 22: Standard Costs and Performance Reports. Questions and Answers. Module 22 Standard Costs and Performance Reports DISCUSSION QUESTIONS Q22-1. Responsibility accounting is the structuring of performance reports addressed to individual or group members of an organization in a manner that emphasizes the factors controllable by them. Noncontrollable costs should be excluded from performance reports because, if included, they would distract managers' attention from control...

ACG - Module 23: Segment Reporting, Transfer Pricing, and Balanced Scorecard. Questions and Answers. Segment Reporting, Transfer Pricing, and Balanced Scorecard DISCUSSION QUESTIONS Q23-1. Segment reports are income statements that show operating results for portions or segments of a business, while product reports are only for product lines of the business. Product reports are a type of segment reports. Q23-2. A reporting objective is an identified segment of a business that managemen...

ACG - Module 12: Analyzing and Valuing Equity Securities. Questions and Answers. Analyzing and Valuing Equity Securities DISCUSSION QUESTIONS Q12-1. Current and historical financial information are the primary sources of information for forecasting future financial performance. Analysts frequently eliminate transitory items from reported earnings to gain a clearer perspective of the expected future earnings of the company, that is, those earnings that are likely to persist into the futu...

ACG - Module 18: Activity-Based Costing, Customer Profitability, and Activity-Based Management. Questions and Answers. Rationales Provided. Module 18: Activity-Based Costing, Customer Profitability, and Activity-Based Management True/False Topic: Changing Cost Environment LO: 1 1. The twentieth century saw an accelerating shift from traditional manufacturing activities to production procedures requiring large investments in raw materials and labor. Answer: False Rationale: The shift ...