8.

The receiving report is used to

a. accompany physical inventories to the
MULTIPLE CHOICES storeroom
1. The purpose of the purchase requisition is to or warehouse
a. order goods from vendors b. advise the purchasing department of the
b. record receipt of goods from vendors dollar
c. authorize the purchasing department to value of the goods delivered
order c. advise general ledger of the accounting entry
goods to
d. bill for goods delivered be made
2. The purpose of the receiving report is to d. advise the vendor that the goods arrived
a. order goods from vendors safely
b. record receipt of goods from vendors 9. When a copy of the receiving report arrives
c. authorize the purchasing department to in the
order purchasing department, it is used to
goods a. adjust perpetual inventory records
d. bill for goods delivered b. record the physical transfer of inventory
3. All of the following departments have a copy from
of the receiving to the warehouse
purchase order except c. analyze the receiving department’s process
a. the purchasing department d. recognize the purchase order as closed
b. the receiving department 10. The financial value of a purchase is
c. accounts payable determined by
d. general ledger reviewing the
4. The purpose of the purchase order is to a. packing slip
a. order goods from vendors b. purchase requisition
b. record receipt of goods from vendors c. receiving report
c. authorize the purchasing department to d. supplier’s invoice
order 11. Which document is least important in
goods determining
d. approve payment for goods received the financial value of a purchase?
5. The open purchase order file in the a. purchase requisition
purchasing b. purchase order
department is used to determine c. receiving report
a. the quality of items a vendor ships d. supplier’s invoice
b. the best vendor for a specific item 12. In a merchandising firm, authorization for
c. the orders that have not been received the
d. the quantity of items received payment of inventory is the responsibility of
6. The purchase order a. inventory control
a. is the source document to make an entry b. purchasing
into the c. accounts payable
accounting records d. cash disbursements
b. indicates item description, quantity, and 13. In a merchandising firm, authorization for
price the
c. is prepared by the inventory control purchase of inventory is the responsibility of
department a. inventory control
d. is approved by the end-user department b. purchasing
7. The reason that a blind copy of the purchase c. accounts payable
order is d. cash disbursements
sent to receiving is to
a. inform receiving when a shipment is due 14. When purchasing inventory, which
b. force a count of the items delivered document usually
c. inform receiving of the type, quantity, and triggers the recording of a liability?
price a. purchase requisition
of items to be delivered b. purchase order
d. require that the goods delivered are c. receiving report
inspected d. supplier’s invoice
15. Because of time delays between receiving a. reviews the supporting documents for
inventory completeness and accuracy
and making the journal entry b. prepares checks
a. liabilities are usually understated c. signs checks
b. liabilities are usually overstated d. marks the supporting documents paid
c. liabilities are usually correctly stated 22. When a cash disbursement in payment of
d. none of the above an
16. Usually the open voucher payable file is accounts payable is recorded
organized a. the liability account is increased
by b. the income statement is changed
a. vendor c. the cash account is unchanged
b. payment due date d. the liability account is decreased
c. purchase order number 23. Authorization for payment of an accounts
d. transaction date payable
17. Which of the following statements is not liability is the responsibility of
correct? a. inventory control
a. the voucher system is used to improve b. purchasing
control c. accounts payable
over cash disbursements d. cash disbursements
b. the sum of the paid vouchers represents the 24. Of the following duties, it is most important
voucher payable liability of the firm to
c. the voucher system permits the firm to separate
consolidate payments of several invoices on a. warehouse from stores
one b. warehouse from inventory control
voucher c. accounts payable and accounts receivable
d. many firms replace accounts payable with a d. purchasing and accounts receivable
voucher payable system 25. In a firm with proper segregation of duties,
18. In the expenditure cycle, general ledger adequate
does not supervision is most critical in
a. post the journal voucher from the accounts a. purchasing
payable department b. receiving
b. post the account summary from inventory c. accounts payable
control d. general ledger
c. post the journal voucher from the purchasing 26. The receiving department is not responsible
department to
d. reconcile the inventory control account with a. inspect shipments received
the b. count items received from vendors
inventory subsidiary summary c. order goods from vendors
19. The documents in a voucher packet include d. safeguard goods until they are transferred to
all of the the
following except warehouse
a. a check
b. a purchase order 27. The major risk exposures associated with
c. a receiving report the
d. a supplier’s invoice receiving department include all of the
20. To maintain a good credit rating and to following except
optimize a. goods are accepted without a physical count
cash management, cash disbursements should b. there is no inspection for goods damaged in
arrive at shipment
the vendor’s place of business c. inventories are not secured on the receiving
a. as soon as possible dock
b. on the due date d. the audit trail is destroyed
c. on the discount date 28. When searching for unrecorded liabilities at
d. by the end of the month the end
21. The cash disbursement clerk performs all of of an accounting period, the accountant would
the search all
following tasks except of the files except
a. the purchase requisition file d. one of the above
b. the cash receipts file 34. Goods received are inspected and counted
c. the purchase order file to
d. the receiving report file a. determine that the goods are in good
29. In regards to the accounts payable condition
department, which b. determine the quantity of goods received
statement is not true? c. preclude payment for goods not received or
a. the purchase requisition shows that the received in poor condition
transaction was authorized d. all of the above
b. the purchase order proves that the purchase 35. If a company uses a standard cost system,
was required inventory
c. the receiving report provides evidence of the records can be updated from the
physical receipt of the goods a. vendor invoice
d. the supplier’s invoice indicates the financial b. purchase order
value of the transaction c. receiving report
30. In a computerized system that uses an d. purchase requisition
economic 36. If a company uses an actual cost system,
order quantity (EOQ) model and the perpetual inventory
inventory records can first be updated from the
method, who determines when to reorder a. vendor invoice
inventory? b. purchase order
a. the inventory control clerk c. receiving report
b. the purchasing department d. purchase requisition
c. the vendor 37. Copies of a purchase order are sent to all of
d. the computer system the
31. Firms can expect that proper use of a valid following except
vendor a. inventory control
file will result in all of the following benefits b. receiving
except c. general ledger
a. purchasing agents will be discouraged from d. accounts payable
improperly ordering inventory from related 38. The receiving report
parties a. is used to update the actual cost inventory
b. purchases from fictitious vendors will be ledger
detected b. accompanies the goods to the storeroom
c. the most competitive price will be obtained c. is sent to general ledger
d. the risk of purchasing agents receiving d. is returned to the vendor to acknowledge
kickbacks and bribes will be reduced receipt
32. In a real-time processing system with a high of the goods
number
of transactions, the best and most practical 39. A supplier invoice
control over a. is included with the goods
cash disbursements is to have b. shows what was ordered even if all was not
a. all checks manually signed by the treasurer shipped
b. all checks signed by check-signing c. is sent by vendor to accounts payable
equipment d. none of the above
c. checks over a certain dollar amount 40. The cash disbursement function is
manually a. part of accounts payable
signed by the treasurer b. an independent accounting function
d. checks over a certain dollar amount c. a treasury function
manually d. part of the general ledger department
signed by the cash disbursements clerk GROUP 5 QUIZ: THE EXPENDITURE CYCLE PART
33. The document which will close the open I
purchase 13. It contributes to both control and efficiency
requisition file is the by
a. purchase order listing only those vendors approved to do
b. vendor invoice business
c. receiving report with the organization.
