# Shared Flashcard Set

## Details

Anderson FINAL exam
this is for SDSU Dr. Andersons acctg202 final exam/exam 6
28
Accounting
05/08/2011

Term
 what does IRR stand for
Definition
 Internal Rate or Return
Term
 What is another name for Internal Rate of Return?
Definition
 IRR
Term
 What is the formula for IRR?
Definition
 Today's Cost/ Yearly Expense
Term
 What does NPV stand for?
Definition
 Net Present value
Term
 What does a positive NPV signify?
Definition
 The fact that the deal is a money maker
Term
 What does a negative NPV signify?
Definition
 That the deal is a money looser
Term
 What can be learned if the IRR is less than the Cost of Capital?
Definition
 That the deal is a money looser
Term
 What is the formula for NPV?
Definition
 (PV of future money)-(Today's Cost)
Term
 T/F-The IRR is given as a percentage?
Definition
 True
Term
 What is the formula to find BookValue?
Definition
 BBookvalue=originalcost-all depreciation
Term
 what is the Net Cash Flow formula?
Definition
 (sell price-Book Value)= Gain/loss*Tax%
Term
 Which is easier to calculate? NPV or IRR?
Definition
 NPV beause it will always give a definitive number
Term
 What is an additional benefit of NPV?
Definition
 It is easier to adjust for risk
Term
 The higher the risk...the higher the ...??
Definition
 Hurdle Rate
Term
 The hurdle rate that is used in a net-present value analysis is the same as the firm's:1) Discount Rate2) IRR3) Minimum desired rate of return4) objective rate of return5) discount rate and minimum desired rate of return
Definition
 5) discount rate and minimum desired rate of return
Term
 The net present value of a project is \$13,458 at a cost of capital of 23%. The Internal Rate of Return would then be:1) 12%2) Greater than 12%3) Less than 12%4) Cannot be determined
Definition
 2) Greater than 12%
Term
 what is the formula for markup %?
Definition
 ((profit+Other costs)/Cost base)*100=markup %
Term
 what is the formula for total charge labor rate?
Definition
 hourly labor rate+(total OH/Total labor hours)+Profit per hour=
Term
 What is competitive bidding?
Definition
 Where two or more companies submit bids
Term
 computer integrated manufacturing
Definition
 A computer design and costing
Term
 cost plus pricing
Definition
 a pricing approach in which the price is equal to cost plus a markup
Term
 penetration pricing
Definition
 setting a low initial price for a new product in order to penetrate the market deeply and gain a large and broad market share
Term
 perfect competition
Definition
 a market in which the price does not depend on the quality sold by any one producer
Term
 predatory pricing
Definition
 An illegal practice in which the price of a product is temporarily to broaden demand. Then the product's supply is restricted and the price is raised
Term
 price discrimination
Definition
 the illegal practice of quoting different prices for the same product or service to different buyers, when the price differences are no justified by cost differences
Term
 Price takers
Definition
 Firms whose products or service are determined totally by the market. The price you can charge is fixed by the market; especially for commodities (oil, milk, etc.)
Term
 Which of the following terms describes a pricing strategy in which a new product's initial pricing is set relatively low in order to gain a large market share?1) Penetration pricing2) Price Skimming3) Customer Pricing4) Designed Pricing5) Market-Share Pricing
Definition
 1) Penetration Pricing
Term
 what costs are used in the Variable Method?
Definition
 Direct Materials, Direct Labor, Variable OH
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