Flashcards in Deck 17 Deck (28):
What variance measures the departure from the denominator level of activity that was used to set the fixed OH rate?
Production volume variance
Gain or loss generated from the conversion of financial statements from one currency to another based on different exchange rates
The value of the euro will fall in relation to the US Dollar; what kind of risk exposure is this?
The imputed interest rate used in the residual income approach is
Target return on investment set aside by management
The risk of choosing inappropriate technology
What working capital financing policy subjects the firm to the greatest risk?
Financing permanent current assets with short-term debt
When managing cash and short term investments, a corporate treasurer is primarily concerned with:
Liquidity and safety (board of directors and mgmt would be interested in maximizing rate of return)
An example of a risk that can be reduced by diversification?
Labor strikes (anything specific to a firm)
In microeconomic analysis, in the long run all supply side inputs are
How would change the aggregate demand and supply to decrease inflation?
Decrease AD and increase AS
Which component of ERM addresses an entity's process of distinguishing between different risks and opportunities?
Process for establishing the likelihood and impact of events
Which component of ERM addresses an entity's financial reporting objectives?
Risk assessment (control environment is used for financial reporting competencies)
Definition of application input control
Validates data before the data is successfully input
Run control total
Output control that is used to compare manual and computer generated batch totals
Repatriation restrictions exist when:
A company invests money in a foreign company but is restricted from bringing that money back to its home country
Full employment occurs when
There is no cyclical unemployment
examples of cost objectives
Efficiency measurement, determination of net income, and valuation of unexpired costs
How selling costs treated under the by-product method vs. joint product method?
By-product: including in gross margin; Joint product: not included in gross margin; Net income is the same under both methods
Acquire and implement vs. delivery and support (COBIT model)
AI: deliver the solution; DS: deliver the service
Strategic business units are established in what kind of environment?
Decentralized, not centralized
lost contribution from not taking the job
Cost allocation is essential for?
Measuring income and assets for external reporting
Average gross receivables =
average daily sales x average collection period
are joint costs relevant costs?
The steering committee provides....while the project manger provides...?
advise to the sponsor; manages the project
Which of the following requires a preexisting relationship before doing business? (BSB, B2C, EDI)