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Business Peregrine Exam Questions with Correct Answers, Exams of Business Finance

A comprehensive set of business-related exam questions and their corresponding correct answers. It covers a wide range of topics, including accounting principles, financial statements, cost analysis, economic concepts, business strategy, marketing, and corporate governance. The questions are designed to test the understanding of fundamental business concepts and their practical applications. By studying this document, students can gain valuable insights into the key areas of business and prepare themselves for exams or assessments. The document serves as a useful resource for university-level business courses, providing a structured approach to reviewing and reinforcing essential business knowledge.

Typology: Exams

2024/2025

Available from 10/19/2024

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Business Peregrine Exam Questions with Correct Answers
1.What is a general ledger?: A general ledger account is an account or record used to sort, store and summarize a
company's transactions.
asset accounts such as Cash, Accounts Receivable, Inventory, Investments, Land, and Equipment
liability accounts including Notes Payable, Accounts Payable, Accrued Expenses Payable, and Customer Deposits
stockholders' equity accounts such as Common Stock, Retained Earnings, Treasury Stock, and Accumulated Other
Comprehensive Income
2. What is the difference between accounts payable and accounts receivable?-
: Accounts payable is a current liability account in which a company records the amounts it owes to suppliers or
vendors for goods or services that it received on credit.
Accounts receivable is a current asset account in which a company records the amounts it has a right to collect from
customers who received goods or services on credit.
3.What is the cost of goods sold?: The cost of goods sold is the cost of the products that a retailer, distributor,
or manufacturer has sold.
4.What is owner's equity?: Owner's equity is one of the three main sections of a sole proprietorship's balance sheet
and one of the components of the accounting equation: Assets = Liabilities + Owner's Equity.
5.What is principles of accounting?: Principles of accounting can also refer to the basic or fundamental accounting
principles: cost principles, matching principles, full disclosure principles, materiality principles, going concern
principles, economic en- tity principles, and so on. In this context, principles of accounting refers to the broad underlying
concepts which guide accountants when preparing financial statements.
6.What is equity?: Equity can indicate an ownership interest in a business, such as stockholders' equity or owner's
equity.
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Business Peregrine Exam Questions with Correct Answers

1. What is a general ledger?: A general ledger account is an account or record used to sort, store and summarize a

company's transactions. asset accounts such as Cash, Accounts Receivable, Inventory, Investments, Land, and Equipment liability accounts including Notes Payable, Accounts Payable, Accrued Expenses Payable, and Customer Deposits stockholders' equity accounts such as Common Stock, Retained Earnings, Treasury Stock, and Accumulated Other Comprehensive Income

2. What is the difference between accounts payable and accounts receivable?-

: Accounts payable is a current liability account in which a company records the amounts it owes to suppliers or vendors for goods or services that it received on credit. Accounts receivable is a current asset account in which a company records the amounts it has a right to collect from customers who received goods or services on credit.

3. What is the cost of goods sold?: The cost of goods sold is the cost of the products that a retailer, distributor,

or manufacturer has sold.

4. What is owner's equity?: Owner's equity is one of the three main sections of a sole proprietorship's balance sheet

and one of the components of the accounting equation: Assets = Liabilities + Owner's Equity.

5. What is principles of accounting?: Principles of accounting can also refer to the basic or fundamental accounting

principles: cost principles, matching principles, full disclosure principles, materiality principles, going concern principles, economic en- tity principles, and so on. In this context, principles of accounting refers to the broad underlying concepts which guide accountants when preparing financial statements.

6. What is equity?: Equity can indicate an ownership interest in a business, such as stockholders' equity or owner's

equity.

Equity can mean an owner's interest in a personal asset. For example, the owner of a $200,000 house that has a mortgage loan of $75,000 is said to have $125,000 of equity in the house.

7. What is meant by reconciling an account?: Reconciling an account is likely to mean proving or documenting that

an account balance is correct.

8. What is included in cash and cash equivalents?: In accounting, a company's cash includes the following:

currency and coins checks received from customers but not yet deposited checking accounts petty cash Cash equivalents are short-term, highly liquid investments with a maturity date that was 3 months or less at the time of purchase. money market accounts U.S. Treasury Bills commercial paper

9. What is the difference between an implicit cost and an explicit cost?: An implicit cost is present but it is not

initially shown or reported as a separate cost. An explicit cost is a cost that is present and it is clearly shown or reported as a separate cost.

