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ETS Business Exam Study Guide questions n answers
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ETS Business Exam Study Guide questions n answers
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ETS Business Exam Study GuideAccounting: What costs should be considered when making non-routine decisions? (3) - correct answer
✔✔The price of material, Factory overhead costs, and the price of labor
Accounting: Total product/ units produced and sold equals?? - correct answer ✔✔Product Cost per Unit
Accounting: What is a general explanation of what the contribution margin is? - correct answer ✔✔The
difference between variable costs subtracted from sales
Accounting: In a continuous budget plan how many months are generally planned? - correct answer
✔✔12 months
Accounting: Which of the following is not one of the weaknesses of standard costing - correct answer
✔✔It makes accounting for price increases more accurate
Accounting: What are the potential ways to find the price of what a produced products should cost? (3) -
correct answer ✔✔Product cost concept, total cost concept, and variable cost concept
Accounting: Which report is the connecting link between the income statement and the balance sheet? -
correct answer ✔✔Cash flow statement
The net cash flow from operating activities normally differs from the amount of net income for the
period. - correct answer ✔✔True
Accounting: Expense accounts would have a balance on which side? - correct answer ✔✔Left side
Accounting: A profit-making business operating as a separated legal entity and in which ownership is
divided into shares of stock is known as a... - correct answer ✔✔Corporation
,Accounting: A debt may slightly - correct answer ✔✔Increase in an asset account
Accounting: What would be classified as a current asset on the balance sheet - correct answer
✔✔Accounts receivable
Accounting: What are the elements of internal control? (3) - correct answer ✔✔Control environment,
monitoring, and control procedures.
True or False: A cash distribution of earnings by a corporation to its stockholders is called a CASH
DIVIDEND. The 3 conditions that a corporation must meet to pay a cash dividend are: sufficient retained
earnings, sufficient cash, and formal action by the board of directors. - correct answer ✔✔True
Accounting: Factors in computing depreciation are? - correct answer ✔✔Initial cost + residual value =
depreciable
Accounting: The statement of cash flows reports a firm's major cash inflows and outflows for a period. It
provides useful information about a company's ability to do the following?? - correct answer ✔✔Meet
its financial obligations, generate cash from operations, and maintain and expand its operating capacity
Accounting: True or False: Notes receivables are amounts that customers owe for which a formal, written
instrument of credit has been issued. If longer than a year it is considered an investment. - correct
answer ✔✔True
Accounting: The excess of current assets of a business over its current liabilities is called? - correct
answer ✔✔Working capital
Accounting: What 2 categories are considered under period costs? - correct answer ✔✔selling expenses
and administrative expenses
Accounting: The effect of a difference in the number of units sold, assuming no charge in unit sales price
or unit cost is... - correct answer ✔✔Quantity factor
, Accounting: A cost that will not be affected by later decisions is termed an - correct answer ✔✔Sunk
Cost
Accounting: The unfavorable volume variance may be due to all but the following facts... - correct answer
✔✔Unexpected increases in the cost of utilities
Accounting: What budget allows for adjustments in activity levels? - correct answer ✔✔Flexible budget
Accounting: A budget that summarizes future plans for the acquisition of fixed assets is the... - correct
answer ✔✔Capital expenditures budget
Accounting: What are the standard framework of guidelines for financial accounting used in any given
jurisdiction, also known as accounting standards?? - correct answer ✔✔GAAP
Economics: What occurs when the price level rises? - correct answer ✔✔People need to hold more
money, so interest rates rise, making firms borrow and invest less
Economics: The federal government enacted regulation in the 1960's requiring people to wear seatbelt
in their cars. All of the following resulted from this regulation, EXCEPT: - correct answer ✔✔Fewer
pedestrians were killed in car accidents.
Economics: Which of the following is true regarding the production possibilities frontier model of the
economy? - correct answer ✔✔Any point along the PPF represents an efficient level of production.
Economics: If the price in a market happens to be above equilibrium, there will be a _____ in the market,
and the price will tend to _____. - correct answer ✔✔Surplus, drop
Economics: The price elasticity of demand tends to be more elastic... - correct answer ✔✔At points
further up and to the left along the demand curve
Economics: If a tax imposed on a good and the incidence of the tax ends up falling more heavily on the
buyers than on the sellers, this will be because... - correct answer ✔✔Demand is less elastic than supply
for that good
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