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ACCT 3013 EXAM 2 LATEST VERSION
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ACCT 3013 EXAM 2 LATEST VERSION...
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1. Budgeting is the common accounting tool companies use for planningand controlling. Budgets
a. provide a measure of planned financial results.
b. are prepared independently of the company's long-term strategies.
c. do not usually reflect actual results, so they are a useless exercise.
d. serve as the financial expression of management's plans for the
upcoming period. - ANSWER d. serve as the financial expression of
management's plans for the upcoming period.
3. Which of the following is not a major benefit of budgets?
a. Compels planning
b. Eliminates innovation
c. Provides performance criteria
d. Promotes coordination and communication - ANSWER b. Eliminates
innovation
6. Which of the following does not pertain to financial planning models in
software form?
a. Reduces computational burden and time required to prepare budgets
b. Eliminates need to update budgets as uncertainty resolved
c. Assists managers with sensitivity analysis
d. Performs calculations that are mathematical representations of
relationships in master budget - ANSWER b. Eliminates need to update
budgets as uncertainty resolved
7. The major cost management concept used in kaizen budgeting is that
of
a. eliminating inventories of every type but materials.
b. refinements in the indirect-cost categories for costing systems.
c. continuous improvement.
d. sensitivity analysis using computer-based financial planning models. -
ANSWER c. continuous improvement.
, 8. Which of the following statements does not describe responsibility
accounting?
a. It measures the plans and actions of each responsibility center.
b. It budgets to emphasize that for which each responsibility center is
accountable.
c. It calculates variances between budgeted and actual accountability for
each responsibility center.
d. It identifies managers at fault for operating problems by reports for
each responsibility center. - ANSWER d. It identifies managers at fault
for operating problems by reports for each responsibility center.
9. Controllability
a. is always clear cut as to who has responsibility for a cost.
b. is another term for responsibility.
c. is the responsibility of the corporate controller.
d. is the degree of influence a specific manager has over costs,
revenues, and other items. - ANSWER d. is the degree of influence a
specific manager has over costs, revenues, and other items.
10. Budgetary slack
a. is going to be included in budget estimates, so it should just be
ignored.
b. provides managers with a hedge against unexpected circumstances.
c. should be totally eliminated from the budget.
d. is not found in governmental budgets. - ANSWER b. provides
managers with a hedge against unexpected circumstances.
1. [CMA Adapted] Flexible budgets
a. accommodate changes in the inflation rate.
b. accommodate changes in activity levels.
c. are used to evaluate capacity utilization.
d. are static budgets that have been revised for changes in price(s). -
ANSWER b. accommodate changes in activity levels.
4. Which of the following is not an advantage for using standard costs for
variance analysis?
a. Standards simplify product costing.
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