10. What is the difference between stocks and bonds?: Stocks, or shares of capital stock, represent an ownership

interest in a corporation. Every corporation has common stock. Bonds are a form of long-term debt in which the issuing corporation promises to pay the principal amount at a specified maturity date.

11. AN INCREASE TO WHICH OF THE FOLLOWING ACCOUNTS WILL IN- CREASE OWNERS'

EQUITY?: Client Fees

21. All of the following are considered extrinsic motivators in Herzberg's two-factor theory EXCEPT::

Work itself

22. Which of the following is NOT one of the process motivation theories?: -

Acquired needs theory

23. An individual who purchases a computer later decides to acquire a new motherboard. In terms of

computing GDP, this new motherboard would be a(n): Final good

24. The largest component of GDP is: consumption

25. In economics, firms are assumed to: Maximize profits

26. Holding everything else equal, total revenue increases: when either price or quantity increase

27. Government tactics that include removing incentives, demanding a higher share of profits and taxes, and

confiscating foreign assets are known as:: Ex- propriation

28. "People of the same trade seldom meet together, even for merriment and diversion, but their conversation

often ends in conspiracy against the public." This quote from Adam Smith is referring to which of the following business relationship terms:: Collusion

29. is a collection of facts organized so that they have additional value beyond the value of the facts

themselves.: Information

30. is the simulation of a real or imagined environment that can be experienced visually in three

dimensions.: Virtual reality

31. The Federal Highway Administration uses notice-and-comment rulemak- ing. This process begins with: the

publication of a notice of proposed rulemaking.

32. Kip opens an account at a Lotsa Goodies Store, and buys a digital music player and other items, but makes

no payments on the account. To collect the debt, Mako, the manager, contacts Kip's parents. This violates: No federal law

33. The process of setting major organization objectives and developing plans to achieve them is called:: Strategic

planning

34. One way human resource planning links to strategic planning is by provid- ing a set of inputs into the::

strategy formulation process

35. In the SERVQUAL instrument for measuring service quality, the concept of assurance is associated with:

The ability to convey trust and confidence

36. Which of the following is not one of W. Edwards Deming's 14 points?: The only performance standard is Zero

Defects

37. A leading force currently driving change at work is:: Global competition

38. A questioning, probing attitude is at the core of:: critical thinking

39. Which of the following IS NOT a purpose of a marketing plan?: It explains how marketing activities mesh

with other functional areas

40. In the context of marketing planning, why is it vital that the marketing plan be capable of selling itself to top

management?: Because top managers must decide whether the marketing plan is the best use for the organization's scarce resources

41. Sensitivity analysis considers: changes in the values of the payoffs.

42. A population characteristic, such as a population mean, is called: A para- meter

43. OPERATING STATEMENT IS ANOTHER NAME FOR WHICH OF THE FOL- LOWING?: Income

Statement

44. PURCHASES RETURNS AND ALLOWANCES AND PURCHASE DIS- COUNTS ARE CLASSIFIED AS

WHICH OF THE FOLLOWING ON THE INCOME STATEMENT?: CONTRA-COST ACCOUNTS

45. THE LAST STEP IN PREPARING A WORKSHEET IS WHICH OF THE FOL- LOWING?: TOTAL THE

INCOME STATEMENT AND BALANCE SHEET ITEMS TO COMPUTE NET INCOME (LOSS)

VARIOUS COUNTRIES.

51. Inflation: IS DEFINED AS A SUSTAINED INCREASE IN THE GENERAL LEV- EL OF PRICES FOR GOODS

AND SERVICES IN A COUNTY, AND IS MEASURED AS AN ANNUAL PERCENTAGE CHANGE. UNDER

CONDITIONS OF INFLATION, THE PRICES OF THINGS RISE OVER TIME.

52. Recession: IS A SIGNIFICANT DECLINE IN ECONOMIC ACTIVITY THAT GOES ON FOR MORE

THAN A FEW MONTHS. IT IS VISIBLE IN INDUSTRI- AL PRODUCTION, EMPLOYMENT, REAL INCOME

AND WHOLESALE-RETAIL TRADE.

