Online Flashcards for OB Exam

Written Jay Ho:

So I’ve put together 5 sets of flashcards for the Organization Behavior exam tomorrow. I think the exam will be applications of the concepts that we learn in class and some in the textbook. In order to know to how apply these concepts, you need to know what they mean. I’ve provided the links to all 5 sets! Chapters 1,2,3,4 and 8.

Chapter 1

Chapter 2

Chapter 3

Chapter 4

Chapter 8


Math Practice Final and Answer Key


Final Exam formulae

Final-practice test

Review for the Final Exam

 Exam Review Questions: Pages 7-21 to 7-32: #1 – 54

 Information about the Test
• 18 multiple choice questions on Chapters 1-6: 36%
• 4 long questions on Chapters 5-6: 64%
(one question on mortgages, one on annuities and two questions from Chapter 6)

 Formulas and Calculator Instructions Provided
• N = L (1 – d1) (1 – d2) (1 – d3)…
• S = C + M
• b = Slope = y = a + bx
• R = Px C = F + Vx Profit = R – C CM = P – V
• I = Prt

 To switch to payments at the beginning of the interval:
• Press 2ND BGN (above the PMT key). The display should show END.
• Press 2ND SET (above the ENTER key). The display should show BGN.
• Press CE/C (bottom left corner) or 2ND QUIT (top left corner)

 To go back to payments at the END of the interval:
• Press 2ND BGN (above the PMT key) The display should show BGN.
• Press 2ND SET (above the ENTER key). The display should show END.
• Press CE/C (bottom left corner) or 2ND QUIT (top left corner)

Practice Final Exam (2 hours)
1. You bought a government of Canada Treasury Bill for $960. You redeemed that for $1000 when it matured 181 days later. What simple rate of interest did you earn?
(a) 4.00%
(b) 4.17%
(c) 8.07%
(d) 8.40%
(e) None of the Above

2. A debt of $300 was due 3 months ago. Another debt of $300 is due 3 months from today. If both debts are paid today, what is the size of this payment, if simple interest rate is 8%? Use today as focal date.
(a) $600.00
(b) $600.12
(c) $612.00
(d) $588.46
(e) None of the Above

3. You are thinking about purchasing some preferred shares in Value Vacations Inc. The shares pay a semi-annual dividend of $1.15 per share and the next dividend is due in six months. What would you be willing to pay per share today if you want to earn at least 8.16% EFFECTIVE on your investment?
(a) $29.90
(b) $28.19
(c) $14.09
(d) $28.75
(e) $15.24

4. Ten years ago, you bought $1,000 worth of Canada Savings Bond that paid 5% for the first 5 years, and 6% for the next 5 years. All rates are compounded semi-annually. What is the maturity value of this bond today?
(a) $1,638.62
(b) $1,806.11
(c) $1,720.33
(d) $2,624.00
(e) None of the Above

5. A rich relative has specified that you will receive $10,000 on your 21st birthday. You are now exactly 18½ years old, and in need of money to pay your tuition. How much can you borrow from the bank if money is worth 8% compounded quarterly?
(a) $8,203.48
(b) $8,619.83
(c) $7,686.09
(d) $8,208.79
(e) None of the Above

6. Deposits of $100 made at the end of every month for 30 months accumulate to $3,478.50. What EFFECTIVE rate of interest are these deposits earning?
(a) 1%
(b) 12%
(c) 15.95%
(d) 12.68%
(e) None of the Above

7. You wish to celebrate graduation from BCIT in Hawaii 18 months from now. Starting today, you set aside $100 every month in an account that pays 8% compounded monthly. How much interest will you earn in these 18 months?
(a) $105.72
(b) $118.42
(c) $109.11
(d) $97.83
(e) None of the Above

8. A stereo system can be purchased by making a down payment of $130, followed by monthly payments of $85 at the end of every month for 15 months. If the interest rate is 7% compounded monthly, what is the selling price of this stereo system?
(a) $1,217.42
(b) $1,328.40
(c) $1,347.42
(d) $1,458.40
(e) None of the Above

9. Royal Canine Pet Foods sells its gourmet pet food to retailers at trade discounts of 15% and 10%. A competitor sells its pet food at the same list prices but with trade discounts of 20% and 10%. Royal Canine wants to match the competitor’s prices by offering a third trade discount. What third discount rate should Royal Canine offer to meet their objective?
(a) 5.0%
(b) 94.1%
(c) 4.5%
(d) 36.6%
(e) 5.9%

10. A retailer purchased Cougar Woods golf shoes for $150. The regular selling price of the golf shoes includes a MARGIN of 40%. During a sale the shoes were marked down by 30%. What was the sale price of a pair of Cougar Woods shoes?
(a) $175.00
(b) $262.50
(c) $75.00
(d) $165.00
(e) $147.00

11. A leather jacket that sells for $400 carries a MARKUP of 30%. How much did this jacket cost the retailer?
(a) $280.00
(b) $120.00
(c) $520.00
(d) $571.43
(e) $307.69

