Category Archives: BUS 475 Capstone Final Examination Part 2 BUS 475 FINAL EXAM JUNE 2017

MKT 421 FINAL EXAM 2017

MKT 421 FINAL EXAM 2017

 

 

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MKT 421 FINAL EXAM 2017

MKT 421 FINAL EXAM 2017

MKT 421 FINAL EXAM 2017

MKT 421 FINAL EXAM 2017

MKT 421 FINAL EXAM JUNE 2017

28 CORRECT ANSWERS

__________ is best defined as the process of continuously obtaining information on events happening outside a company to recognize and interpret possible trends that affect marketing.

Relationship marketing

Digital marketing

Customer relationship management

Environmental scanning

A __________ is often referred to as a business firm.

government agency

nonprofit organization

publicly owned organization

for-profit organization

The __________ refers to the seven stages a company goes through to recognize opportunities and convert them into sellable services or products

service gap analysis

strategic focus and plan

new-product process

psychographic segmentation process

__________ differentiates retail outlets depending on whether contractual systems independent retailers, or corporate chains own the outlet.

Form of ownership

Retail servicing

Level of service

Merchandise line

Which of the following is true of the price equation?

Extra fees are not part of the price equation.

Sellers subtract the add-on charges from the list price.

The amount paid by customers is always the same as the quoted price.

Customers are more inclined to pay additional fees than a higher list price.

A society’s __________ represent socially or personally preferable states of existence or modes of conduct that persist over time.

languages

symbols

values

customs

__________ segmentation is done according to an objective measurable physical or other classification attribute of potential consumers.

Psychographic

Demographic

Behavioral

Geographic

A __________ is any word, device (shape, design, color, or sound), or combination thereof used to differentiate a seller’s services or products

brand name

trade name

trademark

brand personality

Yes Music is the authorized distributor for products of Trompa Instruments, a popular manufacturer of trumpets and other brass instruments. Yes Music purchases products from Trompa and distributes them to music stores across the country. What kind of intermediary function does Yes Music perform for Trompa?

Managerial

Facilitating

Transactional

Logistical

The idea of the __________ describes the phases a new product goes through in the marketplace.

product life cycle

strategic marketing process

new-product process

marketing life cycle

__________ are small, downloadable software programs that work on tablet devices and smartphones.

Algorithms

Apps

Databases

RFIDs

__________ is the combination of benefits such as convenience, quality, and on-time delivery provided to targeted buyers by firms at a particular price.

Customer value

Seller Value

Manufacturer value

Business value

The __________ sells a marketing plan to readers by being clear and direct.

mission statement

executive summary

company description

strategic focus and plan

__________ relate to the effort spent in making sales.

Marketing input data

Marketing outcome data

Observational data

Primary data

What is the difference between a marketing plan and a business plan?

A marketing plan deals with marketing actions, whereas a business plan addresses the entire organization.

A marketing plan contains a description of an organization, whereas a business plan does not contain any description.

A marketing plan contains details on operations, research, and manufacturing, whereas a business plan does not.

A marketing plan addresses the financial projections of an organization, whereas a business plan does not

Darby’s Burgers Ltd. uses the best quality meats in its burgers. However, this fact is not being marketed well to its potential consumers, leading to a decline in sales. There is a growing demand for quality meat products among the health-conscious that could work in Darby’s favor. However, Darby’s must compete with fast-food chains that offer burgers at low prices. Which of the following statements describes Darby’s weakness according to SWOT analysis?

There is a growing demand for quality meat products among the health-conscious.

Darby’s must compete with fast-food chains that offer cheap burgers.

Darby’s quality is not well-marketed or advertised to its potential consumers.

Darby’s uses good quality meats in its burgers.

__________ is the act of using quotas or tariffs to shield one or more industries within a country’s economy from foreign competition.

Commercialism

Centralism

Provincialism

Protectionism

The __________ of the environment include the population and culture’s demographic characteristics.

technological forces

competitive forces

social forces

economic forces

The trade of offerings of value between a buyer and a seller, resulting in mutual benefit, is called a(n) __________.

exchange

advertisement

communication

marketing mix

The shares of Agro Textiles Ltd. are valued lower than its competitors. To increase its value, the company decides to study its current situation and see how it can improve itself. Which of the following strategic marketing processes should be used by Agro to analyze its situation?

