Activity Based Costing process

Activity Based Costing process

Key limitation of ROI

 

·         does not take risk into consideration

 

The logic underlying the three-horizons theory of growth in strategy development is that

 

·         a portfolio of initiatives can generate income and allow exploration of opportunities over time

 

Economics is the social science of how individuals, institutions and society make choices. Which of the following is an ever present constraint that underlies all of these economic choices?

 

·         scarcity

 

What should occur in the project turnover phase?

 

·         The project leader should confirm client acceptance of deliverables or recognition of the fulfillment of project objectives.

 

How to calculate how much cash flow is available to distribute in dividends?

 

·         OCF - CapEx

 

What factors does the risk formula used by the U.S. Federal Emergency Management Agency (FEMA) include?

 

·         asset value, threat rating, vulnerability rating

 

Metric

 

·         A measurement value or range that quantifies a particular attribute, such as desired financial or operational performance (e.g., return on investment or effectiveness of a sales staff)

 

Which of the following statements concerning Economic Value Added (EVA®) is accurate

 

·         EVA is based on the assumption that value is created only if the organization earns a rate of return that exceeds its cost of capital.

 

The technology industry research group Gartner uses a "magic quadrant" to

 

·         categorize key competitors in an industry.

 

What is the purpose of a headcount analysis?

 

·         Projecting ability to staff key job groups

 

A key advantage in categorizing employees by profit and cost centers is that it

 

·         simplifies staff budgeting

 

What is one area of involvement in the financial close for FP&A professionals?

 

·         Analyzing reserves and accruals for adequacy

 

Which of the following best defines the concept of a strategy?

 

·         How an organization creates and sustains competitive advantage

 

T/F: GAAP and IFRS both follow the matching principle

 

·         FALSE, IFRS does not

 

At what point should a financial model development or change log be used to start recording changes or development notes?

 

·         once sufficiently stable

 

formula for price elasticity of supply

 

·         % change in quantity supplied / % change in price

 

Which of the following is a key advantage of real options over alternate risk analysis methods such as NPV?

 

·         Real options can evaluate the risks of changing course in response to changing circumstances

 

Which of the following is a key advantage of real options over alternate risk analysis methods such as NPV?

 

·         Real options can evaluate the risks of changing course in response to changing circumstances

 

What should one do when calculating external cost of funds in a worksheet?

 

·         disable iterative calculations until ready to calculate final result

 

What is true about ratings from credit rating agencies?

 

·         Ratings are based on quantitative and qualitative data

 

One of the problems with staffing according to a static budget is that

 

·         it limits management response during unanticipated business downturns

 

Activity Based Costing process

 

·         assign activities to product
2. cost drivers to activities
3. allocation rates to cost drivers

 

One of the benefits of presenting data in a graph rather than a worksheet is that

 

·         it creates a stronger visual memory of the data points

 

what are the components of EVA calculation?

 

·         NOPAT = EBIT x (1-T) = EBI

average capital employed (ST debt + LT debt + equity)

WACC

DON"T FORGET TO AVERAGE ON B/S SIDE