MBA6100 exam preparation.docx

MBA6100 exam preparation.docx - MBA 6100 Final Exam...

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MBA 6100 Final Exam Instructions: Read each question before answering. Exam will be completed on an individual basis. Final answer should be clearly identified. Calculators are permitted; no other items are to be used. True/False Questions worth 2 pts each. 1. Self-imposed budgets prepared by lower-level managers should be scrutinized by higher levels of management. 2. Budgets are used to plan and to control operations. 3. Fixed costs should be ignored when evaluating how well a manager has controlled costs. 4, A flexible budget can be used to estimate what revenues and costs should have been, given the actual level of activity for the period. 5, An unfavorable spending variance may reflect waste as well as paying too much for inputs. 6. The standard price per unit for direct materials should not include the cost of delivering the materials. 7. The standard labor rate per hour defines the company's expected direct labor wage rate per hour* including employment taxes and fringe benefits. 8. Only future costs that differ between alternatives are relevant in decision making.
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9. A product whose revenues do not cover the sum of its variable costs, its traceable fixed costs, and its allocated share of general corporate administrative expenses should usually be dropped. 10. Joint products are products that are sold to customers as a set or as a part of a group of products. 11. One criticism of the paycheck method is that it ignores cash flows that occur after the payback point has been reached. The required rate of return is the minimum rate of return that an investment project must yield to the acceptabfe. Multiple Choice Questions worth 4 pts each. 1. Which of the following is NOT an objective of the budgeting process? A. To communicate management's plans throughout the entire organization. B. To provide a means of allocating resources to those parts of the organization where they can be used most effectively. CD. To ensure that the company continues to grow. D. To uncover potential bottlenecks before they occur. 2. Koda Corporation makes collections on sales according to the following schedule: 25% in month of sale 65% in month following the sale 5% in second month following the sale 5% uncollectible The following sales have been budgeted:
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April $120,000 May $100,000 June $110,000 Budgeted cash collections in June would be: A. $27,500 @ $98,500 c.
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