12. You receive an invoice from your supplier for 12 colour laser printers for $1,600 each. Payment terms are 2/10, n/30. Nine days after the invoice date you pay $10,000. If the supplier allows discounts for partial payments, how much is still owing after this payment?
(a) $9,200.00
(b) $9,400.00
(c) $8,816.00
(d) $9,000.00
(e) $8,995.92

13. Berring Brothers Brewery makes a pale ale beer. Their fixed costs are $150,000 per month and the beer costs $4.00 per case to make. Their monthly production capacity is 16,000 cases of beer. At capacity, what price should they charge for a case of beer for so they can make a profit of $50,000 per month?
(a) $8.50
(b) $12.50
(c) $13.38
(d) $16.50
(e) None of the Above

Use the following information to answer questions 14 and 15 below:
A manufacturer of lithium batteries for laptop computers has fixed costs of $12,000 per month and variable costs of $50 per battery. Each battery sells for $80.

14. What is the breakeven point in sales dollars?
(a) $400
(b) $32,000
(c) $73,846
(d) $19,200
(e) $20,000

15. If the manufacturer incurs a LOSS of $3,000 for the month how many batteries did they sell that month?
(a) 400
(b) 500
(c) 69.23
(d) 115.38
(e) 300

16. You have just arrived at JFK Airport in New York on your return trip from London, England. You have 800 British Pounds. How much US currency can you purchase with your 800 British Pounds? Use the following exchange rates:
• $1.00 CDN = $.767 US 1 British Pound = $2.10 CDN
(a) $1,288.56
(b) $2,190.35
(c) $292.19
(d) $496.68
(e) none of the above

Use the following information to answer questions 17 and 18:
Discount Truck Rental rents 5-ton moving vans for a fixed charge per day plus an additional charge per kilometre driven. Discount Truck charges you $205 to travel 100 kilometres and $165 to travel 50 kilometres. There is a linear relationship between cost and distance.
17. Calculate the cost per kilometre driven.
(a) $1.25
(b) $2.05
(c) $.80
(d) $3.30
(e) $2.47
18. Calculate the fixed charge per day.
(a) $40.00
(b) $125.00
(c) $156.25
(d) $82.00
(e) $64.00

19. Chris intends to start saving for his retirement by making equal monthly deposits into a savings account starting today. He will continue making deposits for 25 years so that he will have enough money to live on when he retires. Two months after his last deposit, he intends to withdraw $900 per month for his living expenses for a period of 10 years. The invested funds earn 6% compounded annually (effective) for the 35-year period.
(a) Draw a detailed well-labelled time diagram.
(b) Find the size of the monthly deposits.
(c) How much does Chris earn in interest over the 35-year period?

20. Five years ago the Stewarts purchased a $495,000 home on the North Shore. They made a down payment of $125,000 and mortgaged the balance with a credit union. The interest rate was 6.5% compounded semi-annually, for a five-year term, amortized over 25 years.
(a) Calculate the size of the monthly payment required. The credit union rounds the payment up to the next dollar.
(b) How much interest did the Stewarts pay in the third year of the mortgage?
(c) The Stewarts, after having made 5 years of payments, made a lump-sum payment to reduce the outstanding balance to $310,000. What was the lump-sum payment?

(d) After making their lump sum payment, the Stewarts renew their mortgage with the $310,000 balance, for a further 5-year term at the same interest rate (6.5% compounded semi-annually), over a reduced amortization period of 15 years. Calculate the new monthly payment. Round the payment up to the next dollar.
(e) Assuming the interest rate remains the same over the remaining 15 years, calculate the size of the final payment.

21. You are considering a new business venture operating a transportation business in the communities around Barclay Sound. You have an option to purchase an old boat and will use it to make deliveries to properties which are water accessible only.
The boat will cost $90,000 and require $10,000 in repairs immediately. You estimate your annual expenses to be $15,000. You expect revenues of $25,000 in the first year, $35,000 in the second year, $50,000 in the third year and $60,000 in the fourth year. At the end of the fourth year you expect to sell your business for $70,000.
Assume all revenues are at the end of the year and all expenses at the beginning of the year.
(a) Draw the cash-flow diagram
(b) You are worried about the potential for rising interest rates. What is the highest rate you would be willing to pay to finance this project?
(c) Calculate the NPV using a MARR of 10%. Explain whether you should accept this project.
(d) The Alberni Regional District is considering charging a fee for using Government Docks in the region. The fee will be payable every year at the beginning of the year. What it the maximum amount they could charge per year and still keep this an acceptable project using a MARR of 10%?

22. You have decided to start a salmon guiding business in Bamfield and need to purchase a trolling motor for your boat. You have narrowed your choices to two models, the Ewenrude and the Johnstone. Summary data from the models is provided below:
Ewenrude Johnstone
Expected life 8 years 5 years
Maintenance costs $100/year $250/year
Fuel costs $250/year $400/year
Salvage Value $1,000 $1,000
Purchase Price $4,500 $2,800
Assume expenses occur at the beginning of the year and inflows at the end of the year. Your MARR is 12%.
(a) Draw the cash-flow diagrams. (b) Calculate the NPV for each engine.
(c) Calculate the Equivalent Uniform Annual Cost (EUAC) for each engine – which one should you select if cost is your basis for making a decision?
(d) The salesperson for the model you did not choose has told you he thinks the estimated salvage value is too low. What salvage value would make the two models equal in terms of annual cost?

