FINANCE 44

Chapter 10

1. Expenses relates primarily to the costs of the various top management

functions at the headquarters level having to do with overall policy
determination and direction of the business.
A. General and Administrative Expenses
B. Overhead
C. Direct Labor
D. Direct Material

2. The typical medium-to large-size company would include the costs of these
departments in the General and Administrative Expenses category:
A. Office of the Chairman of the Board
B. Office of the President
C. Financial Organization
D. All of the Above

3. Expenses that are in some ways unique to headquarters or central unit

activities and that are not found charged to most departments.
A. Unique Expenses C. Incentive Pay
B. Charitable Contributions D. Audit Fees

4. It is being directly related to borrow funds, is kept within limits through the
control of business indebtedness.
A. Interest Expenses C. Legal Fees
B. Income Taxes D. Audit Fees

5. Obviously this loss is not the sole criterion of the efficiency of the credit
department
A. Bad Debt Losses C. Legal Fees
B. Interest Expense D. Audit Fees

6. This criterion is to be used where the cash sales are relatively insignificant.
A. Percentage of Bad Debt Losses to Total Sales
B. Percentage of Bad Debt Losses to Total Net Credit Sales
C. Both A and B
D. None of the above
7. What is the first step in setting standards to the measurement of the clerical-
work?
A. Selection of functions on which standards are to be set
B. Determination of the best method and setting of the standard
C. Testing the standard
D. Preliminary observation and analysis

8. What is the second step in setting standards to the measurement of the

clerical-work?
A. Determination of the best method and setting of the standard
B. Preliminary observation and analysis
C. Testing the standard
D. Selection of functions on which standards are to be set

9. What is the third step in setting standards to the measurement of the clerical-
work?
A. Preliminary observation and analysis
B. Selection of functions on which standards are to be set
C. Testing the standard
D. Determination of the unit of work

10. What is the fourth step in setting standards to the measurement of the clerical-
work?
A. Preliminary observation and analysis
B. Selection of functions on which standards are to be set
C. Determination of the unit of work
D. Determination of the best method and setting of standard

11. After the standard has been set, it should be tested to see that it is practical.
A. Preliminary observation and analysis
B. Selection of functions on which standards are to be set
C. Determination of the unit of work
D. Testing of the standard

12. The costs often are carried as a separate administrative expense until the
property can be disposed of.
A. Excess Facility Costs C. Corporate Expenses
B. Bad Debt Losses D. Legal Fees
 13. These are state and federal capital stock taxes, franchise taxes, fees of fiscal
agents, stock transfer taxes, and fidelity bonds and insurance.
A. Corporate Taxes C. Excess Facility Costs
B. Bad Debt Losses D. Legal Fees

14. The cost of the annual audit by the independent accountants can be estimated,
included in the planned expenses, and accrued.
A. Audit Fees C. Excess Facility Costs
B. Bad Debt Losses D. Legal Fees

15. These are contributions that are approved by the board of directors as a
separate budget item.
A. Charitable Contributions C. Bad Debt Losses
B. Audit Fees D. Legal Fees

KEY TO CORRECTION:

1. A
2. D
3. A
4. A
5. A
6. A
7. D
8. D
9. D
10. D
11. D
12. A
13. A
14. A
15. A