Multiple Choice Answers

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Question 1
Allocating specific, limited resources to specific activities is called:
A. resource allocation.
B. resource leveling.
C. resource tracking.
D. expediting a project.

Question 2
The primary cause of concern in resource allocation is:
A. labor cost.
B. resource scarcity.
C. lack of solution methodologies.
D. parallel activities.

Question 3
A project that cannot go over budget is considered:
A. time constrained.
B. schedule constrained.
C. resource constrained.
D. performance constrained.

Question 4
The task duration with standard-practice resource usage is referred to as the:
A. expected task duration.
B. nominal task duration.
C. crash duration.
D. normal task duration.

Question 5
A task has a normal duration of 9 days and crash duration of 7 days. Its normal cost is $40 and its crash cost is $100. What is the crash cost per day?
A. $140
B. $70
C. $50
D. $30

Question 6
What is an expediting technique in which the design and planning phases of a project are not actually completed before the building phase is started?
A. resource loading
B. fast-tacking
C. crashing
D. critical path

Question 7
Resource __________ refers to the amounts of specific resources that are scheduled for use on specific activities or projects at specific times.
A. expediting
B. leveling
C. loading
D. allocation

Question 8
Which of the following priority rules makes resources available so that activities start on their LSTs whenever possible without increasing the project’s duration?
A. As soon as possible
B. As late as possible
C. Shortest task duration first
D. Minimum slack first

Question 9
Which of the following rules maximizes the number of tasks that can be completed by a system in a given period of time?
A. As soon as possible
B. As late as possible
C. Shortest task duration first
D. Minimum slack first

Question 10
Several projects can be linked together with:
A. virtual activities.
B. nominal activities.
C. pseudoactivities.
D. ER links.

Question 11
Which of the following is NOT commonly used to help select a priority rule?
A. Schedule slippage
B. Resource utilization
C. In-process inventory
D. Cost overruns

Question 12
Which of the following is a measure of the amount by which a project is delayed by application of a leveling rule?
A. Schedule inflation
B. Schedule progression
C. Schedule efficacy
D. Schedule slippage

Question 13
According to research, the best overall priority rule is:
A. as soon as possible.
B. as late as possible.
C. shortest task duration first.
D. minimum slack first.

Question 14
The practice of assigning project team members to multiple projects is called:
A. concurrent engineering.
B. parallel activities.
C. fast-tracking.
D. multitasking.

Question 15
The safety time added to chains other than the critical chain is called the:
A. feeding buffer.
B. project buffer.
C. path buffer.
D. critical buffer.

Question 16
In traditional Critical Path Method, a second estimate, referred to as the __________ duration, is made based on the resources required to expedite the task.
A. normal task
B. assumed
C. crash
D. approximated

Question 17
When task durations are estimated, an assumption is made that task resources are set at __________ levels.
A. standard
B. normal
C. manageable
D. low

Question 18
Used primarily in the construction industry, the term __________ refers to a technique in which the design and planning phases of a project are not actually completed before the building phase is started.
A. “fast-tracked”
B. “expediting”
C. “crash”
D. “resource loading”

Question 19
Goldratt’s Theory of Constraints focuses on:
A. uncertainty
B. constrained resources
C. tight project schedules
D. managing conflicting priorities

Question 20
With the __________ priority rule, tasks are supplied with resources in inverse order of their slacks. This rule usually minimizes the number of late activities.
A. most successors
B. most resources first
C. as late as possible
D. minimum slack first

Work Shown for All

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1 (future value) Albert Pujols hit 47 home runs in 2009. If his home -run output grew at a rate of 12 percent per year ,what would it have been over the following 5 years ?

2 (Present value) The state lottery’s million-dollar payout provides for $1 million to be paid over 19 years in 20 payments of $50000.The first $50000 payment is made immediately,and the 19 remaining $50000 payments occur at the end of each of the next 19 years .If 10 percent is the appropriate discount rate ,what is the present value of this stream of cash flows? If 20 percent is the appropriate discount rate ,what is the present value of the cash flows?

