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WorksheetsBusiness Essentials Unit 4-Test
Total questions: 50
Worksheet time: 3hrs 30mins
The process of keeping the financial records of a business is known as
accounting.
controlling.
financing.
bookkeeping.
The overall purpose of accounting is to
maintain accurate reports.
compile the business’s expenses.
keep track of sales.
control the finances of the business.
Why are accurate accounting records important to a business?
They prevent any financial losses.
They show the business how it is doing.
They increase the return on investments.
They give the business an image of success.
Which of the following groups makes regular use of a business’s managerial accounting information:
Managers
Customers
Creditors
Investors
A creditor is most likely to examine a business’s financial accounting records if the business is
applying for a bank loan.
selecting a new market.
using cash accounting.
complying with regulations.
For an accounting system to be useful to the business, the accounting information it contains must be
accurate and up to date.
approved by the chief executive officer.
posted by an accountant.
recorded using the accrual method.
Which of the following is a requirement for a good accounting system:
It should be updated annually.
It should provide needed information quickly.
It should eliminate the need for an accountant.
It should be replaced every two or three years.
Two employees used a business’s computerized accounting system to change some records. They were able to steal $50,000 from the business because the accounting system lacked which of the following:
Protection from theft and fraud
An affordable price
A manual system as backup
Printed financial statements
Checks, receipts, invoices, and purchase orders are examples of
financial statements.
department ledgers.
source documents.
accounting standards.
What type of accounting method would most likely be used by a large business that has a large number of outstanding loans and customer charge accounts?
Check method
Cash method
COD method
Accrual method
Accounting records for a business show that the week’s total sales revenues were $125,000. Cash sales accounted for $50,000 and credit sales, $75,000. This is an example of
classifying financial information.
the cash accounting method.
an income statement.
the accrual method of accounting.
Which of the following presents the first three steps in the accounting cycle in the correct order:
Post, analyze, and journalize
Analyze, post, and journalize
Analyze, journalize, and post
Post, journalize, and analyze
Which of the following makes comparisons of the financial conditions at multiple organizations possible:
Bookkeeping
Source documents
Accounting standards
Trial balance
Which of the following categories of information are found on a balance sheet:
Income, expenditures, profit
Assets, liabilities, owner’s equity
Assets, liabilities, margin
Revenues, expenses, profit
A bank denies a business owner’s application for credit saying, “We feel that you would be unable to make the monthly payments because of your other debts.” What financial report did the bank review?
Budget
Balance sheet
Income statement
Operating budget
What accounting record would summarize a business’s profit or loss for a previous year?
Bank statement
Inventory record
Income statement
Balance sheet
Which of the following financial reports provides estimates of when, where, and how much money will come into and out of a business next year:
Balance sheet
Cash flow statement
Income statement
Bank statement
The goals of the finance function are to ensure profitability and
advertise products.
manufacture raw materials.
give out information
reduce risks.
Accounting is distinct from finance because its main focus is on
recordkeeping activities.
money management decisions.
administration of assets.
acquisition of funds.
The administration of assets refers to decisions about
accounting.
spending.
investments.
financing.
Decisions about financing refer to the
accounts receivable.
acquisition of funds.
administration of assets.
accounting department.
How does the finance function relate to company spending?
It plans and controls spending.
It produces reports about spending.
It spends on investments only.
It does not relate to spending.
Money the business owes is known as
equity.
assets.
accounts payable.
accounts receivable.
To keep communication flowing with other departments, the finance function depends on
accounts receivable.
information systems.
marketing.
production.
The finance function is usually responsible for which of the following processes:
Budgeting
Manufacturing
Operations
Research
The finance function would definitely be involved in a decision regarding
public relations and publicity.
personal selling.
new business projects and strategies.
hiring.
Which of the following is a capital investment decision:
How to manage cash flow
How to handle accounts payable
How to finance investments
How to manage inventory
A company’s current balance of assets and liabilities falls under the focus of
return on capital.
working capital management.
capital investment decisions.
the cash conversion cycle.
Determining which projects a business should invest in is known as
return on capital.
the cash conversion cycle.
capital structuring.
capital budgeting.
Selling shares in the company to raise money for a new venture is referred to as ___________ funding.
equity
dividend
debt
accounts payable
Which of the following is a key component of managing working capital:
Financing
Capital budgeting
Cash conversion cycle
Capital structure
The cash conversion cycle should be
at equilibrium.
as short as possible.
as long as possible.
on an upward trend.
When return on capital is positive, the company is
growing in value.
losing value.
low on cash.
paying out dividends.
Marketing links producers to
distributors.
retailers.
marketers.
customers.
Marketing is described as creating
exchanges.
needs.
advertisements.
gaps.
Which of the following is a marketing activity:
Balancing customer needs with wants
Leading a project team
Communicating with customers
Lowering operational expenses
What provides the basis for all marketing goals and actions?
Pricing
Planning
Budgeting
Retailing
Which of the following influences the process of determining price:
Customers’ perception of value
Publicity
Purchase location
Sales promotion
Which of the following is a method used to communicate with customers:
Personal selling
Manufacturing
Customer orientation
Marketing concept
The purpose of communicating with customers is to
gather participants for a survey.
befriend customers.
determine prices.
attract customers’ interest.
In an overall sense, where does marketing occur?
Wherever advertisements are
Wherever stores are
Wherever businesses are
Wherever customers are
Of the following, which is a durable good:
Coffee mug
Insect repellent
Hamburger
Lip balm
Which of the following activities is an aspect of marketing a service:
Finding out customers’ favorite coffee flavors
Determining how much to charge for a haircut
Offering a new, improved cell phone
Advertising the state of Michigan on television
In the marketing concept, whose point of view matters most?
Seller’s
Buyer’s
Marketer’s
Planner’s
According to the marketing concept, which option demonstrates customer orientation?
Convincing a buyer to buy
Researching a firm’s competitors
Finding out what a buyer wants
Advertising the features of a product
According to the marketing concept, which option shows company commitment?
Leaving marketing to the marketing department
Teaching marketing to college marketing students
Setting aside funds to research what customers want
Pricing a product to maximize profitability per item
According to the marketing concept, keeping company goals in mind means
making product prices low.
containing marketing costs.
putting marketing second to other company goals.
maintaining the firm’s purpose.
Overall, what does marketing allow us to do?
Stop buying online
Live our daily lives
Feel better about shopping
Limit our spending
Which of the following is the most common reason for businesses to search for ways to make their products better and cheaper:
Competition
Publicity
E-commerce
Service marketing
Marketing encourages people from different countries to __________ frequently.
travel
train
think
trade