Answers to the Practice Final Exam
1. d 2. b 3. d 4. c 5. a 6. d 7. b 8. c 9. e 10. a 11. e 12. e 13. d
14. b 15. e 16. a 17. c 18. b
19. (a)

(b) $120.15 (c) $71,955
20. (a) $2,479 (b) $22,704.77 (c) $24,639.59 (d) $2,686 (e) $2,609.29

21. (a)

(b) 16.81%
(c) NPV = $25,707.60 Since the NPV is positive, this project is earning more than 10% and therefore, you should accept it.
(d) $7,372.73 (or $7,372.72)
22. (a) Ewenrude:


(b) Ewenrude NPV = $6,043.43 Johnstone NPV = $4,856.85
(c) Ewenrude EUAC = $1,216.56 Johnstone EUAC = $1,347.34
You should select the Ewenrude.
(d) $1,830.83

Online Database for Marketing Multiple Choice Questions


Chapter 2

Of the five steps to the strategic marketing planning process, which step usually comes after implementing marketing mix and allocating resources?
A) evaluate performance.
B) define the business mission.
C) situation analysis.
D) identifying and evaluating opportunities.
E) none of the above, after implementing the marketing mix and allocating resources, the marketer is finished.

Vince works as a waiter at many business functions. GRIPO insurance company has just had their annual meeting and left behind copies of their marketing plan. Vince opens a copy of the plan. Which of the following would Vince NOT expect to find in GRIPO’s marketing plan?
A) a situation analysis.
B) company description
C) segmentation and target market analysis
D) marketing objectives.
E) CVs of sales representatives.

When conducting a SWOT analysis, a company will assess all of the following EXCEPT:
A) Strengths
B) threats
C) weaknesses
D) opportunities
E) strategies

Which of the following is likely to be source of a sustainable competitive advantage?
A) supply chain efficiency.
B) brand name.
C) customer satisfaction.
D) patented technology.
E) all of the above.

When identifying and evaluating opportunities, STP refers to:
A) stratifying, taking, professing.
B) strategic, target, preferences.
C) segmentation, targeting, and positioning.
D) seasonal, temporary, permanent.
E) sustainable, temporary, positions.

After identifying various market segments that his company could pursue, Lionel evaluated each segment’s attractiveness based on income, size, and accessibility. Lionel was involved in:
A) target marketing.
B) situation analysis.
C) diversification.
D) operational excellence calculations.
E) market penetration estimation.

Positioning involves the process of defining the marketing mix variables so that target customers have a _________________ of what a product does or represents in comparison with competing products.
A) cost-based accounting
B) vague idea
C) sustainable vision
D) clear, distinctive understanding
E) positive, forward-thinking estimate

The pricing strategy that involves first determining the perceived value of the product from the customer’s point of view and then pricing accordingly is well known as:
A) cost-based pricing
B) value-based pricing
C) competitor-based pricing
D) consumer-based pricing
E) breakeven pricing

On a BCG growth-share matrix, the horizontal axis represents ——————- and the vertical axis represents —————– .
A) market share and market growth rate
B) market growth rate and market share
C) relative market share and market growth rate
D) market growth rate and relative market share
E) Profit and sales

Which of the following is NOT one of the four major growth strategies marketers typically pursue?
A) market penetration
B) market development
C) customer detention
D) diversification
E) product development

The growth strategy that employs the existing marketing mix and focuses the firm’s efforts on existing customers is called:
A) diversification
B) market penetration
C) market reinforcement
D) market development
E) product development

The growth strategy whereby a firm introduces a new product to a new market segment is known as:
A) Diversification
B) Market penetration
C) Market reinforcement
D) Market development
E) Product development

Almost every enthusiastic salesperson thinks his or her firm provides better service than their competitors. If this is accurate, and customers recognize it, the salesperson creates and delivers value through:
A) customer excellence
B) operational excellence.
C) product excellence.
D) promotional excellence.
E) global excellence.

Firms achieve operational excellence through:
A) customer loyalty.
B) strategic acceptance by marketing intermediaries.
C) relative market share growth.
D) value-based penetration.
E) efficient procedures and excellent supply chain management.

