Business Acumen Practice Test

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Business Acumen

• LACOSTE STYLE AND PLAY uses the latest technology to reduce lead time & manage waste; it secured ISO certification.
• Technological development is the support activity in the value chain being described.
• Threat of competition IS part of the Porter's Five (5) Forces Model
• Discussions occurs last in the data life cycle
• Statement that is true relating to data analytics: A time series plot is a graphical presentation of the relationship between time and the time series variable, a horizontal pattern exists when the data fluctuate randomly around a constant mean over time
• ENRIQUEZ CO. performed an overhaul of operations in the production department, leading to the retooling of Standard Operating Procedures (SOP)., implements a Radical Improvement Strategy.
• A company must have a vision to derive business strategies, but missions are not essential in place for strategy implementation - FALSE
• A combination of a comprehensive strategy mechanism coupled with effective resource allocation guarantees success in the business industry - FALSE
• When PUREGOLD CO. resells goods from manufacturers at a low-cost, disregarding market sector brackets therefore the application of Cost Leadership strategy is TRUE
• WALMART INC. replenishes inventory daily for perishable goods in an effective application of Lean Management Strategy -FALSE
• MCDONALDS COMPANY released “Flavors of Japan" viand on its menu, thus, implementing Kaizen approach - FALSE
• JOLLIBEE FOODS CORPORATION's crew staff circulates across the branch, asking for comments from diners as to the palatability of food. This is an application of a primary activity of the value chain - FALSE
• MOIRA INDUSTRIES purchased SAP S4 HANA software to serve as its accounting system, describing Reporting Software.
• STATESIDE INC. plans an internal audit engagement using Gantt Chart
• Business Intelligence (BI) collects and analyzing internal data and external data to provide new insights that were not apparent before - TRUE
• Online analytical processing (OLAP) tools allow users to analyze datasets from a wide variety of angles based on different business perspectives - TRUE
• The presence of hierarchy in an organization creates various levels of authority arranged in the order of delegated powers in the organization - TRUE
• The presence of hierarchy in an organization creates various levels of authority arranged in the order of delegated powers in the organization - FALSE
• Materials are processed directly to finished products on time and are shelved as inventory is a characteristic of a Traditional Inventory System
• The “Toyota Way” or “Toyota Production Systems” is an example of an application of Kaizen strategy
• Inspection is considered as “non-value adding"
• Cost Leadership was the strategy implemented by retailers.
• CORNERSTONE ENTERTAINMENT decided to pursue this tactic to elevate concert experience for the first time.
• Head + heart change management principle was implemented by CORNERSTONE

Financial Accounting and Reporting

• An unadjusted trial balance provides information when making adjusting entries
• A chart of accounts is a list of all account titles in the general ledger
• Temporary accounts are known as Nominal accounts
• Timeliness when entity has started placing its quarterly financial statements on its website
• Adjusting entries are recorded first in the accounting process
• Prepare reversing entries is last done in the accounting process
• The dual effect of each transaction is recorded with a debit and a credit within the double entry accounting system
• Prepayments under the Expense Method is reversible
• KAAYO COMPANY cannot close the "Repairs and Maintenance Expense" balance at year-end. - FALSE
• KAAYO COMPANY should accrue "Repairs and Maintenance Expense" in the amount of P10,000 for July 2025 - FALSE
• Government-mandated benefits is NOT a classification of employee benefits according to IAS.
• If ISIDRO leased a machine and is not certain to exercise this privilege, this is a Finance Lease
• RIVERBANK issued bonds at a face value of P10,000,000 therefore, RIVERBANK bonds were issued as debentures - FALSE
• RIVERBANK bonds were issued at a premium - TRUE
• At the end of the bond term, the carrying value of the bond is at P10,000,000 - FALSE
• The Interest Expense for 2025 amounts to P432,000 - FALSE
• If an entity Expenses are classified as a research cost.
• Development costs are capitalized as Intangible Assets
• Which of the following is true about sustainability reporting; Sustainability reporting plays a role in accountability relationships as it is a means by which organizations communicate with a range of stakeholders and such information in the report should be relevant to the stakeholders as well.
• Materiality is best described as Subjective

