is the logical integration of techniques to gather and use data for planning and control decisions and to evaluate performance. A) An internal control system B) A quality control system C) A financial reporting system D) A management control system Answer 2. Which of the following statements is FALSE? A) Discounted cash flow models focus on future cash inflows and outflows B) Discounted cash flow models consider the time value of money. C) Discounted cash flow models focus on net income. D) Discounted cash flow models compare cash outflows today to the present value of future cash flows. Answer: 3. In a job-order system, which of the following statements is TRUE? A) The Work-in-Process Inventory account is increased by the actual factory overhead costs incurred for a job. B) The Work-in-Process Inventory account is increased by the applied factory overhead costs for a job. C) The Work-In-Process Inventory account is decreased by the budgeted amount of factory overhead costs for a job. D) The Work-In-Process Inventory account is increased by the budgeted amount of factory overhead costs for a job. Answer: 4. Decentralization may increase a firm's costs because A) lower level managers duplicate services that may be less expensive if centralized B) information costs rise as top management needs additional reports to learn about decentralized units C) lower level managers may make decisions that are not in the best interests of the firm as a whole D) all of the above Answer: 5. Convertible bonds allow a bondholder to exchange A) unsecured bonds for secured bonds B) unsubordinated bonds for subordinated bonds C) common stock for bonds D) bonds for mortgage bonds Answer 6. A budget prepared for different levels of activity is called a A) rolling budget B) operating budget C) flexible budget D) static budget