a. Voucher System number, and the unit standard cost.
b. Valid Vendor File a. Open and Close Requisition File
c. Blind Copy of the Purchase Order b. Inventory Master Fil
d. Receiving Report c. Vendor File
14. These procedures include the tasks d. Open and Purchase Order File
involved in 17. It processes the payment of obligations
identifying inventory needs, placing the order, created in
receiving the inventory and recognizing the the purchases system.
liability. a. Cash Disbursement System
a. Cash Disbursement System b. Cash Receipt System
b. Sales Forecasting c. Purchases Procedure
c. Financial Reporting d. Sales Reporting
d. Purchases Processing Procedures 18. This function continually monitors inventory
15. Which document helps to ensure that the levels.
receiving As inventory levels drop to their predetermined
clerks actually count the number of goods reorder points, it formally authorizes
received? replenishment
a. Packing List with a purchase requisition.
b. Blind Copy of Purchase Order a. Inventory Control
c. Shipping Notice b. Purchase Orders
d. Invoice c. Purchases Subsystem
16. The reconciliation of this document with the d. Supervision
PO 19. The reengineered system addresses many
signifies that the organization has a legitimate of the
obligation. operational weaknesses associated with the
a. Invoices automated system except:
b. Purchase Orders a. It uses real-time procedures and direct
c. Purchase Requisitions access
d. Receiving Reports files to shorten the lag time in record keeping
17. This document should reconcile with the b. It eliminates routine clerical procedures by
purchase distributing terminals to user areas
requisition. c. This system removes the physical separation
a. Invoices between authorization and transaction
b. Purchase Orders processing
c. Checks d. It achieves a significant reduction in paper
d. Receiving Reports documents by using digital communications
18. In this department a multipart purchase between departments and by digitally storing
order is records.
prepared to be sent to the vendor, AP,
receiving, 20. The automated system of expenditure cycle
data processing, and purchasing department promotes effective cash management by
file. scanning
a. Data Processing Department the voucher file daily for items due, thus
b. Receiving Department avoiding
c. Purchasing Departmen early payments and missed due dates.
d. Accounts Payable Department a. True
19. After receiving the purchase order in data b. False
processing 21. The blind copy contains no
department, an open purchase order file will be __________________
created and the open purchase requisition file information about the products being received.
will be a. Quantity or Price
transferred to close purchase requisition file. b. Quantity and Price
a. True c. Price or PO Number
b. False d. Price and Terms
16. This file contains purchase requisition 22. Upon recording the liability, the AP clerk
number, transfers
inventory number, quantity on order, vendor all source documents to the open AP file. These
source documents include the following except: price
a. Purchase Order c. is prepared by the inventory control
b. Receiving Report department
c. Disbursement Voucher d. is approved by the end-user department
d. Invoice 7. The reason that a blind copy of the purchase
23. This states that there must be a control of order is
access to sent to receiving is to
physical assets. Controls might include locks, a. inform receiving when a shipment is due
alarms, and restricted access to areas that b. force a count of the items delivered
contain c. inform receiving of the type, quantity, and
inventories and cash. price of items to be delivered
a. Theft of Assets d. require that the goods delivered are
b. Indirect Access inspected
c. Direct Access 8. The receiving report is used to
d. Supervision a. accompany physical inventories to the
Group 5 storeroom or warehouse
1. This should travel with the goods to describe b. advise the purchasing department of the
its dollar value of the goods delivered
contents. c. advise general ledger of the accounting entry
a. order goods from vendors to be made
b. record receipt of goods from vendors d. advise the vendor that the goods arrived
c. authorize the purchasing department to safely
order 9. When a copy of the receiving report arrives
goods in the
d. bill for goods delivered purchasing department, it is used to
2. The purpose of the receiving report is to a. accompany physical inventories to the
a. order goods from vendors storeroom or warehouse
b. record receipt of goods from vendors b. advise the purchasing department of the
c. authorize the purchasing department to dollar value of the goods delivered
order c. advise general ledger of the accounting entry
goods to be made
d. bill for goods delivered d. recognize the purchase order as closed
3. All of the following departments have a copy 10. The financial value of a purchase is
of the determined by
purchase order except reviewing the
a. order goods from vendors a. Packing slip
b. the receiving department
c. accounts payable b. purchase requisition
d. general ledger c. receiving report
4. The purpose of the purchase order is to d. supplier’s invoice
a. order goods from vendors 11. Which document is least important in
b. record receipt of goods from vendors determining
c. authorize the purchasing department to the financial value of a purchase?
order a. purchase requisition
goods b. purchase order
d. approve payment for goods received c. receiving report
5. The open purchase order file in the d. supplier’s invoice
purchasing 12. In a merchandising firm, authorization for
department is used to determine the
a. the quality of items a vendor ships payment of inventory is the responsibility of
b. the best vendor for a specific item a. inventory control
c. the orders that have not been received b. purchasing
d. the quantity of items received c. accounts payable
6. The purchase order d. cash disbursements
a. is the source document to make an entry into 13. Because of time delays between receiving
the accounting records inventory
b. indicates item description, quantity, and and making the journal entry
a. liabilities are usually understated a. Supervisors verify the accuracy of employee
b. liabilities are usually overstated time
c. liabilities are usually correctly stated cards.
d. none of the above b. Paychecks are distributed by an independent
14. Which of the following statements is not paymaster.
correct? c. Accounts payable verifies the accuracy of the
a. the voucher system is used to improve payroll register before transferring payroll
control over cash disbursements funds to the general checking accounting.
b. the sum of the paid vouchers represents the d. General ledger reconciles the labor
voucher payable liability of the firm distribution
c. the voucher system permits the firm to summary and the payroll disbursement
consolidate payments of several invoices on voucher.
one voucher 4. Which transaction is not processed in the
d. many firms replace accounts payable with a Fixed Asset
voucher payable systems System?