3 (Nonannual compounding using a calculator) Bowflex’s television ads say you can get a fitness machine that sells for $999 for $33 a month for 36 months. What rate of interest are you paying on this Bowflex loan ?

Answer of the below questions

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1. Suppose an investment offers to triple your money in 26 years. What annual rate of return are you being offered if interest is compounded monthly?
Note: Enter your rounded off to two decimal points. Do not enter % in the
box. For example, if your is 0.12345 then enter as 12.35 in the
box.

2 How many years will it take to double your money at 15% compounded semi-annually?
Enter your rounded off to TWO decimal points.

3 Your firm has the following balance sheet statement items: total current liabilities of $325,000; total assets of $3,655,000; fixed and other assets of $1,770,000; and long-term debt of $200,000. What is the amount of the firm’s net working capital?
1080000
1885000
1685000
1560000
325000

4 If you put $108 in a savings account at the beginning of each year for 19 years, how much money will be in the account at the end of the 19th year? Assume that the interest rate is 8.
Note: Enter your  rounded off to two decimal points. Do not enter $ or comma in the box. For example, if your is $12.345 then enter as 12.35 in the box.

5 If you receive $792 at the end of each year for the first three years and $8,382 at the end of each year for the next two years. What is the future value of this cash flow stream? Assume interest rate is 7%.
Note: Enter your rounded off to two decimal points. Do not enter $ or comma in the box. For example, if your  is $12.345 then enter as 12.35 in the box.

6 Consider a taxable bond with a yield of 10.6% and a tax-exempt municipal bond with a yield of 4.4%. At what tax rate would you be indifferent between the two bonds?
Note: Enter your rounded off to two decimal points. Do not enter % in the box. For example, if your is 0.12345 then enter as 12.35 in the box.

7 ABC Company offers a perpetuity which pays annual payments of $16,593. This contract sells for $221,788 today. What is the interest rate?
Note: Enter your rounded off to two decimal points. Do not enter % in the box. For example, if your is 0.12345 then enter as 12.35 in the box.

8 ABC is reviewing a project that will cost $1,494.The project will produce cash flows $429 at the end of each year for the first two years and $883 at the end of each year for the next two years. What is the profitability index? Assume interest rate is 7%.
Note: Enter your rounded off to two decimal points. For example, if your is 12.345 then enter as 12.35 in the box.

9 A firm has a return on equity of 21 percent, a net profit margin of 8.4 percent, and total equity of $675.1. What is the net income?
10 A project has the following cash flows. What is the internal rate of return?
Year 0 1 2 3
Cash flow -$121,000 68,150 $42,200 $39,100
0.1439
0.1347
0.1271
0.1385
0.1482

11 What is the effective rate of 24% compounded monthly?
Note: Enter your rounded off to two decimal points. Do not enter % in the box. For example, if your is 0.12345 then enter as 12.35 in the box.

12 ABC Company has a debt-equity ratio of 0.69. What is the debt ratio?
Note: Enter your rounded off to two decimal points. Do not enter % in the box. For example, if your is 0.12345 then enter as 12.35 in the box.

13 In its most recent financial statements, ABC reported $68,853 of net income and $592,366 of retained earnings. The previous retained earnings were $679,945. How much in dividends was paid to shareholders during the year?
Note: Enter your rounded off to two decimal points. Do not enter $ or comma in the box. For example, if your is $12.345 then enter as 12.35 in the box.

14 You’ve decided to pursue higher education and enroll in a MS in Finance program. If you borrowed $150,000 at a fixed interest rate of 7.5% and can only make payments of $25,000 per year to pay off the loan, at the end of this and each additional year. How many years will it take before you can once again live debt-free?
Enter your in the box rounded off to TWO decimal points.

Johnson

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Johnson Company provided the following financial information for its installment-sales for the current year:
Financial Data:
Installment Sales for the Current Year $800,000
Cost of Goods Sold on Installment Basis $600,000
Payments by Customers $320,000
Repossessed Merchandise – Unpaid Balances $52,000
Repossessed Merchandise – Estimated Value $26,800

Required:
A) Prepare Journal Entries for the end of the year based on the information above.
B) Prepare the Entry to record Gross Profit realized in the current year.