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1. Which of the following will not result in an increase in return on investment (ROI), assuming other factors remain the same?
An increase in operating assets.
A segment of a business responsible for both revenues and expenses would be called
a profit center.
Which of the following costs are always irrelevant in decision making?
The payback method measures:
how quickly investment dollars may be recovered.
. A weakness of the internal rate of return method for screening investment projects is that it:
implicitly assumes that the company is able to reinvest cash flows from the project at the internal rate of return.
17. Which of the following would be classified as a financing activity on the statement of cash flows?
Dividends paid to shareholders of the company on the company's common stock.
An increase in the plant and equipment account of $100,000 over the course of a year would be shown on the company's statement of cash flows prepared under the indirect method as:
a deduction of $100,000 under investing activities.
In a statement of cash flows, a change in the inventories account would be classified as:
an operating activity.
2. Which of the following statements is true?I. Overhead application may be made slowly as a job is worked on.II. Overhead application may be made in a single application at the time of completion of the job.III. Overhead application should be made to any job not completed at year-end in order to properly value the work in process inventory.
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