ACC 241 ASU DALLMUS COMPREHENSIVE
EXAMINATION TEST 2026 COMPLETE
QUESTIONS AND VERIFIED SOLUTIONS
⩥ Cost Center. Answer: A cost center is a business unit that is only
responsible for the costs that it incurs. The manager of a cost center is
not responsible for revenue generation or asset usage. The performance
of a cost center is usually evaluated through the comparison of budgeted
to actual costs.
⩥ Cost of Goods Sold, Inventory and Purchases Budget. Answer: A
merchandiser's budget that computes the Cost of Goods Sold, the
amount of desired ending inventory, and amount of merchandise to be
purchased.
⩥ Financial Budgets. Answer: The budgets that project the collection
and payment of cash, as well as forecast the company's budgeted balance
sheet.
⩥ Investment Center. Answer: A business unit within an entity that has
responsibility for its own revenue, expenses, and assets. Management
evaluates the investment center based on its return on those assets
invested specifically in the investment center.
,⩥ Line of Credit. Answer: A commitment from a lender to pay a
company whenever it needs cash, up to a pre-set maximum level. It is
generally secured by company assets, and for that reason bears an
interest rate not far above the prime rate.
⩥ Management by Exception. Answer: The practice of examining the
financial and operational results of a business, and only bringing issues
to the attention of management if results represent substantial
differences from the budgeted or expected amount.
⩥ Master Budget. Answer: The comprehensive planning document for
the entire organization. The master budget includes the operating
budgets and the financial budgets.
⩥ Operating Budgets. Answer: The budgets needed to run the daily
operations of the company. The operation budgets culminate in a
budgeted income statement.
⩥ Participative Budget. Answer: A budgeting process under which those
people impacted by a budget are involved in the budget creation process.
This bottom-up approach to budgeting tends to create budgets that are
more achievable than are top-down budgets that are imposed on a
company by senior management
⩥ Profit Center. Answer: A business segment whose manager has
responsibility for both cost and revenue. Like a cost center, a profit
,center does not have responsibility for the assets it uses. Segmented
income statements
⩥ Responsibility Accounting. Answer: system of evaluating the
performance of each responsibility center and its manager.
⩥ Responsibility Center. Answer: Any part of an organization whose
manager has control over cost, revenue, or investment funds.
⩥ Revenue Center. Answer: Unit within an organization for which the
manager is only responsible for generating revenues.
⩥ Rolling Budget. Answer: A budget that is continuously updated so that
the next 12 months of operations are always budgeted; also known as a
continuous budget.
⩥ Safety Stock. Answer: An additional quantity of items held in
inventory in order to minimize the chance of an item being out of stock.
⩥ Sensitivity Analysis. Answer: A "What -if" technique that asks what
results will be if actual prices or costs change or if an underlying
assumption changes.
⩥ Slack. Answer: The intentional overstatement of budgeted expenses
and / or understatement of budgeted revenues in order to cope with
, uncertainty, make performance appear better, or make room for potential
budget cuts.
⩥ Strategic Planning. Answer: An organization's process of defining its
strategy, or direction, and making decisions on allocating its resources to
pursue this strategy. The planning time frame typically extends 5 - 10
years into the future.
⩥ Variance. Answer: The difference between actual and budgeted
amounts for revenues and expenses.
⩥ Zero-based Budgeting. Answer: A system of budgeting where each
department or division of a company must justify all expenditures and
allocations rather than simply increases over the previous fiscal year.
⩥ Balanced Scorecard. Answer: A strategic management system based
upon measuring key performance indicators across all aspects and areas
of an enterprise: financial; customer; internal process; and learning and
growth.
⩥ Benchmarking. Answer: Comparing actual performance to similar
companies in the same industry, to other divisions, or to world-class
standards.
EXAMINATION TEST 2026 COMPLETE
QUESTIONS AND VERIFIED SOLUTIONS
⩥ Cost Center. Answer: A cost center is a business unit that is only
responsible for the costs that it incurs. The manager of a cost center is
not responsible for revenue generation or asset usage. The performance
of a cost center is usually evaluated through the comparison of budgeted
to actual costs.
⩥ Cost of Goods Sold, Inventory and Purchases Budget. Answer: A
merchandiser's budget that computes the Cost of Goods Sold, the
amount of desired ending inventory, and amount of merchandise to be
purchased.
⩥ Financial Budgets. Answer: The budgets that project the collection
and payment of cash, as well as forecast the company's budgeted balance
sheet.
⩥ Investment Center. Answer: A business unit within an entity that has
responsibility for its own revenue, expenses, and assets. Management
evaluates the investment center based on its return on those assets
invested specifically in the investment center.
,⩥ Line of Credit. Answer: A commitment from a lender to pay a
company whenever it needs cash, up to a pre-set maximum level. It is
generally secured by company assets, and for that reason bears an
interest rate not far above the prime rate.
⩥ Management by Exception. Answer: The practice of examining the
financial and operational results of a business, and only bringing issues
to the attention of management if results represent substantial
differences from the budgeted or expected amount.
⩥ Master Budget. Answer: The comprehensive planning document for
the entire organization. The master budget includes the operating
budgets and the financial budgets.
⩥ Operating Budgets. Answer: The budgets needed to run the daily
operations of the company. The operation budgets culminate in a
budgeted income statement.
⩥ Participative Budget. Answer: A budgeting process under which those
people impacted by a budget are involved in the budget creation process.
This bottom-up approach to budgeting tends to create budgets that are
more achievable than are top-down budgets that are imposed on a
company by senior management
⩥ Profit Center. Answer: A business segment whose manager has
responsibility for both cost and revenue. Like a cost center, a profit
,center does not have responsibility for the assets it uses. Segmented
income statements
⩥ Responsibility Accounting. Answer: system of evaluating the
performance of each responsibility center and its manager.
⩥ Responsibility Center. Answer: Any part of an organization whose
manager has control over cost, revenue, or investment funds.
⩥ Revenue Center. Answer: Unit within an organization for which the
manager is only responsible for generating revenues.
⩥ Rolling Budget. Answer: A budget that is continuously updated so that
the next 12 months of operations are always budgeted; also known as a
continuous budget.
⩥ Safety Stock. Answer: An additional quantity of items held in
inventory in order to minimize the chance of an item being out of stock.
⩥ Sensitivity Analysis. Answer: A "What -if" technique that asks what
results will be if actual prices or costs change or if an underlying
assumption changes.
⩥ Slack. Answer: The intentional overstatement of budgeted expenses
and / or understatement of budgeted revenues in order to cope with
, uncertainty, make performance appear better, or make room for potential
budget cuts.
⩥ Strategic Planning. Answer: An organization's process of defining its
strategy, or direction, and making decisions on allocating its resources to
pursue this strategy. The planning time frame typically extends 5 - 10
years into the future.
⩥ Variance. Answer: The difference between actual and budgeted
amounts for revenues and expenses.
⩥ Zero-based Budgeting. Answer: A system of budgeting where each
department or division of a company must justify all expenditures and
allocations rather than simply increases over the previous fiscal year.
⩥ Balanced Scorecard. Answer: A strategic management system based
upon measuring key performance indicators across all aspects and areas
of an enterprise: financial; customer; internal process; and learning and
growth.
⩥ Benchmarking. Answer: Comparing actual performance to similar
companies in the same industry, to other divisions, or to world-class
standards.