Marginal analysis

Break-even analysis

Business portfolio analysis

SWOT analysis

A __________ is when manufacturers direct their promotional efforts toward channel partners to convince them to order and stock products.

multi-marketing strategy

pull strategy

push strategy

skimming strategy

What is the difference between advertising and personal selling?

Advertising is always a paid activity to sell a product, whereas personal selling involves no direct payment to sellers.

Advertising can control the amount of wasted coverage, whereas personal selling cannot control the amount of wasted coverage.

Advertising does not have an immediate feedback loop, whereas personal selling does because of direct interaction with potential consumers.

Advertising uses customized interaction between sellers and potential consumers, whereas personal selling sells to a large group of potential consumers.

__________ is an activity that creates, communicates, and delivers products and services that benefit an organization, its stakeholders, its customers, and society as a whole.

Marketing

Advertising

Purchasing

Manufacturing

What is the difference between primary and secondary data?

Primary data are newly collected facts and figures for a project, whereas secondary data are facts and figures recorded prior to a current project.

Primary data relate to the results of marketing efforts, whereas secondary data relate to the effort spent in making sales.

Primary data relate to the effort spent in making sales, whereas secondary data relate to the results of marketing efforts.

Primary data are facts and figures recorded prior to a current project, whereas secondary data are newly collected facts and figures for a project.

What must an organization use to determine its position respective to the competition during the new-product strategy development stage?

Strategic focus and strategic plan

Promotion and price strategy

Geographic and demographic segmentation

SWOT analysis and environmental scanning

Banana Technologies Inc. operates through brick-and-mortar stores that allow customers to personally check the brand’s computers and ask questions about its products. Upon purchase of any of its computers, the company allows the customers to return to the store for free consultations up to one year while also providing free software upgrades. Which marketing strategy is Banana Technologies Inc. following?

Niche marketing

Digital marketing

Relationship marketing

Guerilla marketing

At the __________ level the top management of a company directs the overall strategy for the whole company.

strategic business unit

functional

human resources

corporate

Which of the following is true of economic development considerations?

A company must understand whether a country has a mixed economy or a more agricultural economy.

A company must weigh the average income of a country’s consumers.

A company must consider a country’s communications, distribution, and transportation systems.

A company must recognize a country’s currency exchange rates and price its products accordingly.

Which of the following is a step in the planning stage of the strategic marketing process?

The implementation phase

The results program

The evaluation phase

The marketing program

__________ segmentation is done according to where potential consumers live or work

Behavioral

Demographic

Psychographic

Geographic

 

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BUS 475 Capstone Final Examination Part 2 BUS 475 FINAL EXAM JUNE 2017

BUS 475 Capstone Final Examination Part 2 BUS 475 FINAL EXAM JUNE 2017

 

 

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BUS 475 Capstone Final Examination Part 2 BUS 475 FINAL EXAM JUNE 2017

BUS 475 Capstone Final Examination Part 2 BUS 475 FINAL EXAM JUNE 2017

A company declared a cash dividend of $8560 on December 5 2015. The company made a cash dividend payment on January 8, 2016. What is the cumulative effect of the declaration and payment of the cash dividend on the company’s financial statements?

  • Total liabilities will remain the same, and total assets will increase by $8,560.
  • Stockholders’ equity and total assets will decrease by $8,560.
  • Stockholders’ equity will increase by $8,560, and total assets will remain the same.
  • Total assets and liabilities will increase by $8,560.

Rilm Corporation has been recording investment income as revenue for the past year with the aim of making the financial condition of the company appear better than it actually is. Jon, one of the company’s employees, becomes aware of this fraudulent activity and immediately reports it to the appropriate authorities. After conducting several investigations, the authorities book the company under the Sarbanes-Oxley Act. Which of the following statements best explains why Jon did not hesitate to alert the authorities about the company’s fraudulent activity?

  • Under the Sarbanes-Oxley Act, whistleblowers who suffer retaliation are allowed to recover criminal damages but not civil damages.
  • The Sarbanes-Oxley Act requires accounting firms to separate their auditing and consulting functions.
  • There are no limitations to the protections offered by the Sarbanes-Oxley Act to whistleblowers.
  • The Sarbanes-Oxley Act provides for the reinstatement of whistleblowers in cases of improper termination.

LaBelle a famous cosmetic brand introduces a new skin cleanser. The product does extremely well and reaps huge profits for the company. After using the product for a few months, consumers complain of rashes and allergies. An external chemical agency accuses the company of using banned substances in its products. When investigated, the company’s CEO confesses that he knew about the substance but did not act because of the product’s initial success. Which of the following could be the cause for the CEO’s unethical behavior?

