MBA 620 Midterm Exam Study Guide
ACTUAL QUESTIONS AND CORRECT
ANSWERS
Revenues - CORRECT ANSWERS Sales of goods or services to
customers
Revenue Recognition Principle - CORRECT ANSWERS Revenues are
recorded at sale, whether or not cash is received
Expenses - CORRECT ANSWERS The cost of doing business, including
labor, materials, advertising, and utilities
Matching Principle - CORRECT ANSWERS Expenses are recorded
when the products are sold
Assets - CORRECT ANSWERS Resources Owned by the company
Liabilities - CORRECT ANSWERS Resources Owed to creditors
Stockholders Equity - CORRECT ANSWERS Resources Left for
Owners
Double entry accounting - CORRECT ANSWERS What happens when
the company borrows $1,000? Assets (cash) increase by $1,000, Liabilities
(loan) increase by $1,000. This is called what?
Plan, Control - CORRECT ANSWERS Two important functions of
managers
, Planning Function - CORRECT ANSWERS Establishing and
communicating goals - Budgets, Balanced Scorecards, Performance incentives
Control Function - CORRECT ANSWERS Evaluating achievement of
goals - Variance analysis, Balanced Scorecards, Trend analysis
Ethical Issues in Accounting - CORRECT ANSWERS conflict of
interest, pressure to manipulate, sins of omission, confidentiality,
whistleblowing
2019 - CORRECT ANSWERS In what year should the sale of a product
for $1.2M be recorded if the contract is signed and the product is shipped on
January 3, 2019?
Fixed costs - CORRECT ANSWERS Do not change in response to a
change in volume activity; no change in total cost as activity increases or
decreases (slope is zero Y = f)
Mixed costs - CORRECT ANSWERS Contain both fixed and variable
cost elements (Y = f + vX); Y-intercept = f Slope = v
Variable costs - CORRECT ANSWERS Change in total in direct
proportion to changes in activity; total cost increases in direct proportion with
activity (Y = vX)
Discretionary costs - CORRECT ANSWERS Fixed Costs that can be
easily changed
Committed costs - CORRECT ANSWERS Fixed Costs that cannot be
easily changed in the short run
ACTUAL QUESTIONS AND CORRECT
ANSWERS
Revenues - CORRECT ANSWERS Sales of goods or services to
customers
Revenue Recognition Principle - CORRECT ANSWERS Revenues are
recorded at sale, whether or not cash is received
Expenses - CORRECT ANSWERS The cost of doing business, including
labor, materials, advertising, and utilities
Matching Principle - CORRECT ANSWERS Expenses are recorded
when the products are sold
Assets - CORRECT ANSWERS Resources Owned by the company
Liabilities - CORRECT ANSWERS Resources Owed to creditors
Stockholders Equity - CORRECT ANSWERS Resources Left for
Owners
Double entry accounting - CORRECT ANSWERS What happens when
the company borrows $1,000? Assets (cash) increase by $1,000, Liabilities
(loan) increase by $1,000. This is called what?
Plan, Control - CORRECT ANSWERS Two important functions of
managers
, Planning Function - CORRECT ANSWERS Establishing and
communicating goals - Budgets, Balanced Scorecards, Performance incentives
Control Function - CORRECT ANSWERS Evaluating achievement of
goals - Variance analysis, Balanced Scorecards, Trend analysis
Ethical Issues in Accounting - CORRECT ANSWERS conflict of
interest, pressure to manipulate, sins of omission, confidentiality,
whistleblowing
2019 - CORRECT ANSWERS In what year should the sale of a product
for $1.2M be recorded if the contract is signed and the product is shipped on
January 3, 2019?
Fixed costs - CORRECT ANSWERS Do not change in response to a
change in volume activity; no change in total cost as activity increases or
decreases (slope is zero Y = f)
Mixed costs - CORRECT ANSWERS Contain both fixed and variable
cost elements (Y = f + vX); Y-intercept = f Slope = v
Variable costs - CORRECT ANSWERS Change in total in direct
proportion to changes in activity; total cost increases in direct proportion with
activity (Y = vX)
Discretionary costs - CORRECT ANSWERS Fixed Costs that can be
easily changed
Committed costs - CORRECT ANSWERS Fixed Costs that cannot be
easily changed in the short run