15. When a cash disbursement in payment of a. purchase of building
an b. improvement of equipment
accounts payable is recorded c. purchase of raw materials
a. the liability account is increased d. sale of company van
b. the income statement is changed 5. Depreciation
c. the cash account is unchanged a. is calculated by the department that uses
d. the liability account is decreased the fixed
asset
CHAPTER 6 — THE EXPENDITURE CYCLE b. allocates the cost of the asset over its useful
PART II life
MULTIPLE CHOICES c. is recorded weekly
1. The document that captures the total d. results in book value approximating fair
amount of time market
that individual workers spend on each value
production 6. Depreciation records include all of the
job is called a following
a. time card information about fixed assets except
b. job ticket a. the economic benefit of purchasing the asset
c. personnel action form b. the cost of the asset
d. labor distribution form c. the depreciation method being used
2. An important reconciliation in the payroll d. the location of the asset
system is 7. Which control is not a part of the Fixed Asset
a. general ledger compares the labor System?
distribution a. formal analysis of the purchase request
summary from cost accounting to the b. review of the assumptions used in the capital
disbursement voucher from accounts payable budgeting model
b. personnel compares the number of c. development of an economic order quantity
employees model
authorized to receive a paycheck to the d. estimates of anticipated cost savings
number of paychecks prepared 8. Objectives of the Fixed Asset System do not
c. production compares the number of hours include
reported a. authorizing the acquisition of fixed assets
on job tickets to the number of hours b. recording depreciation expense
reported on time cards c. computing gain and/or loss on disposal of
d. payroll compares the labor distribution fixed
summary to assets
the hours reported on time cards d. maintaining a record of the fair market value
3. Which internal control is not an important of
part of the all fixed assets
payroll system? 9. Which of the following is not a characteristic
of the
Fixed Asset System?
a. Acquisitions are routine transactions changes in pay rates for employees?
requiring a. payroll
general authorization. b. treasurer
b. Retirements are reported on an authorized c. personnel
disposal report form. d. cash disbursements
c. Acquisition cost is allocated over the 15. Which of the following situations represents
expected a
life of the asset. serious control weakness?
d. Transfer of fixed assets among departments a. Timekeeping is independent of the payroll
is department.
recorded in the fixed asset subsidiary ledger. b. Paychecks are distributed by the employees
10. In the payroll subsystem, which function immediate supervisor.
should c. Time cards are reconciled with job tickets.
distribute paychecks? d. Personnel is responsible for updating
a. personnel employee
b. timekeeping records, including creation of records for
c. paymaster new hires.
d. payroll 16. Why would an organization require the
11. Where does the responsibility lie for paymaster to
reconciling the deliver all unclaimed paychecks to the internal
labor distribution summary and the payroll audit department?
disbursement voucher? a. to detect a “phantom employee” for whom a
a. cash disbursements check was produced
b. cost accounting b. to prevent an absent employee’s check from
c. personnel being lost
d. general ledger c. to avoid paying absent employees for payday
12. Which of the following statements is not d. to prevent the paymaster from cashing
true? unclaimed checks
a. Routine payroll processing begins with the 17. Which of the following is not a reasonable
submission of time cards. control
b. Payroll clerks must verify the hours reported for fixed assets?
on a. Proper authorization is required for
the time cards. acquisition
c. Payroll reconciles personnel action forms and disposal of fixed assets.
with b. Fixed asset records show the location of
time cards and prepares paychecks. each
d. Cash disbursements signs paychecks and asset.
forwards them to the paymaster for c. Fully depreciated assets are immediately
distribution. disposed of.
d. Depreciation policies are in writing.
13. In a manufacturing firm, employees use 18. Cost accounting updates work-in-process
time cards accounts
and job tickets. Which of the following from
statements a. time cards
is not correct? b. the labor distribution summary
a. Job tickets are prepared by employees for c. job tickets
each d. personnel action forms
job worked on, so an employee may have 19. Payroll uses time card data to do all of the
more that one job ticket on a given day. following
b. An individual employee will have only one except
time card. a. prepare the payroll register
c. The time reported on job tickets should b. update employee payroll records
reconcile with the time reported on time cards. c. prepare the labor distribution summary
d. Paychecks should be prepared from the job d. prepare paychecks
tickets. 20. Payroll checks are typically drawn on
14. Which department is responsible for a. the regular checking account
approving b. a payroll imprest account
c. a wages payable account b. purchase of raw materials
d. petty cash c. repair of production equipment
21. The personnel action form provides d. purchase of a new plant
authorization 29. The Fixed Asset System performs all of the
control by following except
a. preventing paychecks for terminated a. determines the need for new assets
employees b. maintains depreciation records
b. verifying pay rates for employees c. records retirement and disposal of assets
c. informing payroll of new hires d. tracks the physical location of fixed assets
d. all of the above 30. The payroll department performs all of the
22. Accounting records that provide the audit following
trail for except
payroll include all of the following except a. prepares paychecks
a. time cards b. transfers adequate funds to the payroll
b. job tickets imprest
c. payroll register account
d. accounts payable register c. updates employee payroll records
23. Personnel actions forms are used to do all d. prepares the payroll register
of the 31. Depreciation
following except a. assures that assets are reported at fair
a. activate new employees market
b. terminate employees value
c. record hours worked b. is discretionary for many firms
d. change pay rates c. allocates the cost of an asset over its useful
24. The payroll department performs all of the life
following d. is the responsibility of the department using
except the
a. prepares the payroll register asset
b. distributes paychecks 32. The Fixed Asset System is similar to the
c. updates employee payroll records expenditure
d. prepares paychecks cycle except
25. The document that records the total a. fixed asset transactions are non-routine and
amount of time require special authorization and controls
spent on a production job is the b. fixed assets are capitalized, not expensed
a. time card c. both a and b
b. job ticket d. none of the above
c. labor distribution summary 33. Asset maintenance involves
d. personnel action form a. the recording of periodic depreciation
b. adjusting the asset records to reflect the cost
26. A control technique that can reduce the risk of
of a physical improvements
terminated employee being paid is c. keeping track of the physical location of the
a. a security camera viewing the time clock assets
b. the supervisor taking role during the shift d. all of the above
c. paychecks being distributed by an 34. The Fixed Asset Systems does all of the
independent following
paymaster except
d. reconciliation of time cards and job tickets a. records acquisition of assets
27. Accounts payable b. records improvements to assets
a. signs paychecks c. estimates the fair market value of assets in
b. prepares the payroll voucher service
c. reconciles time cards and employee records d. records the disposal of assets
d. distributes paychecks to employees 35. Asset disposal
28. All of the following are processed by the a. occurs as soon as an asset is fully
Fixed Asset depreciated
System except b. requires no special authorization
a. sale of unneeded equipment c. automatically initiates the purchase of a
replacement asset function
d. must follow formal authorization procedures d. Fixed asset system processes routine
GROUP 6 QUIZ: THE EXPENDITURE CYCLE PART transactions
1. It captures the time that individual workers 8. This file contains purchase requisition
spend on number,
each production job. inventory number, quantity on order, vendor
a. Personnel Action Form number, and the unit standard cost.