  • The slippery slope
  • Overvaluing outcomes
  • Indirect blindness
  • Ill-conceived goals

Elena Corporation owes Volmare Inc. an advertising agency a sum of $42000 for services rendered. When Elena Corporation goes public it offers the agency 7000 shares of its common stock in exchange for the payable service cost. The agency accepts the offer. The stock trades at $6 per share and the par value of the stock is $1. Which of the following is the correct journal entry to record this transaction in the books of Elena Corporation?

  • Service Expense                                                                                   42,000

Common Stock                                                                                                42,000

 

  • Cash                                                                                                    42,000

Common Stock                                                                                                42,000

 

  • Service Expense                                                                                   42,000

Paid-in Capital in Excess of Par—Common Stock                                           42,000

 

  • Service Expense                                                                                   42,000

Common Stock                                                                                                 7,000

  • Paid-in Capital in Excess of Par—Common Stock                                              35,000

CoolWindows Corp. produces 2000 air conditioners per week in three plants: Plant I, Plant II, and Plant III. Plant I produces 800 air conditioners per week, Plant II produces 500 air conditioners per week, and Plant III produces 700 air conditioners per week. The probability of an air conditioner being defective is 7% for Plant I, 5% for Plant II, and 6% for Plant III, respectively. In a random check, a defective air conditioner is found. What is the probability that the air conditioner was produced in Plant II?

  • 25
  • 18
  • 20
  • 75

Calculate the expected return for a stock based on the following information.

Expected dividend $2.20
Current price $47.82
Expected growth rate 5.67%
  • 6%
  • 27%
  • 87%
  • 46%

As a common practice Rova Inc. mostly collects upfront payments for goods that will be delivered to customers in the future. Unearned revenues contribute significantly to the company’s current liabilities.

Commentator A: The advance cash received from customers can be used to finance the company’s operations, and the corresponding liabilities that are recorded will appear as sales in future financial statements. Therefore, this practice is beneficial to Rova Inc. and should be continued.

Which of the following statements, if true, weakens commentator A’s argument?

  • Rova Inc.’s ability to deliver exactly as per its commitments to its customers is frequently impacted by its unreliable suppliers.
  • Rova Inc.’s long-term liabilities are not offset by its current assets.
  • Rova Inc.’s cash flow statement shows that the company does not have enough cash to scale up its operations in the next year.
  • A majority of the orders received by Rova Inc. from its customers are for customized products.

The senior management of Reska Corp. realizes the importance of encouraging employees to be creative. In the previous year, the company organized quarterly town hall meetings, where employees were given the opportunity to share innovative ideas to tackle the issues faced by the company and to improve the company’s overall performance. However, this plan did not yield the desired result.

The CEO of Reska Corp.: This plan failed because employees tended to be apprehensive about expressing their ideas in public as they did not know how the ideas would be received. We must change our strategy and give employees the opportunity to express their ideas to their managers in person. This will make the employees feel comfortable expressing their creativity.

Which of the following is assumed by the CEO?

  • Unless the employees of Reska share their creative ideas, the company’s overall performance is unlikely to improve.
  • Employees feel less apprehensive about expressing their ideas to their managers than about expressing them in public.
  • Reska’s employees want to be creative at their jobs.
  • Companies with a creative workforce are less resistant to change than those lacking creativity.

Melanie and Peter are discussing the limitations of internal control systems in organizations. Melanie believes that the human element is an insignificant factor in internal control systems. If Peter wants to refute this view, which of the following points should he put forth?

  • Small companies have more efficient internal control systems as they do not need to segregate duties or provide for independent internal verification.
  • Collusion between two individuals can eliminate the protection offered by segregation of duties in an internal control system.
  • A well-built internal control system has inbuilt controls to reverse the results of employee indifference and carelessness.
  • The size of an organization determines the expectations from an internal control system in the organization. 

Cryser Inc. specializes in manufacturing wind turbines. In order to increase the efficiency of its manufacturing process, the management decides to restructure its shop floor into several workshops. Each workshop specializes in a specific function. The engineers working in the company raise concerns that their jobs will become monotonous if each employee performs only one of those functions. Which of the following is a soft tactic that the management can use to influence the engineers?

