Ccsi Final

 1. | Question : | (TCO 9) Which of the following is a major accounting contribution to the managerial decision-making process in evaluating possible courses of action? |

|

  | Student Answer: | |  Determine who is responsible for the decision. |

  | | |  Prepare internal reports that review the actual impact of a decision made. |

  | | |  Calculate how much should be invested for each potential project. |

  | | |  Select possible actions that management should consider. |

  | Instructor Explanation: | Chapter 9, Pages 408-409 |

|

|

  | | |

  | | |

|

|

 2. | Question : | (TCO 9) When is incremental analysis most useful? |

|

  | Student Answer: | |  After a decision has been made to determine its effectiveness |

  | | |  In choosing between capital budgeting methods |

  | | |  In evaluating the profitability of a company |

  | | |  In developing relevant information for management decisions |

  | Instructor Explanation: | Chapter 9, Page 409 |

|

|

  | | |

  | | |

|

|

 3. | Question : | (TCO 9) What is the nature of an opportunity cost? |

|

  | Student Answer: | |  It is always variable. |

  | | |  It is a potential benefit. |

  | | |  It is included as part of cost of goods sold. |

  | | |  It is a sunk cost. |

  | Instructor Explanation: | Chapter 9, Page 410 |

|

|

  | | |

  | | |

|

|

 4. | Question : | (TCO 9) A company is deciding whether or not to replace some old equipment with new equipment. Which of the following is not considered in the incremental analysis? |

|

  | Student Answer: | |  Annual operating cost of the new equipment |

  | | |  Annual operating cost of the old equipment |

  | | |  Net cost of the new equipment |

  | | |  Book value of the old equipment |

  | Instructor Explanation: | Chapter 9, Page 417 |

|

|

  | | |

  | | |

|

|

 5. | Question : | (TCO 9) It costs Lannon...