What is Managerial Accounting and how does it support internal planning decisions? Involves auditing and ensuring financial statements are accurate. Focuses on external reporting, macro-level analysis, and high accuracy. Deals with tax preparation and compliance, focusing on legal requirements. Supports internal planning, focuses on individual units, reported frequently with reasonable accuracy.

Supports internal planning, focuses on individual units, reported frequently with reasonable accuracy.

What is Financial Accounting and what is its primary orientation? Focuses on internal auditing and fraud detection. Future-oriented, focuses on individual units, and reported frequently. Scorekeeping, past orientation, macro-level, issued periodically with high accuracy. Involves tax compliance and legal reporting requirements.

Scorekeeping, past orientation, macro-level, issued periodically with high accuracy.

What happens to total variable costs when activity levels change? They decrease as activity levels increase. They increase exponentially with activity changes. They remain unchanged regardless of activity levels. They change when activity changes, remaining constant per unit.

They change when activity changes, remaining constant per unit.

How do fixed costs behave in relation to changes in activity levels? Remain unchanged in total, change inversely per unit. Fluctuate randomly with no relation to activity levels. Increase with higher activity levels, decrease with lower. Change directly with activity levels, constant per unit.

Remain unchanged in total, change inversely per unit.

What is the formula for calculating variable costs? Average cost per unit x total production. Fixed cost per unit x total units produced. Variable rate per unit x # of units of activity. Total cost divided by number of units.

Variable rate per unit x # of units of activity.

Which of the following are considered typical variable costs? Depreciation, amortization, and interest expenses. Administrative salaries, office supplies, and rent. Raw materials, direct labor, utilities, shipping costs, and sales commissions. Real estate taxes, insurance, and supervisory salaries.

Raw materials, direct labor, utilities, shipping costs, and sales commissions.

What are typical fixed costs in a business? Marketing expenses, travel costs, and bonuses. Utilities, shipping costs, and variable overhead. Raw materials, direct labor, and sales commissions. Real estate taxes, insurance, and supervisory salaries.

Real estate taxes, insurance, and supervisory salaries.

As revenues increase, what happens to variable expenses and contribution margin? Variable expenses will decrease, and contribution margin will increase exponentially. Variable expenses and contribution margin will increase proportionately. Both variable expenses and contribution margin will remain unchanged. Fixed expenses will decrease, and contribution margin will remain constant.

Variable expenses and contribution margin will increase proportionately.

What does the term 'sales mix' refer to in a company's operations? The relative combination in which a company's different products are sold. The pricing strategy used to maximize revenue. The distribution channels used to reach customers. The total volume of sales achieved in a given period.

The relative combination in which a company's different products are sold.

What is the impact of a change in the sales mix on a company's financials? Leads to a decrease in total sales revenue. Causes an increase in fixed costs. Results in a different contribution margin ratio. Has no impact on the company's financials.

Results in a different contribution margin ratio.

When a company using the allowance method writes off a specific customer's account receivable, which of the following statements are true? Total expenses remain the same. Total stockholders' equity remains the same. Total assets remain the same. None of the above.

Total stockholders' equity remains the same.

When using the allowance method, as Bad Debt Expense is recorded, which of the following statements is true? Total liabilities increase and stockholders' equity decreases. Total assets increase and stockholders' equity decreases. Total assets decrease and stockholders' equity decreases. Total assets remain the same and stockholders' equity remains the same.

Total assets remain the same and stockholders' equity remains the same.

For Carefree Company using the aging of accounts receivable method, what does the estimate of uncollectible receivables equal? The ending balance in the Allowance for Doubtful Accounts for the period. The change in the Allowance for Doubtful Accounts for the period. Both (a) and (c). Bad Debt Expense for the current period.

The change in the Allowance for Doubtful Accounts for the period.

Which of the following best describes the proper presentation of accounts receivable in the financial statements? Accounts Receivable in the asset section of the balance sheet and the Allowance for Doubtful Accounts in the expense section of the income statement. Accounts Receivable plus the Allowance for Doubtful Accounts in the asset section of the balance sheet. Accounts Receivable less Bad Debt Expense in the asset section of the balance sheet. Accounts Receivable less the Allowance for Doubtful Accounts in the asset section of the balance sheet.

Accounts Receivable less the Allowance for Doubtful Accounts in the asset section of the balance sheet.

If 5 percent notes receivable for $100,000 are created on January 1, 2021, what interest revenue will be recorded in 2021? No interest revenue will be recorded in 2021. The notes receivable will be classified as a current asset. None of the above. Interest Revenue of $5,000 will be recorded in 2021.

Interest Revenue of $5,000 will be recorded in 2021.

If the receivables turnover ratio decreased during the year, what does this indicate about receivables collections? Sales Revenues increased at a faster rate than Accounts Receivable increased. The days to collect also decreased. Receivables collections slowed down. None of the above.

Receivables collections slowed down.

In 2018, Coca-Cola Bottling had a receivables turnover ratio of 9.0. Which action could increase this ratio? Increase the percentages used to estimate bad debts. Factor its receivables. All of the above. Pursue collections more aggressively.

Pursue collections more aggressively.

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