In the SWOT analysis for Disney, the following is NOT an opportunity
A) Well-known brand
B) Expand into international markets
C) Expand existing business in Canada
D) Expand cruise line business
E) Build new attractions for theme parks

Chapter 4

By paying close attention to _________________ and continuously monitoring the environment in which it operates, marketers can identify potential opportunities.
  A) cognitive dissonance
  B) customer needs
  C) just-in-time marketing promotions
  D) regional psychographic groups
  E) all of the above.
A firm’s macroenvironment includes _____________ factors.
  A) political/legal
  B) cultural
  C) demographic
  D) economic
  E) all of the above
The _____________ is the center of all marketing efforts.
  A) profit
  B) consumer
  C) mission
  D) scenario plan
  E) foreign fluctuations
Which of the following pricing practices is covered in the Competition Act?
  A) price fixing
  B) bid rigging
  C) resale price maintenance
  D) predatory pricing
  E) all of the above
When evaluating their competition, marketers need to assess competitors’ strengths, weaknesses and:
  A) visions.
  B) intelligence.
  C) likely reaction to marketer’s activities.
  D) philosophy.
  E) none of the above.
Firms use competitive intelligence to collect and synthesize information about their position with respect to:
  A) recent demographic data.
  B) their rivals.
  C) regional regression urbanization strategies.
  D) macroeconomic variable analysis.
  E) intuitive diagnostics.
Which of the following promotion practices is covered in the Competition Act
  A) comparative advertising
  B) cooperative advertising
  C) bait-and-switch
  D) consumer discounts
  E) coupons
Marketers have learned that ________________ influences where, when, how, and what consumers buy.
  A) mission statements
  B) JIT systems
  C) scenario planning
  D) competitive intelligence
  E) culture
Typical _____________ data include race, gender, income, and marital status.
  A) behavioural
  B) macromarketing
  C) inflationary situation
  D) regional social
  E) demographic
Compared to other groups, _______________ are more likely to complain, to need special attention, and to take time browsing before making a purchase decision.
  A) Tweens
  B) Baby Boomers
  C) Generation Xers
  D) Generation Yers
  E) Seniors
Jeanette just joined an after-work aerobics class. She also recently had cosmetic surgery and spent a week at rejuvenation spa in Costa Rica. Jeanette is most probably a member of the _________________ generational cohort.
  A) Senior
  B) Baby Boomer
  C) Generation X
  D) Generation Y
  E) Tween
Marketers to upper-income groups attempt to create value by offering:
  A) value-based pricing
  B) discounts
  C) no-frills products
  D) convenience
  E) one-of-a-kind products and exclusive services.
By offering environmentally responsible products, _______________ add value that other products do not have.
  A) macromarketers
  B) competitive intelligence marketers
  C) JIT marketers
  D) scenario planners
  E) green marketers
In __________________ marketers develop possible conclusions based on the plausible alternative courses of action the firm might pursue.
  A) competitive intelligence
  B) green marketing
  C) scenario planning
  D) JIT systems
  E) SWOT analysis

Chapter 5

Market research includes:
A) collecting data.
B) analyzing data.
C) recording data.
D) interpreting data.
E) all of the above.

A marketing information system (MkIS) is a set of procedures and methods applied to__________________________ to be used in marketing decisions.
A) VALS2 results
B) syndicated, unstructured survey systems
C) wholesaling warehouse system logistics
D) the regular, planned collection, analysis, and presentation of information
E) primary data mining

Related to market research efforts, consumers are more anxious than ever about:
A) secondary data retrieval systems.
B) exploitation of resources by unscrupulous global marketers.
C) the use of data mining by dating services.
D) the unstructured nature of market research.
E) preserving their fundamental right to privacy.

The CMA guidelines for marketing research include all of the following EXCEPT:
A) prohibiting selling under the guise of conducting research.
B) supporting research integrity.
C) encouraging fair treatment of clients and suppliers.
D) prohibiting fundraising under the guise of conducting research.
E) supporting efforts to overcome consumers’ concerns about privacy.

Conclusive research provides the information needed to confirm preliminary insights. Which of the following is NOT a conclusive data collection research
A) experiments
B) scanner
C) survey
D) projective techniques
E) panel

The major advantage of primary research data is it:
A) can be easily accessed through syndicated data bases or unstructured data mines.
B) can be tailored to meet the specific research needs.
C) take more time to collect than secondary data and is more costly.
D) are general enough to meet researchers’ and managers’ needs.
E) all of the above are advantages of primary research data.

Fred manages an upscale men’s clothing store. He wants more information about his customers’ opinions and feelings about upcoming fall styles. Fred will most likely use ___________________ to gather these data.
A) door-to-door surveys
B) focus group interviews
C) syndicated data
D) Sales invoices
E) Census data

A researcher will likely engage in exploratory research when:
A) data co-mingling.
B) the market research problem is not clearly defined.
C) syndicated marketing surveys provide sufficient information to address the research question.
D) conclusive research has been completed.
E) all of the above.

Wilma conducted a survey of liberal arts students on campus. She surveyed a representative sample of the students regarding their income and consumption patterns. Wilma can use the survey results to:
A) predict the income and consumption patterns of business students on campus.
B) predict the income and consumption patterns of all liberal arts students nationally.
C) estimate what percentage of liberal arts students will attend graduate school.
D) estimate income and consumption patterns among non-college students.
E) predict the income and consumption patterns of all liberal arts students on campus.

Vernice wants to know more about how people feel about her company’s product on an individual level? Which of the following research methods would be best in helping Vernice accomplish this research goal?
A) focus groups.
B) surveys.
C) MkIS.
D) primary data mining.
E) in-depth interviews.