  • Convincing the union leader to persuade other engineers
  • Explaining the benefits of the new structure
  • Demanding the engineers to comply with the authority
  • Promising monetary benefits

Jeremia joins as the new marketing manager in a leading multinational company. The company usually advertises its products through newspapers, television, or trade fairs. Jeremia invites different product managers within the company to discuss and find out new ways of creating consumer awareness for the company’s products. Several members of the group are inclined toward Jeremia’s idea of using social media, while others are content with the present promotional strategies. Which of the following stages of the group development process are the managers experiencing?

  • Performing
  • Forming
  • Storming
  • Norming

Vonik Solvers Inc. receives $40,000 in cash by issuing 15,000 shares of common stock at the par value of $2 per share.Which of the following is the correct journal entry to record this transaction?

Cash                                         80,000

Common Stock                                     30,000

Additional Paid-in Capital                       50,000

Common Stock                         40,000

Cash                                                     30,000

Additional Paid-in Capital                        10,000

Cash                                         40,000

Common Stock                                     30,000

Additional Paid-in Capital                       10,000

Common Stock                         80,000

Cash                                                     30,000

Additional Paid-in Capital                        50,000

Cero Inc. is an oil and gas company that operates in the nation of Lumnia. Cero has incurred unforeseen expenses this year because of an environmental lawsuit filed against the company for accidentally causing an oil spill in a marine area in Lumnia. Therefore, despite Cero’s earnings being high, the company’s net income is much lower than what the company anticipated.

CFO of Cero Inc.: Our operations are compliant to the current environmental laws. Accidents such as the oil spill caused by Cero Inc. are extremely rare. Therefore, the consequences of the environmental impacts of our operations should be categorized as nonrecurring costs in our financial statements.

Cero’s shareholder: Cero Inc.’s earnings steadily increase every year. Since the oil spill is a onetime incident, there is no need to worry about its impact on next year’s profits.

Which of the following statements, if true, weakens the CFO’s argument?

  • Cero Inc. categorizes any change in accounting principles as a nonrecurring expense.
  • A change in the taxes applicable to Cero Inc. cannot be listed as a nonrecurring expense unless it is unanticipated.
  • In the future, Lumnia’s environmental laws are likely to undergo frequent changes because of increasing environmental activism in Lumnia.
  • Cero Inc.’s earnings come from many other operations that are based outside Lumnia.

Telda Corp. is a large accounting firm. It has an office in each of the 27 states of Kavenia.

The chairperson of Telda Corp.: I believe that if employees work in the same office for a long time, issues like favoritism, complacency, and misuse of authority are likely to develop. Therefore, I propose a policy that requires at least the employees in managerial positions and above to be transferred to a different office every five years. This policy will be well received by our employees and discourage them from leaving our company.

Which of the following statements, if true, would most seriously weaken the chairperson’s policy?

  • The cost of living in Kavenia varies from state to state.
  • Employees are more likely to switch jobs within their city than to relocate to a new city for their current jobs.
  • The employees of Telda Corp. would have to be paid a relocation allowance if they are transferred to a different city.
  • There is a high rate of attrition among Telda Corp.’s employees who are not in managerial positions. 

The HR manager of Delta Corp.: According to our rewards and recognition program, employee achievements are acknowledged and employees are given gift vouchers through emails on reaching milestones and targets. I feel this is not enough to make employees feel appreciated. In my previous company, work anniversaries and professional achievements were celebrated in organization-wide meetings, where the concerned employee would be publicly rewarded. After all, I would love it if my efforts were recognized like this! Therefore, such an idea would be a great success in our company. 

The HR manager’s argument is flawed because it:

  • dismisses the possibility of increasing the value of the gift vouchers that are given to the employees at present.
  • fails to prove that employees of Delta Corp. feel unappreciated.
  • fails to recognize the effort put in by his team to implement the existing rewards and recognition program.
  • fails to consider that other people might perceive appreciation differently than him.

The management team at Cryser Inc., manufacturer of wind turbines, aims to increase the company’s market share by 20% by the end of 2017. The respective functional heads in the company inform their teams that they will get a substantial bonus if they are able to achieve this target. Which of the following stages of the goal-setting process is the company in?

  • Providing support and feedback
  • Creating action plans
  • Promoting goal commitment
  • Setting goals

calculate the cash flows from investing activities based on the following information.

