Exam 15: Budgeting and Controlling Operations and Taxes

The _____ is the ratio of current assets, less inventory, to current liability.

Return on equity is the ratio of net profit to owners' equity.

The capital budget is the most basic plan to consider and must be prepared before all other budgets.

Indirect taxes must either be added to the price of the firm's product or shifted backward to the persons who produced the product because they are part of the cost of doing business.

The _____ is a tax on the consumption or storage of goods within a taxing jurisdiction.

Uncollectable accounts receivable can be written off by small businesses to decrease business income tax liability.

Which of the following is a method of computing inventory that small firms tend to use to save taxes when prices rise?

Discuss how taxes affect small businesses.

Describe the process of preparing an operating budget.

Poor performance in a team can be effectively checked by increasing the number of employees.

What is the function of cash flow budget?

Extending credit decreases the potential for sales.

Excise tax refers to the tax levied on an individual's income.

_____ refer to the acceptable levels to which employee achievement should conform.

Performance standards tell employees in advance what level of performance is expected of them.

The _____ shows how easily a company can pay its short-term obligations.

In _____ auditing, an outside certified public accountant (CPA) verifies the records and financial statements of a company-usually once a year.

A company should be audited annually to ensure continued proper financial reporting.

A budget is a summary statement of a firm's current liabilities.

Which of the following helps increase the assets or decrease the liabilities of a company?