Jerry is designing an online survey questionnaire. When designing the questionnaire, Jerry should consider which of the following?
A) be careful not to create misleading questions.
B) use language respondents are familiar with.
C) sequence the questions appropriately.
D) create a clear and easy to follow layout.
E) all of the above.

Compared to offline surveys, Web surveys benefit market researchers through:
A) relatively high response rates.
B) results can be processed and received quickly.
C) less lying by respondents.
D) it is inexpensive.
E) all of the above.

The following is NOT a step of the marketing research process:
A) Define the problem and objectives
B) Data collection
C) Analyze Data
D) Present results
E) Use quantitative methods

Chapter 6

Marketers often use principles and theories from sociology and psychology to:
  A) decipher many consumer actions and develop basic strategies for dealing with their behaviour.
  B) understand the historical significance of these disciplines in ancient marketing societies.
  C) avoid ethical dilemmas that might arise from consumers’ inner thoughts and motives.
  D) synthesize the important economic concepts into effective marketing communications.
  E) all of the above
The ______________________ represents the steps that consumers go through before, during, and after making purchases.
  A) habitual decision making system
  B) retrieval of evoked sets diagram
  C) consumer decision process model
  D) internal locus of control concept
  E) performance risk model
Which of the following factors affects consumers’ search processes?
  A) perceived benefits versus perceived costs of search
  B) locus of control
  C) actual or perceived risk
  D) type of product or service
  E) all of the above
Marketers love consumers who engage in habitual decision making, people who:
  A) critically evaluate choices and then choose their product.
  B) only spend a little time comparison shopping before buying their product.
  C) carefully avoid postpurchase dissonance.
  D) engage in reference group consumption.
  E) buy their company’s product with little thought or consideration of alternatives.
An attitude consists of the following three components:
  A) cognitive
  B) cognitive
  C) conative
  D) cognitive
  E) conative
Which of the following is NOT a step of the consumer decision process?
  A) postpurchase
  B) information search
  C) dissonance reduction
  D) evaluation of alternatives
  E) need recognition
Joanne likes expensive art, and will spend time trying to find her favourite artists. Her boyfriend, Sam, likes to have art filling empty spaces on his apartment’s walls. For Joanne art is a _____________ good while for Sam it is a _____________ good.
  A) shopping; specialty
  B) convenience; shopping
  C) convenience; specialty
  D) specialty; convenience
  E) unique; universal
The type of consumer buying decision where a consumer is highly involved in the purchase and perceives few differences between brands is called:
  A) complex buying behaviour
  B) dissonance reducing behaviour
  C) variety seeking behaviour
  D) habitual buying behaviour
  E) routine buying behaviour
Marketers are particularly interested in _____________behaviour because it entails actual rather than potential customers.
  A) compensatory
  B) ritual consumption
  C) need identification
  D) postpurchase
  E) extended problem solving
Marketers who set expectations too low could:
  A) tarnish the image of their product or service.
  B) create postpurchase exuberance.
  C) stimulate impulse buying.
  D) increase financial risk.
  E) redefine determinant attributes.
When consumers are dissatisfied, they:
  A) are less likely to say something than when they are satisfied.
  B) often want to complain to many people.
  C) want to buy more of the product to prove they were correct in their criticism.
  D) usually engage in a lawsuit.
  E) all of the above.
Which of the following is a psychological factor affecting the consumer decision process?
  A) learning
  B) motives
  C) attitudes
  D) perception
  E) all of the above
Maslow’s PSSP hierarchy of needs, from highest to lowest, are:
  A) personal, physiological, safety, social
  B) social, personal, physiological, safety
  C) physiological, safety, social, personal
  D) safety, social, psychological, personal
  E) personal, social, safety, physiological
Consumer perceptions are:
  A) their long-lasting attitudes.
  B) learning curve interpretation
  C) the process by which consumers select, organize, and interpret information.
  D) cultural norms developed over centuries and magnified during emigration.
  E) their postpurchase dissonance affective ideas.


Business-to-business marketing refers to buying and selling goods or services by all of the following except:
A) manufacturers.
B) producers.
C) retailers.
D) consumers.
E) wholesalers.

_________________ buy products from other businesses but do not significantly alter the form of the products they buy.
A) Producers
B) Consumers
C) Resellers
D) English auctioneers
E) Gatekeepers

The NAICS system can be quite useful to B2B marketers for:
A) establishing final consumer destinations.
B) consultative buying center simulations.
C) straight rebuy marketing.
D) interpersonal demand market segments.
E) segmenting and targeting their markets.

Compared to the B2C process, the information search and alternative evaluation steps in the B2B process are:
A) central planned.
B) subject to government regulation.
C) more formal and structured.
D) conducted before need recognition.
E) all of the above.

During the __________ stage of the buying process B2B buyers invite alternative suppliers to bid on supplying what is requested.
A) information search
B) need recognition
D) vendor analysis
E) all of the above.