Cash received from customers $67,550
Cash paid to suppliers 24,000
Purchase of equipment 230,000
Income tax paid 2,800
Payment of dividends 115,000
Proceeds from sale of machinery 105,000
Interest paid 1,500
Proceeds from issue of long-term debt 84,000
Purchase of stocks 87,500
Receipts from sale of equity instruments 177,300
  • $(35,200)
  • $39,250
  • $(31,000)
  • $125,000

Raubac Inc. has an earnings before interest and taxes (EBIT) of $350,000. Raubac Inc.’s capital structure consists of a long-term debt of $950,000 (costing 4%) and 110,000 issued shares of common stock at a market price of $6 per share. To bring down Raubac’s dependence on debt, the company is planning to reduce its debt by $200,000 by selling additional shares of common stock. Raubac’s EBIT will not change with the change in capital structure and will remain in the 40 percent tax bracket. Which of the following is a result of the change in Raubac’s capital structure?

  • Raubac’s earnings before taxes (EBT) will remain unchanged.
  • Raubac’s earnings per share (EPS) will increase by $0.57.
  • Raubac’s earnings before taxes (EBT) will reduce by $8,000.
  • Raubac’s net income will increase by $4,800.

The management team at Cryser Electronics Inc., manufacturer of electrical generators, aims to increase the company’s market share by 20% by the end of 2017. To achieve this target, Marcus, the marketing manager, assigns specific sales targets to individual salespeople and retailers. In this scenario, the sales target is a(n) __________.

  • behavioral goal
  • project goal
  • task goal
  • objective goal

The CEO of Wrenn Corporation is convicted of committing accounting fraud. After several in-depth investigations, it is found that although the CEO of the company was not aware of the fraud, he received 1.5 million dollars in the form of bonuses and stock profits during the company’s fraudulent period. The Securities and Exchange Commission orders the company to restate its financial position and furnish the correct financial statements. As per the Sarbanes-Oxley Act, which of the following is a likely consequence that will follow?

  • The CEO will be held personally liable for the company’s misconduct during the fraudulent period.
  • The CEO will be asked to return the money that he or she received during the company’s fraudulent period.
  • The company will be allowed to grant personal loans to its executives provided that it can prove the creditworthiness of the executives.
  • The company will be asked to merge its auditing and consulting functions.

Calculate the cash flows from financing activities based on the information given below.

Depreciation $ 770
Purchase of machinery 4,000
Increase in fixed asset 900
Payment of dividend 600
Issuance of short-term debt 1,500
Repayment of long-term debt 5,700
Increase in bank borrowings 6,200

 

  • $1,400
  • $630
  • $2,000
  • $4,130

Calculate the net income of Tinekal Corporation from the following information.

Depreciation expense $ 850
Rent expense 500
Salaries expense 700
Supplies expense 650
Interest expense 400
Revenue from sales 5,000
Profit from sale of assets 1,000
Dividend 700

 

  • $2,600
  • $3,600
  • $2,900
  • $1,900

Omega Corp. released the unaudited financial statement prepared by its accountants. According to the statement, the profit margin of the company has increased. The sales of its electronic appliances have also increased. Based on the unaudited financial statement, buying Omega Corp. shares would be a good investment.

 

Which of the following, if true, casts the most doubt on the conclusion?

  • Omega Corp. does not maintain more than a month’s supply of inventory.
  • The sales of other products of Omega Corp. have not shown the increase that the sales of electronic appliances have shown.
  • The earnings reported in the audited financial statement for Omega Corp. are lower than that reported in the unaudited financial statement.
  • The fixed expenses of the company have increased significantly.

 

BrightLife, a leading insurance company, provides incentives to salespeople based on the number of prospective customers they meet in a day. The salespeople, however, often spend time with their friends and then claim to have met the prospective customers. They are paid incentives based on their claims. The company’s CEO realizes that the number of customers the company has is significantly less compared to the number of prospective customers that the salespeople claim to have met. To rectify the unethical behavior of the salespeople, the company now pays incentives based on the number of sales each person makes. Which of the following could be a cause for the salespeople’s unethical behavior?

Motivated blindness

Indirect blindness

Ill-conceived goals

Maertge Airlines purchases an aircraft for $84,000,000 on January 1, 2016. The residual value of the aircraft is estimated at $7,500,000, and its useful life is estimated at 25 years. Applying the double-declining-balance method of depreciation, the depreciation expense recognized for the year ended December 31, 2018 will be __________.

