Accounting

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Question 1 Which of the following would be most effective in a small owner/manager-operated business? Profit centers Centralization Investment centers Cost centers Question 2 A manager is responsible for costs only in a(n): profit center investment center volume center cost center Question 3 For higher levels of management, responsibility accounting reports: are more detailed than for lower levels of management are more summarized than for lower levels of management contain about the same level of detail as reports for lower levels of management are rarely provided or reviewed Question 4 A responsibility center in which the department manager has responsibility for and authority over costs and revenues is called a(n): profit center investment center volume center cost center Question 5 Which of the following expenses incurred by the sporting goods department of a department store is a direct expense? Depreciation expense--office equipment Insurance on inventory of sporting goods Uncollectible accounts expense Office salaries Question 6 Division X reported income from operations of $975,000 and total service department charges of $575,000. Therefore: net income was $400,000 the gross profit margin was $400,000 income from operations before service department charges was $1,550,000 consolidated net income was $400,000 Question 7 The following financial information was summarized from the accounting records of Train Corporation for the current year ended December 31:
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Rails Division Locom otive Divisio n Corporate Total Cost of goods sold $47,200 $30,720 Direct operating expenses 27,200 20,040 Net sales 98,000 68,000 Interest expense $ 2,040 General overhead 18,160 Income tax 4,700 The income from operations for the Locomotive Division is: $47,80 0 $20,60 0 $17,24 0 $37,28 0 Question 8 The following is a measure of a manager’s performance working in a profit center. balance sheet rate of return and residual income measures budget performance report divisional income statements Question 9 Mason Corporation had $650,000 in invested assets, sales of $700,000, income from operations amounting to $99,000, and a desired minimum rate of return of 15%. The investment turnover for Mason is: 1.0 8 .93 6.5 7 7.0 7 Question 10 Mason Corporation had $650,000 in invested assets, sales of $700,000, income from operations amounting to $99,000, and a desired minimum rate of return of 15%. The residual income for Mason is: $0 $84,15 0 ($6,000 ) $1,500 Question 11
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Chicks Corporation had $1,100,000 in invested assets, sales of $1,210,000, income from operations amounting to $242,000, and a desired minimum rate of return of 15%. The residual income for Chicks is: $60,50 0 $22,00 0 $77,00 0 $24,20 0 Question 12 Managers of what type of decentralized units have authority and responsibility for revenues, costs, and assets invested in the unit? Profit center Investment center Production center Cost center Question 13 A responsibility center in which the department manager is responsible for costs, revenues, and assets for a department is called: a cost center a profit center an operating center an investment center Question 14 In an investment center, the manager has the responsibility for and the authority to make decisions that affect:
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This document was uploaded on 03/09/2012.

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test 3 - Question 1 Which of the following would be most...

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