53. International Trade: IS THE EXCHANGE OF CAPITAL, GOODS, AND SER- VICES ACROSS

INTERNATIONAL BORDERS OR TERRITORIES. IN MOST COUNTRIES, SUCH TRADE REPRESENTS A

SIGNIFICANT SHARE OF GROSS DOMESTIC PRODUCT (GDP).

54. MICROECONOMIC TRENDS: ARE PATTERNS OF MOVEMENTS OR CHANGES IN ECONOMIC

FACTORS SUCH AS CONSUMER, HOUSEHOLD, OR FIRMS' INCOME, SAVINGS, DEBT, AND

EXPENDITURE.

55. MICROECONOMIC ANALYSIS: ATTEMPTS TO EXPLAIN THE BEHAVIOR OF INDIVIDUALS AND

ORGANIZATIONS IN A GIVEN ECONOMY.

FUNCTIONS THROUGH MODELING AND BY EMPHASIZING INTERESTS.

56. Accounting Profit: IS THE MONETARY COSTS A FIRM PAYS OUT AND THE REVENUE A FIRM

RECEIVES.

TOTAL MONETARY - REVENUE TOTAL COSTS.

57. Economic Profit: IS THE MONETARY COSTS AND OPPORTUNITY COSTS A FIRM PAYS AND THE

REVENUE A FIRM RECEIVES.

TOTAL REVENUE-(EXPLICIT COSTS + IMPLICIT COSTS).

58. LAW OF SUPPLY: THAT THE QUANTITY OF A GOOD SUPPLIED (I.E., THE AMOUNT OWNERS OR

PRODUCERS OFFER FOR SALE) RISES AS THE MAR- KET PRICE RISES, AND FALLS AS THE PRICE

FALLS.

59. Law of Demand: SAYS THAT THE QUANTITY OF A GOOD DEMANDED FALLS AS THE PRICE

RISES, AND VICE VERSA.

60. Government tactics that include removing incentives: advance their own interests, those of the organization,

or those of some other group.

61. A suit for negligence must prove four elements: duty of care, breach of duty, proximate cause and:

Actual harm

62. Financial Regulation: is a form of regulation or supervision, which subjects financial institutions to certain

requirements, restrictions and guidelines, aiming to maintain the integrity of the financial system. This may be handled by either a government or non-government organization.

63. THE FTC'S BUREAU OF CONSUMER PROTECTION: STOPS UNFAIR, DE- CEPTIVE AND

FRAUDULENT BUSINESS PRACTICES BY COLLECTING COM- PLAINTS AND CONDUCTING

INVESTIGATIONS, SUING COMPANIES AND PEOPLE THAT BREAK THE LAW, DEVELOPING RULES TO

MAINTAIN A FAIR MARKETPLACE, AND EDUCATING CONSUMERS AND BUSINESSES ABOUT THEIR

RIGHTS AND RESPONSIBILITIES.

64. 6 BASIC RIGHTS OF CONSUMERS: right to safety, right to be informed, right to choose, right to be heard,

right to consumer education, right to courteous service

65. Corporate culture is shown: (1) the ways the organization conducts its busi- ness, treats its employees, customers,

and the wider community, (2) the extent to which freedom is allowed in decision making, developing new ideas, and personal expression, (3) how power and information flow through its hierarchy, and (4) how committed employees are towards collective objectives. It affects the organization's productivity and performance, and provides guidelines on customer care and ser- vice, product quality and safety, attendance and punctuality, and concern for the environment.

67. Individual and Group Dynamics: Interaction of complex intra- and inter-per- sonal forces operating in a group

which determine its character, development, and long-term survival. Field of study concerned with determination of laws underlying group behavior.

68. Population Sampling: is the process of taking a subset of subjects that is representative of the entire

population. The sample must have sufficient size to warrant statistical analysis.

69. TYPE I ERROR: IS THE REJECTION OF A TRUE NULL HYPOTHESIS (ALSO KNOWN AS A "FALSE

POSITIVE" FINDING)

70. TYPE II ERROR: IS FAILING TO REJECT A FALSE NULL HYPOTHESIS (ALSO KNOWN AS A

"FALSE NEGATIVE" FINDING)