Which Ratio
Net income/sales
What is profit margin
A method of assigning overhead costs to a product using a single overhead rate is
What is the plantwide overhead rate method
The price used to record transfers of goods across divisions of the same company
What is transfer price
A department that incurs costs without generating revenues
What is a cost center
The comparison of a company's financial performance across time is know as
What is horizontal or trend analysis
Sales/Average Total Assets
What is total asset turnover
A method of assigning overhead costs to a product using multiple rates figured by the activities used in production
What is activity-based costing
An accounting system that is set up to control costs and evaluate managers' performance by assigning costs to the managers responsible for controlling them is called a
What is a responsibility accounting system
A department that generates revenues and costs
What is a profit center
The ability to generate future revenues and meet long-term obligations is referred to as
What is solvency
Current assets/current liabilities
What is current ratio
The balance in the Work in Process Inventory at any point in time is equal to
What is the sum of the costs of all jobs started but not yet completed
The ability to meet short-term obligations and to efficiently generate revenues is called
What is liquidity
A department that generates revenues and costs, and the manager is responsible for major investing decisions
What is an investment center
The base amount used when performing vertical analysis on a balance sheet
What is total assets
Market price per share/earnings per share
What is price-earnings ratio (PE ratio)
The overhead cost applied to a job during a period is recorded with a debit to this account
What is Work-in-Process Inventory
The measurement of key relations among financial statement items is known as
What is ratio analysis
Methods used to evaluate investment centers
What are return on investment and residual income
The base amount used when performing vertical analysis on an income statement
What is sales revenue
Cash+short term investments+accounts receivables/Current liabilities
What is acid-test ratio or quick ratio
The four sections of a balanced scorecard
What are customer, financial, internal processes, and learning/development
The three major cost components of manufacturing a product
What are direct materials, direct labor, and overhead
Return on investment can be calculated by taking two ratios times each other. Those two ratios are
What are profit margin and asset turnover
The ability to provide financial rewards sufficient to attract and retain financing is called
What is profitability