1. BUS 475 Final Exam 1
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1) The cost principle requires that when assets are acquired, they be recorded at
__________.
2) "Generally accepted" in the phrase generally accepted accounting principles
means that the principles __________.
3) The standards and rules that are recognized as a general guide for financial
reporting are called __________.
4) Sam's Used Cars uses the specific identification method of costing inventory.
During March, Sam purchased three cars for $6,000, $7,500, and $9,750,
respectively. During March, two cars are sold for $9,000 each. Sam determines that
at March 31, the $9,750 car is still on hand. What is Sam’s gross profit for March?
5) Hess, Inc. sells a single product with a contribution margin of $12 per unit and
fixed costs of $74,400 and sales for the current year of $100,000. How much is Hess’s
break even point?
6) As Plant Controller, you are trying to determine which costs over which you have
the most control on a day to day basis. Your goal is to achieve better profitability.
The Plant Operations Manager suggests that overhead is the easiest area to directly
reduce costs. Which of the following items would be classified as manufacturing
overhead?
7) What is the preparation of reports for each level of responsibility in the company’s
organization chart called?
8) Disney’s variable costs are 30% of sales. The company is contemplating an
advertising campaign that will cost $22,000. If sales are expected to increase
$40,000, by how much will the company's net income increase?
9) The cost of an asset and its fair market value are __________.
10) Which one of the following is a product cost?
11) What exists when budgeted costs exceed actual results?
12) The income statement and balance sheet columns of Pine Company's worksheet
reflects the following totals:

2. Income Statement Balance Sheet
Dr. Cr. Dr. Cr.
Totals $58,000 $48,000 $34,000 $44,000
Closing entries are necessary for __________.
13) Managerial accounting __________.
14) H55 Company sells two products, beer and wine. Beer has a 10 percent profit
margin and wine has a 12 percent profit margin. Beer has a 27 percent contribution
margin and wine has a 25 percent contribution margin. If other factors are equal,
which product should H55 push to customers?
15) Lekeisha's income exceeds her expenditures. Lekeisha is a __________.
16) Maurice receives $100 as a birthday gift. In deciding how to spend the money, he
narrows his options down to four choices: Option A, Option B, Option C, and Option
D. Each option costs $100. Finally he decides on Option B. The opportunity cost of
this decision is __________.
17) A production possibilities frontier will be a straight line if __________.
18) In economics, the cost of something is __________.
19) A tax on an imported good is called a __________.
20) Which of the following statements about GDP is correct?
21) In computing GDP, market prices are used to value final goods and services
because __________.
22) Which of the following statements about GDP is correct?
23) Which of the following is not correct?
24) The part of the balance of payments account that lists all long-term flows of
payments is called the:
25) Edward Prescott and Finn Kydland won the Nobel Prize in Economics in 2004.
One of their contributions was to argue that if a central bank could convince people
to expect zero inflation, then the Fed would be tempted to raise output by
increasing inflation. This possibility is known as __________.
26) In general, the longest lag for __________.

3. 27) Consider two items that might be included in GDP: (1) The estimated rental
value of owner-occupied housing; and (2) purchases of newly-constructed homes.
How are these two items accounted for when GDP is calculated?
28) Managers will utilize __________ skills with increasing frequency as they rise
within an organization.
29) Which of these represent skills that managers need?
30) Building a dynamic organization is another way of describing which function of
management?
31) Your roommate is interested in starting a business and everybody has been
giving him different information about being an entrepreneur. Since you have been
studying about entrepreneurship and new ventures, which of these would you tell
him is true?
32) The term used to refer to all kinds of differences including religious affiliation,
age, disability status, economic class and lifestyle in addition to gender, race,
ethnicity and nationality is:
33) A manager's ability to stimulate people to be high performers is referred to as:
34) A series of quality standards developed by a committee working under the
International Organization for Standardization to improve total quality in all
businesses for the benefit of both producers and consumers is:
35) Japanese manufacturers' kaizen (continuous improvement) programs enable
them to maintain:
36) Listening to employee suggestions, gaining support for organizational
objectives and fostering an atmosphere of teamwork are all considered:
37) The basic components of an effective sexual harassment policy include the
following EXCEPT:
38) Teams that operate separately from the regular work structure and exist
temporarily are known as:
39) The Aquatic Center, Inc. periodically reviews the goals of the company. During
the process, The Aquatic Center managers analyze their current strategies as
compared to their competitors, determine goals that they will pursue and decide
upon specific actions for each area of the company to take in pursuit of these goals.
The Aquatic Center managers have been engaged in the management function of:
40) As related to managing of human resources, diversity refers to:

4. 41) __________ is the process of working with people and resources to accomplish
organizational goals.
42) Twelve randomly-chosen students were asked how many times they had missed
class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, the median is _____.
43) Use the following table to answer question:
P(S | W) is approximately _____.
44) Use the following table to answer question:
P(M A) is approximately _____.
45) Dullco Manufacturing claims that its alkaline batteries last forty hours on
average in a certain type of portable CD player. Tests on a random sample of 18
batteries showed a mean battery life of 37.8 hours with a standard deviation of 5.4
hours.
In determining the p-value for reporting the study's findings, which of the following
is true?
46) William used a sample of 68 U.S. cities to estimate the relationship between
Crime (annual property crimes per 100,000 persons) and Income (median income
per capita). His estimated regression equation was + .050 Income.
Which outcomes would be likely in a bivariate regression on 45 randomly chosen
U.S. cities in 2005 with
of robberies in each city (thousands of robberies) and
of police force in each city (thousands of police)?
47) Twelve randomly-chosen students were asked how many times they had missed
class during a certain semester, with this result: 2, 1, 5, 1, 1, 3, 4, 3, 1, 1, 5, 18.
For this sample, which measure of central tendency is least representative of the
“typical” student?
48) Likely reasons for inaccurate control limits would include which of the following?
49) You are faced with a linear programming objective function of:
Max P = $20X + $30Y

