This quiz works best with JavaScript enabled. Home > Accounting > International Accounting > International Accounting – Quiz 4 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books International Accounting Quiz 4 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which one of the following is NOT an advantage of Activity-Based-Budgeting (ABB)? A) Better identification of resource needs. B) Linking of costs to outputs (e.g. products). C) Identification of budgetary slack. D) Reduction of planning uncertainty. E) Reduction of budgetary slack. Show Answer Correct Answer: D) Reduction of planning uncertainty. 2. Where is the world's largest Equity market A) Americas. B) Asia. C) Western Europe. D) None of above. Show Answer Correct Answer: A) Americas. 3. The performance measure(s) that induce a desirable expansion of an organisation unit as long as it earns a rate of return in excess of Weighted Average Costs of Capital (WACC) include:I:Return on Investment (ROI)II:Residual Income (RI)III:Return on Sales (ROS) A) I only. B) II only. C) I and II. D) I, II and III. E) II and III. Show Answer Correct Answer: B) II only. 4. MicroBrew Northwest is a successful brewery engaged in the development and production of specialty micro brews. It uses an activity-based costing system. During the past year, it has incurred $ 1, 250, 000 of product development (design) costs, $ 850, 000 of materials handling costs, $ 2, 500, 000 of production line labor costs, $ 700, 000 for production set up costs and $ 1, 500, 000 for manufacturing facility management. The ABC cost hierarchy is as follows:output unit-level costs, batch level costs, product-sustaining costs and facility-sustaining costs.In an ABC cost hierarchy, A) $ 1, 250, 000 are product sustaining and $ 1, 500, 000 are batch level costs. B) 3, 350, 000 are output unit-level and $ 1, 200, 000 are batch-level costs. C) $ 1, 250, 000 are product sustaining costs and $ 700, 000 are batch level costs. D) $ 1, 500, 000 are facility sustaining costs and $ 850, 000 are output unit-level costs. E) All statements are false. Show Answer Correct Answer: C) $ 1, 250, 000 are product sustaining costs and $ 700, 000 are batch level costs. 5. Management Control systems help to keep companies focused in the proper direction. These control systems consist of the following basic components: A) Budgeting, financial ratio analysis and cash management. B) Strategic planning, budgeting, measurement and reporting and an evaluation system. C) Role analysis, team building and survey feedback. D) Coaching, protection and challenging assignments. E) Strategic planning, budgeting and reward system. Show Answer Correct Answer: B) Strategic planning, budgeting, measurement and reporting and an evaluation system. 6. To reduce differences (diversities) is called A) FDI. B) GAAP. C) Harmonization. D) IFRS. Show Answer Correct Answer: C) Harmonization. 7. Generally, in a highly decentralized organisation the best option for measuring the performance of divisions (business units) is the establishment of A) Investment centers. B) Profit centers. C) Revenue centers. D) Discretionary expense centers. E) Engineered expense centers. Show Answer Correct Answer: A) Investment centers. 8. What does "harmonization" mean in the context of international accounting? A) The process of combining the financial statements of foreign subsidiaries into the parent company's financial statements. B) Reducing the diversity of accounting standards. C) Disclosing the accounting methods used in preparing the financial statements. D) Assessing the exposure resulting from inadequate internal controls. Show Answer Correct Answer: B) Reducing the diversity of accounting standards. 9. Which of the following is found in a Mexican income statement in the "Comprehensive Financing Result" section? A) The depreciation expense on capital leases. B) Purchasing power gain or loss during inflationary periods. C) Income taxes. D) Operating lease rent expense. Show Answer Correct Answer: B) Purchasing power gain or loss during inflationary periods. 10. The expected value of perfect information is: A) Same as the expected profit under uncertainty. B) Sum of the conditional profit (loss) for the best event of each act times the probability of each event occuring. C) Difference between the expected profit under uncertainty and the expected opportunity loss. D) Difference between the expected profit under certainty and the expected monetary value of the best act under uncertainty. Show Answer Correct Answer: D) Difference between the expected profit under certainty and the expected monetary value of the best act under uncertainty. 11. Which of them are not Locally brand car A) Proton. B) Toyota. C) Perodua. D) Am. Show Answer Correct Answer: B) Toyota. 12. Normal spoilage and abnormal spoilage should be classified as A) Normal:period costabnormal:period cost. B) Normal:product costabnormal:period cost. C) Normal:period costabnormal:product cost. D) Normal:product costabnormal:product cost. E) Normal:product costabnormal:extraordinary cost. Show Answer Correct Answer: B) Normal:product costabnormal:period cost. 13. What is the term used to refer to creating one set of financial accounting standards throughout the world? A) GAAP. B) Transfer pricing. C) Consolidation. D) Harmonization. Show Answer Correct Answer: D) Harmonization. 14. In which year are Indian Accounting Standards in line with IFRS? A) 1973. B) 1977. C) 2001. D) 2011. Show Answer Correct Answer: D) 2011. 15. In situations when management must decide on accepting or rejecting one-time-only special orders, where there is sufficient idle capacity, which one of the following is NOT relevant to the decision? A) Absorption costs. B) Differential costs. C) Incremental costs. D) Direct costs. E) Variable costs. Show Answer Correct Answer: A) Absorption costs. 16. The starting point (foundation) of a Master Budget is the A) Capital budget. B) Sales budget. C) Cost (expense) budget. D) Production plan. E) Cash budget. Show Answer Correct Answer: B) Sales budget. 17. As used in international accounting, a "hedge" is: A) A business transaction made to reduce the exposure of foreign exchange risk. B) The legal barrier between the various divisions of a multinational company. C) The loss in US$ resulting from a decline in the value of the US$ relative to foreign currencies. D) One form of foreign direct investment. Show Answer Correct Answer: A) A business transaction made to reduce the exposure of foreign exchange risk. 18. It is generally believed that the 1997 financial crisis in East Asia was partly due to accounting factors in that part of the world. Which of the following accounting values was lacking in that part of the world, and thereby contributed to the crisis? A) Professionalism. B) Statutory control. C) Uniformity. D) Transparency. Show Answer Correct Answer: D) Transparency. 19. The Hersh Company uses a performance reporting system that reflects the company's decentralization of decision making. The departmental performance report shows one line of data for each subordinate who reports to the group vice-president. The data presented show the actual costs incurred during the period, the budgeted costs and all variances from budget for that subordinate's department. The Hersch Company is using a type of system called A) Cost benefit accounting. B) Flexible budgeting. C) Program budgeting. D) Responsibility accounting. E) Activity-based costing system. Show Answer Correct Answer: D) Responsibility accounting. 20. Under a job order product costing system, the dollar amount of the journal entry involved in the transfer of inventory from Work in Process to Finished Goods is the sum of the costs charged to all jobs A) Started in process during the period. B) In process during the period. C) Completed and sold during the period. D) Completed during the period. E) Started, completed and sold during the period. Show Answer Correct Answer: D) Completed during the period. ← PreviousNext →Related QuizzesAccounting QuizzesInternational Accounting Quiz 1International Accounting Quiz 2International Accounting Quiz 3International Accounting Quiz 5International Accounting Quiz 6International Accounting Quiz 7International Accounting Quiz 8International Accounting Quiz 9International Accounting Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books