While consumers weigh post-purchase dissonance, business buyers:
A) use reverse auctions to get rid of products they mistakenly purchased.
B) evaluate organizational culture.
C) conduct vendor analysis.
D) replace private exchange with public information systems.
E) elevate initiators and minimize the impact of influencers.

Which of the following is NOT one of the roles typically played by one of the members of a buying center?
A) reseller
B) initiator
C) influencer
D) decider
E) gatekeeper

Knowing which type of buying center is prevalent in a given organization helps sellers in all of the following ways EXCEPT:
A) how to organize a reverse auction.
B) how to deliver pertinent information.
C) to whom to deliver pertinent information.
D) to whom to make the sales presentation.
E) decide how to approach a particular client.

Knowing the roles of key players in the buying process could help a marketer:
A) experience a seller’s delight phenomenon.
B) misinterpret a NAICS report.
C) respond to an RFP too quickly.
D) avoid wasting a lot of time.
E) all of the above.

The B2B buying process can be influenced by:
A) the buying situation.
B) the buying center.
C) the organization’s culture.
D) all of the above.
E) none of the above.

In a ___________ B2B buying situation, the buying decision is likely to be quite involved.
A) new buy
B) modified rebuy
C) straight rebuy
D) either a new buy or a modified rebuy
E) all of the above

B2B salespeople often use the Internet to:
A) check on product availability.
B) check on order status.
C) confer with his sales manager about prices.
D) confer with his sales manager about discounts.
E) all of the above.

Private exchanges provide all of the following benefits to companies EXCEPT:
A) identify new sources of supply.
B) reduce paperwork.
C) allow faster response to the buyer’s needs.
D) reduce the frequency of negotiations.
E) save money.


A firm’s segmentation strategy must be consistent with and derived from the firm’s ___________________________ , as well as its current situation.
A) perceptual map
B) disclosure statement
C) mission and objectives
D) self-concept
E) lifestyle

If marketers are involved in mass customization, they are engaged in:
A) peripheral concentration.
B) concentrated self-concept development.
C) benefit assessment.
D) differentiated manipulation.
E) one-to-one marketing to the masses.

Demographic segmentation is the most common basis of consumer market segmentation, because these segments are:
A) easy to define and usually easy to reach.
B) psychographically distinct.
C) self-value, self-contained segments.
D) defined by the benefits consumers’ receive.
E) all of the above.

Marketers like Benetton want their ads to appeal to one’s _____________, suggesting to consumers “I’m like them, so I should buy their products.”
A) lifestyle.
B) self-concept.
C) business-to-business marketing
D) income.
E) demographics

Which of the following is NOT one of the VALS segments?
A) Innovators.
B) Experimenters.
C) Thinkers.
D) Achievers.
E) all of the above.

Because marketing is all about creating __________ for customers, dividing the market based on benefit segmentation can be quite useful.
A) profits
B) material consumption
C) psychographic satisfaction
D) value
E) ideal point identification

Lakeside Estates builds condominiums and targets consumers living in Edmonton who are over 50. Lakeside Estates is using _______________ segmentation.
A) benefit
B) self-actualization
C) psychographic
D) loyalty
E) geodemographic

One of the reasons marketers utilize ___________________ segmentation is the high cost of finding new customers.
A) geographic
B) benefit
C) psychographic
D) loyalty
E) geodemographic

Roger has identified four potential market segments for his Rent-A-Chef home meal catering service. He will then evaluate whether each segment is:
A) substantial.
B) responsive.
C) profitable.
D) reachable.
E) all of the above.

If the customers in a segment react similarly and positively to the firm’s marketing mix, that market segment is said to be:
A) substantial.
B) perceptive.
C) responsive.
D) reachable.
E) identifiable.

Which of the following would be used in calculating the profitability of a segment?
A) fixed costs.
B) segment size.
C) segment adoption percentage.
D) profit margin percentage.
E) all of the above.

When selecting a target market, a marketer should:
A) determine a customer’s objective.
B) describe past market segments.
C) evaluate the attractiveness of each consumer.
D) Match the firm’s competency with a market segment’s attractiveness.
E) identify a positioning strategy.

Whenever Darrah calls on potential office supply customers, she emphasizes the fact that, unlike the national franchise competitors, she is a local business person and has been in business over twenty years. Darrah is _______________ her business relative to her competition.
A) prospecting
B) customizing
C) positioning
D) pricing
E) creating symbolic associations of

______________ is a strategy through which a firm targets several market segments with a different offering for each
A) Differentiated segmentation strategy
B) Concentrate segmentation strategy
C) Undifferentiated segmentation strategy
D) Positioning strategy
E) Targeting strategy

Gillette’s following ad jingles: “the best a man can get” is an example of ______________ positioning strategy.
A) Product attributes
B) leadership
C) value
D) symbolism
E) benefits


Within each product line, there are often multiple:
A) product categories.
B) primary packaging parts.
C) product breadth.
D) product assortment.
E) private label brands.

A ________________ signals to consumers that a product is available without using words.
A) name
B) symbol
C) phrase
D) term
E) all of the above

The SKU is the:
A) product power divided by the stock keeping union.
B) product line breadth.
C) product statistical keeping unit.
D) smallest product unit, used for inventory control.
E) brand depth.