b. Job Tickets a. Review the asset acquisition and approval
c. Time Cards procedures to determine the reasonableness
d. Payroll Record of factors used in the analysis
2. It captures the time the employee is at work. b. Verify the location, condition, and fair value
a. Personnel Action Form of the organization’s fixed assets against the
b. Job Tickets fixed asset records in the subsidiary ledger
c. Time Cards c. Authorizes the fixed asset department to
d. Payroll Record remove from the ledger an asset disposed of
3. Its function is to prepare a single check for by the user department
the entire d. Reviewing and verifying the accuracy and
amount of the payroll and deposits it in the completeness of the depreciation charges
payroll calculated by the fixed asset system
imprest account.
a. Cash Disbursement Department 1. It is a record prepared by the production
b. Cost Accounting Department employees to account for the time that
c. Accounts Payable Department individual workers spend on each production
d. Production Department job.
4. The department that prepares copies of cash a. Time record
disbursement voucher is. b. Job ticket
a. Cash Disbursement Department c. Time card
b. Cost Accounting Department d. Job record
c. Accounts Payable Department 2. Which of the following is not a use of
5. The following are examples of payroll control personnel
except: action forms?
a. Access Control a. To eliminate employees
b. Segregation of Duty b. To change the pay rate of employees
c. Dependent Verification c. To account for the total time worked
d. Supervision each pay period for payroll calculation
6. The following are the objectives of fixed d. To activate new employees
asset 3. Which department prepares a cash
system except: disbursements voucher for the total amount of
a. Maintain adequate accounting records of the payroll?
asset acquisition, cost, description, and a. Payroll department
physical location in the organization b. Accounts payable department
b. Maintain accurate depreciation records for c. Cash disbursements department
depreciable assets in accordance with d. Production department
acceptable methods 4. The audit trail for payroll includes the
c. It is involved in the process of asset following
acquisition, asset maintenance documents, except:
d. Provide management with information to a. Personnel action forms
help plan for future fixed asset investments b. General ledger accounts
7. Which of the following statements is true? c. Time cards, job tickets, and
a. In the task of acquiring the asset, the disbursement vouchers
receiving department delivers the acquired d. Subsidiary ledger accounts
asset to the central store or to the warehouse. 5. The _____________ department makes
b. Conceptual-based fixed asset system changes
demonstrates real time processing to the employee file in real time via terminals.
c. In fixed asset acquisition, the fixed asset These changes include additions of new
department performs the record keeping employees, deletions of terminated employees,
changes in dependents, changes in by adding a record to the journal
withholding, voucher file
and changes in job status (pay rate) e. All of the above
a. Human Resource Management (HRM) 10. The _________ formally authorizes the fixed
system asset department to remove from the ledger an
b. Personnel asset disposed of by the user department.
c. Cost Accounting a. Disposal report
d. Time-Keeping b. Assessment Report
6. The ______________ department enters job c. Information Report
cost d. Acquisition Report
data (real time or daily) to create the labor 11. Controlling the fixed asset system includes
usage which of the following
file. a. Authorization Controls
a. Human Resource Management (HRM) b. Supervision Controls
system c. Independent Verification Controls
b. Personnel d. All of the above
c. Cost Accounting 12. These are relatively permanent items that
d. Time-Keeping often
7. Upon receipt of the approved time cards collectively represent the largest financial
from investment by the organization.
the supervisor at the end of the week, the a. Intangible assets
_____________ department creates the current b. Fixed assets
attendance file c. Current assets
a. Human Resource Management (HRM) d. Biological assets
system 13. This usually begins with the departmental
b. Personnel manager (user) recognizing the need to obtain
c. Cost Accounting a
d. Time-Keeping new asset or replace an existing one.
8. For moderate-sized and large organizations, a. Asset requisition
payroll processing is often integrated within the b. Asset disposal
_________________________. It captures and c. Asset management
processes a wide range of personnel related d. Asset acquisition
data, 14. This process involves adjusting the fixed
including employee benefits, labor resource asset
planning, employee relations, employee skills, subsidiary balances as the assets (excluding
and personnel actions (pay rates, deductions, land) depreciate over time or with usage.
and
so on), as well as payroll. a. Asset maintenance
a. Human Resource Management (HRM) b. Asset acquisition
system c. Asset management
b. Personnel d. Asset disposal
c. Cost Accounting 15. It begins when the responsible manager
d. Time-Keeping issues a
9. The fixed asset system uses the depreciation request to dispose of the asset
schedules to record end-of-period depreciation a. Asset acquisition
transactions automatically. The specific tasks b. Asset inventory
includes which of the following c. Asset disposal
a. Calculating the current period’s d. Asset maintenance
depreciation, CHAPTER 7 — THE CONVERSION CYCLE
b. Updating the accumulated depreciation
and book value fields in the subsidiary 1. Which item does not describe a world-class
records, company?
c. Posting the total amount of depreciation a. the goal of a world-class company is to
to the affected general ledger accounts delight its
(depreciation expense and accumulated customers
depreciation), and b. customers in a world-class company are
d. Recording the depreciation transaction external
departments only 8. The production schedule is
c. world-class companies work in cross- a. the expected demand for the firm’s finished
functional goods for a given year
teams b. the formal plan and authority to begin
d. a world-class company has a flat production
organizational c. a description of the type and quantity of raw
structure materials and subassemblies used to produce a
2. Which subsystem is not a part of the single unit of finished product
production d. the sequence of operations during
system? manufacturing
a. directing the movement of work through the 9. A move ticket
process a. is the formal plan and authority to begin
b. determining raw material requirements production
c. authorizing work to be performed b. specifies the materials and production
d. monitoring the flow of cost information required
related to for each batch
production c. records the work done in each work center
3. The purpose of the cost accounting system is d. authorizes the storekeeper to release
to materials to
a. produce information for inventory valuation work centers
b. authorize release of raw materials 10. The internal control significance of the
c. direct the movement of work-in-process excess
d. determine material requirements materials requisition is that it
4. Which process creates a homogeneous a. indicates the amount of material released to
product work
through a continuous series of standard centers
procedures? b. identifies materials used in production that
a. batch process exceed the standard amount allowed
b. make-to-order process c. indicates the standard quantities required for
c. continuous process production
d. none of the above d. documents the return to raw materials
5. An example of a continuous process is the inventory
production of unused production materials
of 11. Inventory control performs all of the
a. wedding invitations following tasks
b. milk products except it
c. jet aircraft a. provides production planning and control
d. all of the above with
6. All of the following are characteristics of the inventory status report of finished goods
batch b. updates the raw material inventory records
processing except c. prepares a materials requisition for each
a. each item in the batch is similar production batch
b. batches are produced in accordance with d. records the completed production as an
detailed increase
customer specifications to finished goods inventory
c. batches are produced to replenish depleted 12. The storekeeper releases raw materials
inventory levels based on the
d. setting up and retooling is required for a. production schedule
different b. materials requisition
batches c. work order
7. When determining which items to produce, a d. bill of materials
firm 13. Which of the following is not an assumption
must know of the
a. last year’s production level Economic Order Quantity model?