5. and constraints of:
3X + (Constraint A)
5X – (Constraint B)
You discover that the shadow price for Constraint A is 7.5 and the shadow price for
Constraint B is 0. Which of these statements is TRUE?
50) A project has three paths. A–B–C has a length of 25 days. A–D–C has a length of
15 days. Finally, A–E–C has a length of 20 days. Which one of the following
statements is TRUE?
51) Which one of the following statements concerning production and staffing plans
is best
52) While glancing over the sensitivity report, you note that the stitching labor has a
shadow price of $10 and a lower limit of 24 hours with an upper limit of 36 hours. If
your original right hand value for stitching labor was 30 hours, you know that:
53) The costs of delivering products in the _____ channel are much higher than
delivering products in the _____ channel.
54) When customers access a Web site and make purchases, they generate
__________.
55) _____ is the integration of economic, social, cultural, and ecological facets of life,
enabled by information.
56) Various organizations that promote fair and responsible use of information
systems often develop __________.
57) What is _____ is not necessarily _____.
58) _____ provides users with a view of what is happening, where _____ addresses
why it is happening.
59) Computer support is greatest for which of the following problems?
60) The management cockpit best exemplifies which type of system?
61) _____ is the efficient and effective execution of specific tasks.
62) Geocoding is __________.
63) At 8% compounded annually, how long will it take $750 to double?

6. 64) Which of the following represents an attempt to measure the earnings of the
firm’s operations over a given time period?
65) A machine costs $1,000, has a three-year life, and has an estimated salvage
value of $100. It will generate after-tax annual cash flows (ACF) of $600 a year,
starting next year. If your required rate of return for the project is 10%, what is the
NPV of this investment? (Round your answerwer to the nearest $10.)
66) Disadvantages of using current liabilities as opposed to long-term debt include:
67) Petrified Forest Skin Care, Inc. pays an annual perpetual dividend of $1.70 per
share. If the stock is currently selling for $21.25 per share, what is the expected rate
of return on this stock?
68) Which of the following is most consistent with the hedging principle in working
capital management?
69) An increase in future value can be caused by an increase in the __________.
70) If the quote for a forward exchange contract is greater than the computed price,
the forward contract is:
71) Your company is considering an investment in a project which would require an
initial outlay of $300,000 and produce expected cash flows in Years 1 through 5 of
$87,385 per year. You have determined that the current after-tax cost of the firm’s
capital (required rate of return) for each source of financing is as follows:
Cost of debt 8%
Cost of preferred stock 12%
Cost of common stock 16%
Long-term debt currently makes up 20% of the capital structure, preferred stock
10%, and common stock 70%. What is the net present value of this project?
72) Suppose you determine that the NPV of a project is $1,525,855. What does that
mean?
73) The common stockholders are most concerned with:
74) PepsiCo calculates unlevered betas for each peer group in order to:
75) Which of the following best represents operating income?

7. 76) In comparison to the buying of final consumers, the purchasing of organizational
buyers:
77) The basic objective of the U.S. market-directed economic system is to:
78) Comparing GDP for foreign countries can help a marketing manager evaluate
potential markets if the manager remembers that:
79) A firm's "marketing mix" decision areas would NOT include:
80) __________ is a marketing management aid which refers to how customers
think about proposed and/or present brands in a market.
81) The "four Ps" of a marketing mix are:
82) When evaluating macro-marketing:
83) A cluster analysis of the "toothpaste market" would probably show that:
84) Clustering techniques applied to segmenting markets __________.
85) The three basic tasks of ALL managers, according to the text, are:
86) The difference between target marketing and mass marketing is that target
marketing:
87) When one considers the strategy decisions organized by the four Ps, branding is
related to packaging as:
88) Which of the following statements is not true under the Fair Labor Standards
Act?
89) Probable cause is most directly associated with which step of the criminal
process?
90) Which of the following statements is generally not true about state intermediate
appellate courts?
91) Which of the following terms need not be disclosed under Truth-in-Lending Act?
92) Which of the following activities by an administrative agency requires public
notice and participation?
93) Which of the following is not one of the Caux Round Table Principles for
International Business?

8. 94) The theory of business social responsibility that holds that a business owes
duties solely to produce the highest return for its shareholders is:
95) Which social responsibility theory has been advocated by Novel Prizewinning
economist Milton Friedman?
96) Which of the following lists, in descending priority, of sources considered by
most courts in settling questions of international law
97) If the value of the collateral is less than the debt owed to the secured party, then:
98) One study found that manufacturing labor costs about _____ an hour in China,
compared to _____ dollars in the United States.
99) Which country does the text describe as becoming the largest producer and
consumer of many of the world's goods?
100) Although the U.S. has had a longstanding agreement with _____ after the
passage of NAFTA, _____ became the United States' second largest trading partner.
BUS 475 Final Exam 1
PLEASE DOWNLOAD THE ANSWERS HERE!!!