Firms often add new product categories to do all of the following EXCEPT:
A) capture new markets.
B) respond to evolving markets.
C) increase sales.
D) compete in new venues.
E) increase price incentives.

From time to time it is necessary for marketers to _______________ in order to realign resources.
A) delete product lines or categories
B) expand consumers’ attention
C) lower brand equity
D) raise perceived value
E) measure SKU effectiveness

Chianti that comes in wicker-clad bottles and tortillas that come in zip lock bags are examples of brand _____________ that differentiate these companies’ products from their competitors’ offerings.
A) names
B) slogans
C) symbols
D) characters
E) packaging

One of the dangers of hiring celebrities like Mel Gibson to endorse a company’s products is that when they engage in embarrassing behaviour, to the degree that they are associated with the company’s brands, their actions hurt:
A) brand equity.
B) brand awareness.
C) brand recognition.
D) corporate brand category depth.
E) all of the above.

Brand awareness matters most for products that are:
A) not purchased in packages.
B) equitably distributed among the world’s consumers.
C) associated with scientific activities.
D) not desired by consumers.
E) bought without much thought, such as bread and candy.

If consumers think that the discount store with the lowest prices on food is going to have the lowest prices on all goods, the discount store has achieved positive:
A) perceived value
B) brand awareness
C) brand loyalty
D) generic positioning
E) brand association

Disneyworld ads showing Mickey and Donald and families enjoying wholesome entertainment effectively create a:
A) product line depth chart.
B) brand persuasion.
C) brand association.
D) brand personality.
E) primary service packaging.

Which of the following is a potential benefit of brand extension?
A) It allows the perception of a brand with a quality image to be carried over to the new product.
B) It lowers marketing costs.
C) It can boost sales of the core brand.
D) The firm can spend less on creating brand awareness and associations.
E) all of the above.

_____________ occurs when a brand extension adversely affects consumer perceptions about the attributes the core brand is believed to hold
A) Brand licensing
B) Brand dilution
C) Brand obsolescence

D) Cobranding
E) Brand repositioning

Which of the following is NOT likely to be included in a brand licensing agreement
A) Brand name
B) logo
C) symbols
D) Royalties
E) Retail price


_______________ turns ideas into tangible products.
A) Scientific research
B) Technological research
C) Brainstorming
D) Enlightenment
E) Visual marketing

New products allow a firm to:
A) go beyond marketing only to current customers or similar customers.
B) diversify into old product lines.
C) focus on product reincarnation.
D) decrease their prices because that is all they offer.
E) focus more on competitors’ alternatives.

Atari was a pioneer in the electronic game market, which:
A) allowed competitors to focus on creating demand for their brand.
B) paved the way for PlayStation in that product category.
C) allowed other competing firms to spend less on introductory advertising.
D) allowed competitors to focus on making improved versions.
E) all of the above.

The ____________________________ focuses on the rate at which consumers are likely to adopt a new product or service.
A) geographic boundary of innovation doctrine
B) laggards to innovators movement
C) psychological innovators syndrome
D) diffusion of innovation theory
E) all of the above.

Which of the following is NOT one of the characteristics that affect new product diffusion?
A) Relative advantage
B) Compatibility
C) Observability
D) Electability
E) Trialability

The group of consumers in the diffusion of innovation model that represents approximately 34 percent of the population; members don’t like to take much risk and therefore tend to wait until bugs are worked out is called:
A) early majority
B) late majority
C) laggards
D) early adopters
E) innovators

During __________________________, moderators will likely channel participants’ attention to product features, performance expectations, packaging, or product attributes.
A) licensing agreement negotiation
B) decline stage breakout sessions
C) product life cycle debates
D) test marketing performance analysis
E) brainstorming sessions

Valerie is involved in ___________________, taking apart a competitor’s product, analyzing it, and trying to create an improved product that does not infringe on the competitor’s patents.
A) spinning
B) reverse engineering
C) selective dissection
D) redistribution
E) creative destruction

During ______________ for a new product, a marketer will likely ask consumers whether they would buy the product, how frequently would they purchase it, and whether consumers think it is a good value for the price being suggested.
A) concept testing
B) test marketing
C) cognitive recall analysis
D) prototype design
E) all of the above.

When Red Lobster comes up with a new entrée for its restaurants, they often market it in a dozen or so of their outlets. When they do this, they are engaged in:
A) pretesting
B) product launch
C) test marketing
D) product development
E) evaluation of results

Reginald is assessing the results of a recent books-on-tape new product launch for his bookstore. When evaluating the results, Reginald will likely consider:
A) where in the store to display the new product line.
B) are the books-on-tape generating the expected level of profit.
C) are the books-on-tape generating the expected level of sales.
D) are her customers interested in the new products.
E) all of the above.

Which of the following is the correct order for the product life cycle?
A) introduction, maturity, decline, growth.
B) introduction, growth, maturity, decline.
C) introduction, growth, decline, maturity.
D) growth, introduction, maturity, decline.
E) decline, growth, introduction, maturity.