b. raw material inventory levels a. demand for the product is known with
c. the standard cost of the item certainty
d. the sales forecast b. total cost per year of placing orders is fixed
c. lead time is known and is constant d. computer aided design
d. there are no quantity discounts 20. The SAP R/3 system provides pre-defined
14. Firms hold safety stock to compensate for modules
to support business processes in the all of the
a. mathematical weaknesses of the Economic following categories except
Order a. human resources
Quantity model b. business process support
b. variations in lead time or daily demand c. strategic
c. fluctuations in carrying costs d. financial
d. uncertainty in the estimation of ordering 21. Which situation violates the segregation of
costs functions
15. What is the economic order quantity if the control procedure?
annual a. production planning and control is located
demand is 10,000 units, set up cost of placing apart
each from the work centers
order is $3 and the holding cost per unit per b. inventory control maintains custody of
year is $2? inventory items
a. 174 c. cost accounting has custody of and makes
b. 123 entries on cost records
c. 245 d. work centers record direct labor on job
d. none of the above tickets
16. If the daily demand is 40 units and the lead 22. All of the following are internal control
time is procedures
12 days, the reorder point is that should be in place in the conversion cycle
a. 52 units except
b. 48 units a. calculation and analysis of direct material
c. 480 units and
d. none of the above direct labor variances
17. Which statement is not correct? b. retention of excess materials by work
a. general ledger creates a new cost record centers
upon c. physical count of inventory items on hand
receipt of a work order from production d. limited access to raw material and finished
planning and control goods inventories
b. cost accounting updates the cost record with 23. Process simplification focuses on
data a. using Computer Numerical Controlled
gathered from the materials requisition machines which stand alone within a
c. general ledger posts summary information traditional
about setting
the manufacturing process based on a b. completely automating the manufacturing
journal voucher prepared by cost accounting environment
d. cost accounting computes variances and c. reducing the complexity of the physical
applies manufacturing layout of the shop floor
overhead to individual cost records d. organizing the process into functional
18. Which of the following is not a category of departments
critical 24. A manufacturing process that is organized
success factors in most manufacturing into group
companies? technology cells utilizing no human labor is
a. product quality called
b. customer service a. islands of technology
c. revenue generation b. process simplification
d. resource management c. Computer Integrated Manufacturing
19. Computer integrated manufacturing groups d. traditional manufacturing
all of the 25. An example of automation of
following technologies except manufacturing design
a. robotics is
b. materials requirements planning a. Computer Aided Engineering
c. automated storage and retrieval systems b. Automated Storage and Retrieval Systems
c. Computer Numerical Control d. cost objects create a demand for activities
d. robotics 33. Firms are adopting Activity Based Costing
26. An example of automation of (ABC)
manufacturing because
planning is a. it facilitates the analysis of variances
a. Computer Aided Engineering b. it more accurately allocates costs to
b. Automated Storage and Retrieval Systems products
c. Materials Requirements Planning c. it recognizes the importance of direct labor
as
d. Computer Numerical Control a component of total manufacturing cost
27. Firms implement a Just-In-Time inventory d. the financial nature of the reports permits
approach comparisons to be made among different
to types of products
a. reduce investment in inventories 34. In traditional firms, information reporting
b. determine the optimum inventory level using a. provides financially oriented information
the EOQ model relating to operations
c. camouflage production problems b. presents detailed information about activities
d. ensure overproduction of inventory c. shows the allocation of costs first to activities
28. Characteristics of Just-In-Time and then to cost objects
manufacturing d. identifies nonessential activities
include all of the following except 35. Types of information provided by Activity
a. push manufacturing Based
b. zero defects Costing include
c. reduced setup time and small lot sizes a. a description of the single activity driver
d. reliable vendors used
29. The cost of poor quality includes all of the for overhead application
following b. the dollar value of the direct material usage
except variance
a. cost of rework c. identification of cost drivers
b. warranty claims d. details of the components of the single
c. scheduling delays overhead cost pool
d. proceeds from the sale of scrap 36. Which statement is not correct?
30. A flexible manufacturing system a. the benchmark approach compares key
a. creates bottlenecks in the process activities with similar activities in other firms
b. leads to an “us” versus “them” attitude b. critical success factors include product and
among process quality
workers c. the ABC model includes two perspectives: an
c. shortens the physical distance between allocation of cost perspective and a process
activities perspective
d. is organized along functional lines d. in world-class manufacturing firms, quality
31. Deficiencies of the traditional cost control activities at the end of the process are
accounting essential
information system include all of the following 37. All of the following are documents in batch
except process
a. an emphasis on financial performance production systems except
b. inaccurate cost allocations a. production schedule
c. an emphasis on standard costs b. route sheet
d. immediate feedback about deviations from c. materials requisition
the d. purchase order
norm 38. Transaction authorization occurs in a
32. Which statement is not correct? traditional
a. an activity driver is a means to measure the manufacturing environment in all of the
activity used by the cost object following
b. cost object describes the work performed in ways except
a a. production planning and control initiates
firm production with a work order
c. activities cause costs
b. movement of the work through the EOQ.
production a. 1,400 kilos
process follows the move ticket b. 1,500 kilos
c. the sales department modifies work orders to c. 1,600 kilos
match changes in demand d. 1,700 kilos
d. the materials requisition authorizes the 4. The first step in applying Activity-Based
storekeeper to release materials to the work Costing is …
centers a. Identifying the cost drivers
39. Manufacturing flexibility incorporates four b. Computing a cost rate per cost driver
characteristics. These include all of the c. Identifying the activities that consume
following except resources
d. Assigning the cost to products
a. high product quality 5. A type of security which protects the physical
b. high inventory levels records
c. automation of manufacturing processes and assets from damage or theft.
d. physical reorganization of production a. Administrative Security
facilities b. Physical Security
40. The stages of the automation continuum c. Technical Security
are (in d. Corporate Security
order) 6. Wonwoo Company has an annual demand of
a. traditional, computer-integrated 183,750
manufacturing, units, a per-unit order cost of ₱240, and a
islands of technology, process carrying cost
simplification per unit of ₱5. Using these values, calculate the
b. process simplification, traditional, islands of EOQ.
technology, computer-integrated a. 4,100 units
manufacturing b. 4,200 units
c. traditional, islands of technology, process c. 4,300 units
simplification, computer-integrated d. 4,400 units
manufacturing 7. Which of the following define/s or is/are
d. traditional, process simplification, related to
computerintegrated Product Family.
manufacturing, islands of a. A group of related goods produced by the
technology same
GROUP 7 QUIZ: THE CONVERSION CYCLE company under the same brand.