  • $6,182,400
  • $3,096,576
  • $5,687,808
  • $6,720,000

Luisana runs a clothing boutique that sells designer clothes. In order to expand the clothing collection in the boutique, Luisana wants to buy some clothes from a fashion designer. After examining Luisana’s audited financial statements, the fashion designer concludes that she is assured a collection from Luisana.

 

Which of the following statements will weaken the argument?

  • The fashion designer makes her collections within two months of sale.
  • Luisana’s liquid assets are just enough to meet her current liabilities.
  • Luisana’s boutique faces increased competition from other designer boutiques.
  • Luisana has owned the boutique for only three years and has no prior experience of running a business.

WarmLiquid Corp., a manufacturer of water heaters, produces 30 water heaters per week. Past records indicate that 10% of total water heaters produced in a week are likely to be defective. Suppose a quality check was conducted on a sample of six water heaters. What is the probability that four out of six water heaters will be defective?

0.08

0.56

0.46

0.76
In an apparel store, one individual is assigned the task of recording the cash received from customers. Another individual is responsible for the creation and handing over of credit memos to customers. These measures are taken to avoid the risk of fraud. Which of the following principles of internal control activities does this scenario best illustrate?

  • Physical controls
  • Documentation procedures
  • Segregation of duties
  • Independent internal verification

Gharial LLC is a company that manufactures and leases cars. To increase its production capacity, the CEO of Gharial LLC has decided to build a new manufacturing plant. The company requires a loan from a bank, and submits its financial statements to the bank. The CEO believes that the loan will be approved because of the company’s liquidity.

 

Which of the following strengthens the CEO’s argument?

  • The cost of building the manufacturing plant will be offset by the profit Gharial LLC earns.
  • Gharial LLC’s financial statements show a positive working capital.
  • The manufacturing plant will be amortized over the next thirty years.
  • Gharial LLC’s earnings per share are equal to that of other similar companies.

 

Telda Corp. is a large accounting firm. It has an office in each of the 27 states of Kavenia.

 

The chairperson of Telda Corp.: I believe that if employees work in the same office for a long time, issues like favoritism, complacency, and misuse of authority are likely to develop. Therefore, I propose a policy that requires at least the employees in managerial positions and above to be transferred to a different office every five years. This policy will be well received by our employees and discourage them from leaving our company.

 

 

Which of the following statements, if true, would strengthen the chairperson’s argument?

  • Cultural differences may lead to different working styles in the different office locations of Telda Corp.
  • Introducing policy changes without consulting the relevant stakeholders is against the work culture of Telda Corp.
  • The technical skills required to work vary from team to team in Telda.
  • Rotating employees among different office locations leads to greater employee cohesion in companies.

Secaucuss Co. has been in the business of manufacturing office supplies for the last five years. Recently, the company issued more shares to the public to raise capital for its expansion. Expanding its operations into office maintenance helped it generate additional cash inflows. Since the company expanded and issued more shares, the stockholders’ equity should also have increased. However, the stockholders’ equity went down this year.

 

Which of the following statements best explains why the stockholders’ equity went down?

  • The company purchased some new machines to speed up its manufacturing process.
  • The company employed a predatory pricing strategy to increase its market share.
  • The company collected revenue from services provided on an accrual basis.
  • The company declared a 2-for-1 stock split during the current year.

Reinek Company sold a fixed asset for $25,000. The asset was originally purchased at a cost of $64,000. On the date of sale, the accumulated depreciation was $53,000. Calculate the gain or loss on the sale of the asset.

Loss of $39,000

Gain of $14,000

Loss of $36,000

Gain of $25,000

Cardice Services Inc. employs more than 5,000 telephone operators globally to address customer complaints. To improve the response time for addressing these complaints, the management decides to automate the responses to all the frequently asked queries. The management predicts that at least 60% of the customer queries will be resolved without the need for human intervention. If the company implements the process, at least 2,500 telephone operators will lose their jobs. To oppose the management’s decision all the employees threaten go on an indefinite strike. Which of the following contingency approaches is commonly used to overcome resistance in such situations?

  • Explicit coercion
  • Facilitation and support
  • Participation and involvement
  • Negotiation and agreement

From the information given below, calculate the net cash flows from operating activities using the indirect method.

Net income $170,000
Depreciation 5,750
Loss on disposal of plant asset 4,000
Increase in inventory 7,500
Increase in prepaid expenses 5,460
Decrease in accounts payable 6,750
  • $160,040
  • $152,040
  • $173,540
  • $176,460

Elanke, an owner of a restaurant, has the following financial information for the year ending December 31, 2016.

