Chapter 11 Spreadsheet Modeling and Analysis Questions And Answers

Chapter 11 Spreadsheet Modeling and Analysis t t t t t


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Chapter 11 Spreadsheet Modeling and Analysis
Questions And Answers
1. Creating good decision models requires: - t t t t t


solid understanding of business functional areas
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- knowledge of business practice and research t t t t t


- logical skills t


2. Simple mathematics: "Back-of-the- t t


envelope"calculations canprovidethebasis for a more formal model
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3. Influence diagrams: an t t t


is a logical and visual representation of key model relationships
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4. Spreadsheet Engineering: Building spreadsheet models is part art and part sci t t t t t t t t t t


ence.
Spreadsheets need to be a t t t t


ccurate, understandable, t t


and user friendly.
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5. Verification: is the process of ensuring that a model is accu- t t t t t t t t t t


rate and free from logical errors.
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6. Gross Profit: = sales - cost of goods sold
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7. Operating Expenses: =administrativeex- t t t t


penses+ selling expenses+ depreciation expenses
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8. Net Operating income: t = gross profit t t t t


- operating expenses t


9. Earnings Before Taxes: = net operating income
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- interest expense t


10. Net Income: t = earnings before taxes - taxes t t t t t t


11. Validity: refers to how well a model represents reality. t t t t t t t t


12. Sources of Data: Subjective judgment E t t t t t


xisting databases t


Analysis of historical data t t t


Surveys, experiments, or other methods of data collection
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13. Form Controls: are buttons, boxes, and other mecha-
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nisms for inputting or changing data on spreadsheets easily that can be used to design
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user-friendly spreadsheets.
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14. Types of Form Controls: Button C t t t t t


ombo box t


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