1. Which of the following is not a deficiency of b. It leverages the customer trust and your
the loyalty
Standard Accounting System? earned for the original brand.
a. Inaccurate Cost Allocation c. Both A and B
b. Promotes Lean Behavior d. Neither A nor B
c. Time Lag 8. In the model of lean manufacturing
d. Financial Orientation implementation
2. It records the financial effects of the physical process, the implementation and measuring
events the progress
that are occurring in the production process. stage includes the following, except:
a. General Ledger a. Waste Elimination
b. Cost Accounting Services b. Multifunctional Teams
c. Work Orders c. Environment for Change
d. Management Services d. Information Systems
3. Pledis Industrial uses 64,000 kilos of one 9. A Computer-Aided Manufacturing (CAM)
material in facility
producing ceramic products. The cost makes use of group technology cells composed
associated with of
placing each order is ₱40. The carrying cost of various types of CNC machines to produce an
one kilo entire part
of the material is ₱2. Compute for Pledis from start to finish in one location.
Industrial’s a. True
b. Computer-Aided Design (CAD) 1. Is a method of allocating costs to products
c. Computer Integrated Manufacturing (CIM) and
d. Island of Technology services to facilitate better planning and
10. Which of the following is an automated control.
production It accomplishes this by assigning cost to
planning and control system used to support activities based on their use of resources and
inventory assigning cost to cost objects based on their
management? use
a. Materials Requirements Planning of activities.
b. Manufacturing Requirements Planning a. Traditional Costing
c. Material Resources Planning b. Activity-based Costing
d. Manufacturing Resources Planning c. Standard Costing
11. Which of the following is an extension of d. Value Stream Accounting
MRP that 2. This type of valuation method includes all
has evolved beyond the confines of inventory the
management and is both a system and a costs associated with the product family, but
philosophy for makes no distinction between direct costs and
coordinating a wide range of manufacturing indirect costs.
activities? a. Traditional Costing
a. Materials Requirements Planning b. Activity-based Costing
b. Manufacturing Requirements Planning c. Standard Costing
c. Material Resources Planning d. Value Stream Accounting
d. Manufacturing Resources Planning 3. It is an automated production planning and
control system used to support inventory
12. A document in the batch processing system management.
that a. Enterprise Resource Planning (ERP)
shows the production path that a particular b. Material Requirement Planning (MRP)
batch of c. Manufacturing Requirement Planning
product follows during manufacturing. (MRP II)
a. Route sheet d. None of the Above
b. Bill of materials 4. Which of the following is not an objective of
c. Work order Material Requirement Planning (MRP)?
d. Production schedule a. Ensure that adequate raw materials are
13. Value Stream Map works best in highly available to the production
focused, b. Maintain the lowest possible level of
low-volume processes in which real benefit is inventory on hand
derived c. Produce production and purchasing
from reducing repetitive processes by even schedules and other information needed
small to control production
amounts of time. d. All are objectives of MRP
a. True 5. Which of the following statements is true?
b. False a. MRP integrates product manufacturing,
14. Production scheduling is the first activity of product engineering, sales order
the processing, customer billing, human
planning and control function. resources, and related accounting
a. True functions
b. False b. MRP II is an automated production
15. In the relationship of total inventory cost planning and control system used to
and order support inventory management
quantity, as the quantity ordered increases, the c. ERP integrates departments and
number functions across a company into one
of ordering events decreases, causing the total system of integrated applications that is
annual connected to a single common database
cost of ordering to decrease. d. None of the statements is true.
a. True 6. What best describes the philosophy of lean
b. False manufacturing?
Group 7 a. giving ample time to workers to do their
job single unit of finished product.
b. doing more with less, eliminating waste, a. Bill of materials
and reducing production cycle time b. Production schedule
c. reduction of workers in the c. Route sheet
manufacturing environment d. Work order
d. elimination of improper work etiquette 13. Document that authorizes the storekeeper
in the manufacturing process to
7. All are principles characterizing lean release materials (and subassemblies) to
manufacturing, except: individuals or work centers in the production
a. waste minimization process.
b. inventory reduction a. Bill of materials
c. perfect quality b. Move Ticket
d. Push Processing c. Materials Acquisition
8. The progression of automation toward d. Route Sheet
worldclass 14. It is an additional inventories that must be
status includes the following, except: added
a. Traditional to the reorder point to avoid unanticipated
b. Computer Integrated Manufacturing stockout
c. Islands of Technology events.
d. New Era a. Lead time
9. Which of the following best describes Value b. Safety Stock
Stream Mapping? c. Back-order
d. Raw materials
a. It can evaluate the technical feasibility 15. It shows the production path that a
of the product and determine its particular
‘‘manufacturability.’ batch of product follows during manufacturing.
b. monitors and controls the production a. Move Ticket
process and routing of products through b. Production schedule
the cell c. Work order
c. it graphically represents business d. Route sheet
processes to identify aspects of it that
are wasteful and should be removed CHAPTER 8 — FINANCIAL REPORTING AND
d. programmed to perform specific actions MANAGEMENT REPORTING SYSTEMS
over and over with a high degree of
precision and are widely used in 1. The coding scheme most appropriate for a
factories to perform jobs such as chart of
welding and riveting accounts is
10. Which of the following is the heart of the a. sequential code
lean b. block code
manufacturing philosophy? c. group code
a. Robotics d. mnemonic code
b. physical reorganization of the 2. A common use for sequential coding is
production facilities a. creating the chart of accounts
c. automation of the manufacturing b. identifying inventory items
process c. identifying documents
d. islands of technology d. identifying fixed assets
11. Which of the following is not a basic process 3. The most important advantage of sequential
of coding is
traditional batch production model? that
a. Plan and control production a. missing or unrecorded documents can be
b. Perform production operation identified
c. Bill of materials b. the code itself lacks informational content
d. Perform cost accounting c. items cannot be inserted
12. It specifies the types and quantities of the d. deletions affect the sequence
raw 4. When a firm wants its coding system to
materials and subassemblies used in producing convey
a
meaning without reference to any other the adjusted trial balance, enter adjusting
document, it entries,
would choose prepare financial statements
a. an alphabetic code b. record the transaction, prepare the
b. a mnemonic code unadjusted
c. a group code trial balance, record adjusting journal entries,
d. a block code record closing entries, prepare financial
5. The most important advantage of an statements
alphabetic code is c. record the transaction, post to the ledger,
that record
a. meaning is readily conveyed to users adjusting entries, prepare the unadjusted trial
b. sorting is simplified balance, prepare financial statements
c. the capacity to represent items is increased d. record the transaction, post to the ledger,
d. missing documents can be identified prepare
6. Entries into the General Ledger System (GLS) the adjusted trial balance, prepare financial
can be statements, record closing entries
made using information from 11. Which statement is not correct?
