1. BUS 475 Final Exam set7
1) A well-designed activity-based costing system starts with __________.
2) Managerial accounting __________.
3) What effect do current technology changes have on managerial accounting?
4) The income statement and balance sheet columns of Pine Companys worksheet
reflects the following totals:
Income Statement Balance Sheet
Dr. Cr. Dr. Cr.
Totals $58,000 $48,000 $34,000 $44,000
The net income (or loss) for the period is __________.
5) "Generally accepted" in the phrase generally accepted accounting principles means
that the principles _______.
6) If a company reports a net loss, it __________.
7) 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?
8) The first step in activity-based costing is to ________.
9) Which one of the following items is not generally used in preparing a statement of
cash flows?
10) What exists when budgeted costs exceed actual results?
11) Which list below best describes the major services performed by public
accountants?
12) The cost of an asset and its fair market value are __________.
13) Sams 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?
14) A company just starting in business purchased three merchandise inventory items
at the following prices. First purchase $80; Second purchase $95; Third purchase $85.
If the company sold two units for a total of $240 and used FIFO costing, the gross profit
for the period would be _____.
15) Lucy starts her own psychiatric practice, but her expenditures to open the practice
exceed her income. Lucy is a __________.
16) Which of the following statements about GDP is correct?
17) A logical starting point from which the study of international trade begins is
__________.
18) In computing GDP, market prices are used to value final goods and services
because __________.
19) 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.

2. Each option costs $100. Finally he decides on Option B. The opportunity cost of this
decision is __________.
20) To move the allocation of resources closer to the social optimum, policymakers
should typically try to induce firms in an oligopoly to __________.
21) Resources are __________.
22) Many U.S. business leaders argue that the current state of U.S. net exports is the
result of __________.
23) The balance of payment account is made up of:
24) Real GDP __________.
25) The model of aggregate demand and aggregate supply explains the relationship
between __________.
26) 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 __________.
27) Over the past two decades, the United States has __________.
28) ABC International carefully watches the actions of its most innovative competitor
and learns from them. ABC can establish a low-cost position by:
29) A leader is:
30) The pursuit of lucrative opportunities by enterprising individuals is called:
31) 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:
32) A managers ability to stimulate people to be high performers is referred to as:
33) An invisible barrier that makes it difficult for certain groups, such as minorities
and women, to move beyond a certain level in the organizational hierarchy is referred to
as the:
34) 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:
35) Which of these refers to the practices aimed at discovering and harnessing an
organizations intellectual resources?
36) Which of these represent skills that managers need?
37) Teams that work on long-term projects but disband once the work is completed are
known as:
38) Building a dynamic organization is another way of describing which function of
management?
39) When a company establishes technology leadership by pioneering unique products
or services that command premium prices, it has benefited from a:
40) The most dominant areas in the global economy include:
41) Listening to employee suggestions, gaining support for organizational objectives
and fostering an atmosphere of teamwork are all considered:
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) A poll showed that 48 out of 120 randomly chosen graduates of California medical
schools last year intended to specialize in family practice. What is the width of a 90%
confidence interval for the proportion that plan to specialize in family practice?

3. 44) 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 Crime = 428 + .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)?
45) In a random sample of 810 women employees, it is found that 81 would prefer
working for a female boss. The width of the 95% confidence interval for the proportion
of women who prefer a female boss is _____.
46) Independent events A and B would be consistent with which of the following
statements:
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, the standard deviation is approximately _____.
48) In lean systems, if a defective product is found, which of the following is generally
NOT done?
49) In a network diagram, an activity:
50) Which is not a tool of statistical quality control?
51) A computer analysis reveals that the best-fitting trend model is Yt = 4.12 e 0.987 t.
The trend was fitted using year-end common stock prices for Melodic Kortholt Outlet for
the last six years. The R2 is 0.8571.
If we fit a linear trend to data that are growing exponentially __________.
52) The one-worker, multiple machines approach functions as:
53) Zappos built the majority of its information systems using which of the following?
54) Search engines and metasearch engines are examples of which network
application?
55) In the _____ phase of the decision making process, managers test potential
solutions �on paper.�
56) The costs of delivering products in the _____ channel are much higher than
delivering products in the _____ channel.
57) _____ is the integration of economic, social, cultural, and ecological facets of life,
enabled by information.
58) Which of the following are not provided by digital dashboards?
59) A company wants to use data from past promotional mailings to identify people
who would likely respond favorably to future mailings. This company would most likely
use _____.
60) Credit card companies would most likely use which of the following to check for
fraudulent credit card use?
61) Computer support is greatest for which of the following problems?
62) International Game Technology�s new ERP system produced all of the following
benefits except:
63) Disadvantages of using current liabilities as opposed to long-term debt include:
64) Suppose you determine that the NPV of a project is $1,525,855. What does that
mean?
65) An increase in future value can be caused by an increase in the __________.
66) Dublin International Corporation�s marginal tax rate is 40%. It can issue three-
year bonds with a coupon rate of 8.5% and par value of $1,000. The bonds can be sold
now at a price of $938.90 each. The underwriters will charge $23 per bond in flotation
costs. Determine the approximate after-tax cost of debt for Dublin International to use
in a capital budgeting analysis.

4. 67) A stock with a beta greater than 1.0 has returns that are _____ volatile than the
market, and a stock with a beta of less than 1.0 exhibits returns which are _____
volatile than those of the market portfolio.
68) At 8% compounded annually, how long will it take $750 to double?
69) 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?
70) Exchange rate risk:
71) According to the hedging principle, permanent assets should be financed with
_____ liabilities.
72) PepsiCo calculates unlevered betas for each peer group in order to:
73) If the quote for a forward exchange contract is greater than the computed price, the
forward contract is:
74) Bondholders have a priority claim on assets ahead of:
75) The common stockholders are most concerned with:
76) Regarding organizational buying, the people who have the power to select or
approve the supplier--especially for larger purchases--are called:
77) "Marketing strategy planning" means:
78) A cluster analysis of the "toothpaste market" would probably show that:
79) When doing "positioning," a marketing manager should:
80) Economists economic-buyer theory assumes that __________.
81) The managerial process of developing and maintaining a match between the
resources of an organization and its market opportunities is called:
82) When evaluating macro-marketing:
83) "Positioning":
84) Coca-Cola is taking advantage of the new willingness of Chinese leaders to engage
in international trade by marketing its soft drinks in China. What type of opportunity is
Coke pursuing?
85) In comparison to the buying of final consumers, the purchasing of organizational
buyers:
86) The basic objective of the U.S. market-directed economic system is to:
87) The clustering techniques that can be used in segmenting:
88) Which of the following terms need not be disclosed under Truth-in-Lending Act?
89) The tort of intentional interference with contractual relations requires the following
except:
90) Which of the following is correct about litigating commercial disputes?
91) Which of the following activities by an administrative agency requires public notice
and participation?
92) What type of commercial speech did the U.S. Supreme Court say was protected in
the Greater New Orleans Broadcasting Association, Inc. v. United States case?
93) Which of the following lists, in descending priority, of sources considered by most
courts in settling questions of international law?
94) Information which comes to the knowledge of an agent is:
95) A professional corporation is one that:
96) What makes a publicly held corporation different from a public corporation?
97) A �closely held corporation� is a corporation that is owned by:
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 worlds goods?

5. 100) Although the U.S. has had a longstanding agreement with _____ after the passage
of NAFTA, _____ became the United States second largest trading partner.