 

Revenue earned $410,000
Cash received from customers 300,000
Expenses incurred in the purchase of ingredients 250,000
Depreciation incurred during the year 700
Cash paid for miscellaneous expenses incurred in the year 2015 120,000

 

 

Based on the accrual basis of accounting, Elanke’s net income for the year is __________.

  • $159,300
  • $39,300
  • $339,300
  • $459,300

A company issues 100,000 shares at $50 per share. It has a debt-equity ratio of 2:1. If the company announces a 3-for-1 stock split, what will be the result?

  • The total stockholder’s equity will increase and the debt-equity ratio will decrease.
  • The total stockholder’s equity will decrease and the debt-equity ratio will remain unchanged.
  • The total stockholder’s equity and the debt-equity ratio will decrease.
  • The total stockholders’ equity and the debt-equity ratio will remain unchanged.

Calculate the operating profit or (loss) from the information given below.

 

Sales revenue $320,000
Sales returns 11,000
Cost of goods sold 210,000
Selling expense 23,520
Administrative expense 46,270
Marketing expense 26,880
Research and development 6,300

 

  • ($3,970)
  • $3,970
  • $7,030
  • ($7,030)

The HR manager of Delta Corp.: According to our rewards and recognition program, employee achievements are acknowledged and employees are given gift vouchers through emails on reaching milestones and targets. I feel this is not enough to make employees feel appreciated. In my previous company, work anniversaries and professional achievements were celebrated in organization-wide meetings, where the concerned employee would be publicly rewarded. After all, I would love it if my efforts were recognized like this! Therefore, such an idea would be a great success in our company.

 

Which of the following statements, if true, weakens the HR manager’s argument?

The HR manager of Delta Corp.: According to our rewards and recognition program, employee achievements are acknowledged and employees are given gift vouchers through emails on reaching milestones and targets. I feel this is not enough to make employees feel appreciated. In my previous company, work anniversaries and professional achievements were celebrated in organization-wide meetings, where the concerned employee would be publicly rewarded. After all, I would love it if my efforts were recognized like this! Therefore, such an idea would be a great success in our company.

  • Employees are not motivated to perform well at their jobs if their work is not appreciated and rewarded.
  • The HR manager’s previous company did not offer promotions to its employees easily.
  • Delta Corp.’s policy requires the CEO of the company to be present in every town hall.
  • Delta Corp. does not have sufficient funds to organize frequent town halls.

Calculate the cost of goods sold based on the following information.

 

Inventory at the beginning of 2016 $ 54,000
Purchases 450,000
Purchase returns 12,800
Inventory at the end of 2016 60,000

 

  • $443,200
  • $431,200
  • $491,200
  • $444,000

Earnings per share (EPS) is an indicator of a company’s profitability and how its stocks are valued. EPS of a company is directly proportional to its net income. The net income of Tolut Inc. for this year has decreased by 10 percent from last year’s figures. Therefore, the company’s EPS would be less than what it was last year.

 

Which of the following statements, if true, strengthens the argument?

  • Tolut Inc.’s stocks were undervalued in the market last year.
  • A high EPS indicates that the company has a high potential for growth in the future.
  • Tolut Inc. has issued additional common shares in the current year.
  • Earnings per share do not necessarily fall every time there is a rise in the taxes paid by the company.

Raetal Inc. acquired 2,000 shares of its own stock of par value $1 for $20 per share. Which of the following is the correct journal entry to record this transaction?

Treasury Stock                                  40,000

Cash                                                     40,000

Treasury Stock                                    2,000

Common Stock                                       2,000

Treasury Stock                                    2,000

Cash                                                       2,000

Cash                                                  40,000

Treasury Stock                                      40,000
Leadership roles require the display of classic extrovert behavior such as speaking confidently in public, building large social networks, and allowing your successes as well as failures to be scrutinized by your stakeholders. These abilities are so integral to leadership roles that people who step into such roles learn to master extrovert behavior regardless of their actual personalities.

 

Which of the following can be inferred from the given passage?

  • One can acquire extrovert behavior by becoming a leader.
  • Having large social networks helps in the development of public-speaking skills.
  • Leaders should learn from both their successes and their failures.
  • People who are extroverted become successful leaders.

Janet works as a senior software developer in a multinational IT firm. She prefers to work as an individual contributor and volunteers to work on challenging projects. The firm encourages Janet and other people like her by assigning them to projects that require a great deal of innovation. The firm motivates Janet by appealing to her need for __________.