a. the general journal a. the post-closing trial balance reports the
b. a journal voucher which represents a ending
summary balance of each account in the general ledger
of similar transactions b. one purpose of preparing the unadjusted trial
c. a journal voucher which represents a single, balance is to ensure that debits equal credits
unusual transaction c. financial statements are prepared based on
d. all of the above the
7. Which statement is not correct? The general unadjusted trial balance
ledger d. the unadjusted trial balance reports control
master file account balances but omits subsidiary ledger
a. is based on the firm’s chart of account detail
b. contains a record for control accounts 12. What account appears on the postclosing
c. is an output of the Financial Reporting trial
System balance?
(FRS) a. income summary
d. supplies information for management b. machinery
decision c. rent expense
making d. interest income
8. What type of data is found in the general 13. Financial statements are prepared from the
ledger a. trial balance
master file? b. adjusted trial balance
a. a chronological record of all transactions c. general ledger
b. the balance of each account in the chart of d. general journal
accounts 14. Risk exposures in the General Ledger and
c. budget records for each account in the chart Financial
of Reporting Systems include all of the following
accounts except
d. subsidiary details supporting a control
account a. loss of the audit trail
9. Which report is not an output of the Financial b. unauthorized access to the general ledger
Reporting System (FRS)? c. loss of physical assets
a. variance analysis report d. general ledger account out of balance with
b. statement of cash flows the
c. tax return subsidiary account
d. comparative balance sheet 15. Which situation indicates an internal control
10. Which steps in the Financial Accounting risk in
Process are the General Ledger/Financial Reporting
in the correct sequence? Systems
a. record the transaction, post to the ledger, (GL/FRS)?
prepare a. the employee who maintains the cash journal
computes depreciation expense processing is strictly enforced
b. the cash receipts journal voucher is b. the general ledger master file is recreated
approved by with
the Treasurer each update
c. the cash receipts journal vouchers are c. updates and reconciliation of transactions
prenumbered and stored in a locked safe occur
d. the employee who maintains the cash as a step within the transaction cycle
receipts d. errors and out-of-balance conditions are
journal records transactions in the accounts identified at the end of the month
receivable subsidiary ledger 20. A characteristic of the Management
16. With a limited work force and a desire to Reporting
maintain System (MRS) is
strong internal control, which combination of a. the MRS operates in conformity with
duties generally
performed by a single individual presents the accepted accounting principles
least risk b. it is a legal requirement that the MRS be
exposure? installed and functioning properly
a. maintaining the inventory ledger and c. the MRS is developed by implementing SEC
recording requirements
the inventory journal voucher in the general d. the MRS focuses on internal decision-making
ledger information
b. recording the inventory journal voucher in 21. Which statement is not true?
the a. authority refers to an individual’s obligation
general ledger and maintaining custody of to
inventory achieve desired results
c. maintaining the cash disbursements journal b. if an employee is given the responsibility for
and a
recording direct labor costs applied to specific task, that employee should be given authority
jobs to
d. preparing the accounts payable journal make decisions within the limits of that task
voucher c. the level of detail provided to an employee is
and recording it in the general ledger a
17. The audit trail fulfills all of the following function of the employee’s position with the
purposes firm
except d. all of the above are true
a. provides the ability to answer inquiries 22. Which statement is not true? The
b. ensures the accuracy of the application manager’s span of
software control
c. fulfills governmental regulations a. is narrow for routine and repetitive tasks
d. offers a means for preventing, detecting, and b. is related to the number of layers of
correcting errors management
18. Which best describes a batch process c. affects the amount of detail provided to a
General Ledger manager
System (GLS) d. can affect employee morale and motivation
a. paper documents are eliminated 23. Short-range planning involves
b. the general ledger master file is updated a. setting goals and objectives of the firm
each b. planning the production schedule for the
night next
c. there is a time lag between transaction quarter
processing and posting to the general ledger c. planning the growth of the firm
d. no direct access or querying of the General d. deciding on the degree of diversification
Ledger is possible among
19. An advantage of a batch General Ledger the firm’s products
System 24. Long-range planning involves
(GLS) is that
a. separation between authorization and a. planning the marketing and promotion for a
transaction product
b. presenting department heads with budgetary 32. A fundamental principle of responsibility
goals for the next year accounting
c. preparing a work force utilization budget for is that
the a. managers are accountable only for items
next quarter they
d. deciding the optimum size of the firm control
25. The level of management that makes b. a manager’s span of control should not
tactical exceed
planning decisions is eight people
a. top management c. structured reports should be prepared
b. middle management weekly
c. operations management d. the information flow is in one direction,
d. front-line management topdown
26. The decision to enter a new market is an 33. Which statement is not true? Responsibility
example of accounting
a. strategic planning a. involves both a top-down and bottom-up flow
b. tactical planning of
c. management control information
d. operational control b. acknowledges that some economic events
27. All of the following are elements of cannot
operational be traced to any manager
control decisions except c. creates a budget
a. determining the scope of the activity d. compares actual performance with budget
b. setting operating standards 34. What mechanism is used to convey to
c. evaluating performance managers the
d. taking corrective action when necessary standards by which their performance will be
28. In contrast to tactical planning decisions, measured?
management control decisions, and operational a. the responsibility report
control b. the scheduled report
decisions, strategic planning decisions usually c. the budget
a. are more focused d. all of the above
b. have a shorter time frame 35. All of the following concepts encourage goal
c. are unstructured congruence except
d. have a high degree of certainty a. detailed information reporting at all
29. Which of the following management management levels
principles b. authority and responsibility
affects the management reporting system? c. formalization of tasks
a. formalization of tasks d. responsibility accounting
b. authorization 36. Which of the following statements is NOT
c. span of control true?
d. all of the above a. Sorting records that are coded alphabetically
30. All of the following are elements of problem tends to be more difficult for users than sorting
structure except numeric sequences.
a. certainty b. Mnemonic coding requires the user to
b. data memorize
c. procedures codes.
d. objectives c. Sequential codes carry no information
31. All of the following are examples of content
programmed beyond their order in the sequence.