Management Services

• Horizontal analysis Financial statement data is evaluated over a period of time.
• Vertical analysis is known as common size analysis.
• Horizontal analysis is tool
• The base for cost of goods sold is net sales.
• Current assets of KZ Company are $150,000, the current liabilities are $120,000, therefore the current ratio is 1.25: 1
• The current ratio may also be referred to as working capital ratio.
• Cloth used in the manufacture of jeans is a Direct Cost
• All statements are incorrect relating to Cost Estimation and Cost Behavior
• All statements are incorrect relating to the arguments given involving plant manager, cost accountant and palleting overhead variance for the month.
• Statements 1, 2 and 4 are incorrect relating to the preparation of Statement of Cost of Goods Manufactured and Sold
• Direct labor cost is used in a Job Order Costing system
• Statements 1 and 2 are incorrect relating to the preparation of Cost Behavior
• Camera lens in a smartphone is considered as a product cost
• $8 is the fixed costs per unit when 12,500 units are produced
• $22,000 is the manufacturing overhead

Operations Auditing

• Incompatible duties is likely would not be considered an inherent limitation of the potential effectiveness of an entity's internal control
• Cash disbursements would select items for testing from the file of all.
• Shipments to customers are properly invoiced evidence provides invoice that.
• A bank lockbox system would reduce the risk of diversion of customer receipts.
• Dates, checks are deposited per bank statements that match the dates remittance credits
• Daily sales summaries are compared to daily postings to the accounts receivable ledger would assure that all billed sales are correctly posted to the accounts receivable ledger
• Write-offs of uncollectible accounts should be approved in the Treasurer with the department
• The receivable bookkeeper should update the listings in the receivable record
• Each voucher is stamped "paid" by the check signer ensures each voucher is submitted and paid only once
• Receiving department strengths when the quantity of merchandise ordered is omitted
• Defective returns are presented to receiving clerk
• Financial audits deal with the information on the financial statements
• Authorizing payroll rate changes for all employees is responsible for assessing control risk at a high-level
• Deposited in a special bank account to minimize the opportunities for unclaimed cash payroll
• Custody over securities is NOT a control
• Personnel approves changes in pay rates and deductions from employee salaries
• Employees bank hours for which they are paid the data is audited
• Each employee should be asked to sign a receipt for internal control payroll
• Cashier material fraud is most difficult to detect
• Controller controls assist with completeness
• There are no significant deficiencies in the design or operation of internal control representation should not be included in an internal control report
• Compensating controls limit the severity of a material weakness objectivity assessing
• Determine the organizational level to which the internal auditors report
• Prenumbered purchase order forms is the least persuasive audit
• Cash balances were overstated is detected when tracing bank transfers
• Sales returns is recorded when recording test during physical inventory
• Voucher register and sales returns journal report entries.
• Purchase returns and allowances account evidence is related to the recorded retirement.
• Compare interest expense with the bond payable amount for reasonableness within Bonds payable

Information Systems and Control

• collection of data items is called a Database
• Joining allows auditors a database
• Lenovo Laptop not a smart device.
• Internal Audit monitoring over security
• Senior Management has primary responsibility of data
• Cryptographic devices are used to reduce security exposure
• Processing groups of transactions recorded on a delayed basis
• Online, real-time systems records are updated immediately, data is assembled and updated.
• Timeliness of data advantage of batch processing.
• Data availability is relevant to online systems.
• Validity check for customer input number
• Malware is broad term for worms
• Can travel independently through computer systems is a worm
• Remember is a strategy
• A biometric access system is not a physical security control
• A Proxy server's purpose is to process and filter requests

91. This type of software pretends to offer useful or desirable features but actually contains damaging code? a. Trojan horse. b. Virus. c. Worm. d. Spyware.
92. Which system conversion method has the least risk? a. Phased or modular conversion. b. Parallel conversion. c. Plunge or direct conversion. d. Pilot conversion.
93. Minimizing the likelihood of unauthorized editing of software can best be accomplished:: a. Database access reviews. b. Compliance reviews. c. Good change-control procedures. d. Effective network security software.
94. If a database has integrity this pertains to a. Software was implemented after extensive acceptance testing. b. Database has only consistent data. c. Database is secure from accidental entry. d. Database and the system have been reviewed by an external auditor.
95. This operating procedure increase the company's risk of viruses? a. Encrypting data files. b. Conducting frequent backup of files. c. Downloading public-domain software from websites. d. Installing original copies of purchased software.
96. Public Key Encryption is the same as Symmetric Encryption. a. True

Practice questions for business acumen, covering topics like value chain analysis, Porter's Five Forces, data analytics, and improvement strategies. Includes examples from industries such as LACOSTE. Focus on key business concepts and practices.