  • power
  • security
  • achievement
  • affiliation

Calculate the revenue for the year ending December 31, 2016, based on the information given below.

 

2016 2017
Retained earnings, January 1 $14,500          $       X
Revenue for the year Y 48,500
Expenses for the year 44,800 42,700
Dividends paid 3,500 5,700

 

The ending balance of retained earnings on December 31, 2017, is $18,500.

  • $15,400
  • $52,200
  • $18,400
  • $33,800

The board of directors of Yudel Corp. is looking for a new managing director for the company. They find a candidate, Linda, who is hardworking, passionate, and confident. These are the characteristics that all the past leaders of Yudel Corp. had in common. Therefore, the board concludes that hiring Linda as the new managing director will contribute positively to the company’s success.

 

The board of directors relies on the assumption that:

  • Linda has worked in companies similar to Yudel Corp. in the past.
  • the leaders of other companies have characteristics in common with the leaders of Yudel Corp.
  • Linda will not have any other job offer to consider when Yudel Corp. offers her the position of managing director.
  • Linda’s goals, as a leader, are compatible with the culture and vision of Yudel Corp.

Financial analyst: Linksus Tech is a company that manufactures drill bits and screwdrivers. Over the last year, its sales have not shown a significant increase. The company has a large quantity of inventory on hand, its accounts receivable have doubled, and its accounts payable have increased threefold. Given this, the company should try to realize its current assets at the earliest to stay afloat.   

 

Which of the following, if true, would strengthen the argument?

  • Linksus Tech has applied for a short-term loan to meet its working capital requirements.
  • The current liabilities are expected to be due within the next three months.
  • The demand for the products sold by the company is expected to increase.
  • The company will introduce a much-awaited new product into the market in the following year.

Neha is a communications manager in a reputed software company. She firmly believes that men do not prefer working with women supervisors because they think women are inferior to them. Jordon is Neha’s manager and elder to her by 10 years. Every time Neha interacts with Jordon, she downplays her dominant nature by acting naive. However, she is aggressive and dominant with younger employees. Which of the following approaches to managing diversity should be used to help Neha overcome her prejudiced attitude?

  • Educating Neha about stereotyping people of different age and sex
  • Isolating Neha by putting her in special projects that require minimum interaction with other employees
  • Acknowledging Neha’s beliefs but not valuing or accepting them
  • Hiring more women employees to create an environment that is more diverse

Aaron has recently been recruited as the managing director of Ikara Corp., which is a leading accounting firm with a global presence. He learns that the employees of Ikara felt that the previous managing director was unapproachable and did not encourage employees to express their problems or ideas to him. Aaron does not want to be perceived the same way. To appear friendlier toward his employees, he decides to use a bit of humor in his electronic communication. This will surely enable him to build a good rapport with the employees of Ikara Corp.

 

Which of the following, if true, most seriously undermines Aaron’s argument?

  • Aaron has previously worked in companies where communication between employees was informal.
  • Aaron’s electronic communication is mostly directed to the senior management of the company.
  • Managers must seem approachable to their teams, especially when their teams are spread across the globe.
  • Some employees of Ikara belong to cultures where humor is likely to be perceived as ridicule.

Gharial LLC is a company that manufactures and leases cars. To increase its production capacity, the CEO of Gharial LLC has decided to build a new manufacturing plant. The company requires a loan from a bank, and submits its financial statements to the bank. The CEO believes that the loan will be approved because of the company’s liquidity. 

Which of the following, if true, weakens the CEO’s argument?

 

  • The price of Gharial LLC’s shares has remained constant over the past year.
  • Gharial LLC specializes in high-end cars.
  • The current ratio of Gharial LLC is higher than one.
  • A majority of Gharial LLC’s current assets are in the form of inventory.

CodeGiant Inc. is a startup company that specializes in software development. The government levies a sales tax of 7.5% on the sale of the company’s services. Mathew, the company’s CTO, decides to introduce a new functional structure that will reduce the time taken to develop each software. He believes that this will reduce the company’s costs and compensate for the taxes. When he presents his idea to the company’s investors, they become apprehensive that such changes may lead to internal conflicts. The respective department heads are also apprehensive because they do not know whether they will fit into the new structure. They question the validity of Mathew’s suggestion. Which of the following stages of the group development process does this scenario portray?

  • Adjourning
  • Norming
  • Storming
  • Forming