reports except d. Mnemonic codes are limited in their ability to
a. cash flow reports for Division B represent items within a class.
b. year-to-date local income tax payments 37. Which file has as its primary purpose to
made by present
all employees living in City X and working in comparative financial reports on a historic
City Y basis?
c. inventory exception reports for Division G a. journal voucher history file
d. equipment utilization reports for Plant M b. budget master file
c. responsibility file c. Operations management
d. general ledger history file d. Front-line management
3. The decision to enter a new market is an
38. All of the following are characteristics of the example of
strategic planning process except the ___________.
a. emphasis on both the short and long run. a. Strategic planning
b. review of the attributes and behavior of the b. Tactical planning
organization’s competition. c. Management control
c. analysis of external economic factors. d. Operational control
d. analysis of consumer demand. 4. Which of the following management
39. Which of the following performance principles affects
measures can the management reporting system?
not result in dysfunctional behavior? a. Formalization of tasks
a. price variance b. Authorization
b. quotas c. Span of control
c. ROI d. All of the above
d. net income 5. It uses tags to identify each piece of financial
e. all of the above can result in dysfunctional data,
behavior which then allows it to be used
40. Which of the following best describes a programmatically by a
profit center: compatible program. It also allows an easy
a. authority to make decisions affecting the transmission
major of data between businesses.
determinants of profit, including the power to a. XBL
choose its markets and sources of supply. b. XBRL
b. authority to make decisions affecting the c. Either XBL or XBRL
major d. Neither XBL or XBRL
determinants of profit, including the power to 6. Responsibility center file contains the
choose its markets and sources of supply, and following
significant control over the amount of invested except:
capital. a. Revenues
c. authority to make decisions over the most b. Expenditures
significant costs of operations, including the c. Budgeted Revenues
power to choose the sources of supply. d. Other Resource Utilization Data
d. authority to provide specialized support to 7. Which is not part of the report attributes?
other a. Accuracy
units within the organization. b. Completeness
e. responsibility for combining the raw c. Catchy
materials, d. Exception Orientation
direct labor, and other factors of production 8. Programmed reporting has two subclasses
into a which are:
final product. I. Adhoc Report
GROUP 8 QUIZ: FINANCIAL REPORTING AND II. Scheduled Report
MANAGEMENT REPORTING SYSTEMS III. On-demand Report
1. This file provides a record of all general IV. Management Report
ledger a. I & III
transactions and replaces the traditional b. II & IV
general journal. c. II & III
a. Journal voucher file d. I & IV
b. Journal voucher history file 9. It involves sophisticated techniques such as
c. General ledger master file database
d. General ledger history file queries and artificial intelligence.
2. The level of management that makes tactical a. Data warehousing
planning b. Adhoc reporting
decisions is _________. c. Data mining
a. Top management d. Management report
b. Middle management
10. It is known to be as the formal vehicle to d. Unauthorized access to the GL accounts
convey can result in errors, fraud and
information. misrepresentations in financial
a. Accounting statements.
3. This involves a network of documents,
b. Financial statements journals,
c. Report and ledgers designated to ensure that a
d. File transaction can be accurately traced through
11. Operational control involves motivating the
managers at system from initiation to final disposition.
all levels to use resources, including materials, a. Master File
personnel, and financial assets, as productively b. XBRL Instant Documents
as c. Audit Trail
possible. d. None of the above
a. True 4. Individuals with access authority to GL
b. False accounts
12. The formalization of tasks principle should not, except:
suggests that a. Have record-keeping responsibility for
management should structure the firm around special journals or subsidiary ledgers
the unique b. Prepare journal vouchers
skills sets of key individuals. c. Have custody of physical assets
a. True d. All of the above are correct.
b. False 5. For a report to be useful, it must have:
13. According to MDN web docs, XML a. report attribute
(Extensible b. information overload
Markup Language) is a markup language c. complete information
similar to d. information content
HTML, with predefined tags to use. 6. It is the process of selecting, exploring, and
a. True modeling large amounts of data to uncover
b. False relationships and global patterns that exist in
14. The MRS uses general ledger master file to large databases but are hidden among the vast
support amount of facts.
internal information reporting. a. data discovering
a. True b. data processing
b. False c. data finding
15. On demand reports are not triggered by d. data mining
events. 7. This approach uses a drill-down technique to
a. True either verify or reject a user’s hypothesis.
b. False a. data mining
Group 8 b. ad hoc reporting
1. If risks are not controlled it may result in c. verification model
misstated financial statements and other d. discovery model
reports, 8. What do you call a report that aims at
thus misleading users of this information. The informing
potential consequences are the following, managers of different aspects of the business,
except: to
a. Significant financial loss help them make better-informed decisions?
b. Suctions specified by SEC legislation a. financial reports
c. Litigation b. ad hoc reports
d. All of the above are correct c. sales report
2. Which of the following is not correct? d. management reports
a. End-user computer cannot process XML 9. This management principle suggests that
and can only display the format. management should structure the firm around
b. End-user computer can recognize XML the tasks it performs rather than around
and process individuals with unique skills.
c. XBRL is typically used for reporting
aggregated financial data. a. Formalization of tasks
b. Responsibility and authority appropriate accounts in the GL.
c. Span of control a. Only statement 1 is true.
d. Management by exception b. Only statement 2 is true.
10. This principle suggests that managers c. Both are true.
should d. Both are false.
limit their attention to potential problem areas
rather than being involved with every activity
or
decision.
a. Formalization of tasks
b. Responsibility and authority
c. Span of control
d. Management by exception
11. These decisions are shorter term, more
specific,
recurring, have more certain outcomes, and
have
a lesser impact on the firm than strategic
decisions.
a. Management control decision
b. Tactical planning decision
c. Operational control decision
d. Strategic planning decision
12. It involves motivating managers in all
functional
areas to use resources, including materials,
personnel, and financial assets, as productively
as possible.
a. Management control decision
b. Tactical planning decision
c. Operational control decision
d. Strategic planning decision
13. Statement 1: It is assumed that the users
of
financial reports do not understand the
conventions and accounting principles that are
applied.
Statement 2: The primary recipients of financial
statement information are internal users, such
as
stockholders, creditors and government
agencies.
a. Only Statement 1 is true.
b. Only Statement 2 is true.
c. Both are false.
d. Both are true.
14. Its primary purpose is to provide historical
financial data for comparative financial reports.
a. Journal Voucher File
b. Journal Voucher History File
c. General Ledger History File
d. General Ledger Master File
15. Statement 1: Financial Reporting is the
final step
in the overall accounting process.
Statement 2: Journal vouchers for the adjusting
entries are prepared and posted to the