The stage of the product life cycle when the product gains acceptance, demand and sales increase, and competitors emerge in the product category is called:
A) Introduction stage
B) Growth stage
C) Maturity stage
D) Decline stage
E) Development stage

The typical consumers at the majority stage of the product life cycle could be called:
A) innovators
B) laggards
C) Late majority
D) Early adopters
E) Early majority


Many hotels use _________________ to overcome the problem of inseparability of services.
A) promotional discounts
B) satisfaction guarantees
C) perishability gap analysis
D) point-of-purchase displays
E) zone of tolerance allowances

Because services like airline flights and hotel beds are perishable, many marketers attempt to match demand with supply using:
A) logistical management.
B) magazine advertising.
C) tangibility promotions.
D) pricing strategies.
E) product vouchers.

The _______________is designed to highlight those areas where customers believe they are getting less or poorer service than they should.
B) Manufacturers’Quality
C) Gaps Model
D) Service Allocation Model
E) Distributive Fairness Model

Firms can close the knowledge gap by:
A) Allowing senior employees to instruct entry-level workers.
B) matching customer expectations with actual service through research.
C) employing a maximum utility standards performance gap.
D) setting reasonable delivery dates.
E) all of the above.

Firms can attempt to close a standards gap by:
A) offering discounts to dissatisfied customers.
B) increasing consumers’ knowledge.
C) setting appropriate service standards and measuring service performance.
D) coordinating service delivery with production scheduling.
E) communicating systematic socially responsible service policies.

Which of the following is one of the five dimensions used by consumers to determine overall service quality.
A) assurance.
B) reliability.
C) empathy.
D) responsiveness.
E) all of the above

To develop a zone of tolerance analysis, a market researcher would likely ask customers about all of the following EXCEPT:
A) their desired level of service for each of the five service quality dimensions.
B) their ethnicity and marital status.
C) how well the firm performs in each service quality dimension.
D) the importance of each service quality dimension.
E) their expected level of service for each of the five service quality dimensions.

Dino is training service providers to know exactly what a “good job” entails. Dino is setting service:
A) knowledge.
B) standards.
C) delivery.
D) quality.
E) empowerment.

The difference between the firm’s service standards and the actual service it provides to customers is known as:
A) knowledge gap
B) quality gap
C) communication gap
D) standard gap
E) delivery gap

The communication gap pertains to:
A) knowledge differences among consumers.
B) the difference between the service promised and the service actually delivered.
C) delivery date differentials based on zone pricing.
D) standard communication practices compared to regional communication practices.
E) errors in promotional messages causing misinterpretation among large segments of the target market.

Which of the following is NOT one of the four core difference between services and goods
A) intangible
B) innovative
C) inseparable
D) perishable
E) variable

Effective service recovery efforts can significantly help increase the following:
A) customer satisfaction
B) purchase intentions
C) positive word of mouth
D) all of the above
E) none of the above

Marketing Sample Midterm!

MKTG 1102 Midterm Sample Questions


MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
1) People who study demographics assume 1) ______
A)  demographics tell universal truths about people everywhere in the world.
B)  people at certain ages and levels of income want the same things.
C)  their findings reveal the microenvironment.
D)  their findings tell everything there is to know about people.
E)  demographics are complex.
2) At what point in the market segmentation, targeting, and positioning process does the firm develop a marketing mix for each segment? 2) ______
A)  market targeting
B)  market positioning
C)  prior to the process starting, in the marketing strategy phase
D)  market segmentation
E)  none of the above
3) A(n) ________ is a form of product that consists of activities, benefits, or satisfactions offered for sale that are essentially intangible and do not result in the ownership of anything. 3) ______
A)  demand
B)  experience
C)  physical object
D)  service
E)  need
4) A ________ is any group that has an actual or potential interest in or impact on an organization’s ability to achieve its objectives. 4) ______
A)  competitive set
B)  shareholder
C)  supplier
D)  marketing intermediary
E)  public
5) The 2500 kilograms of steel, rubber, glass, plastic, and leather contained within the functional form of a sports car would be considered which of the following levels of product? 5) ______
A)  core product
B)  physical product
C)  tangible product
D)  actual product
E)  augmented product
6) HarleyDavidson spends a great deal of time thinking about who their customers are, what they think and feel, and why they choose a Harley over all of the other motorcycle brands available to them. HarleyDavidson is therefore interested in the ________ for their product. 6) ______
A)  market segment buying
B)  segmentation analysis
C)  consumer buyer behaviour
D)  business buying behaviour
E)  target market buying
7) As the majority of human behaviour is learned, ________ is the most basic cause of a person’s wants and behaviours. 7) ______
A)  instinct
B)  social class
C)  culture
D)  personality
E)  lifestyle
8) According to the BCG growthshare matrix portfolioplanning method, a company’s strategic business units can be evaluated in terms of their ________. 8) ______
A)  market growth rate and their expansion curve tendency
B)  market growth rate and their relative profitability
C)  market growth rate and capitalization structure
D)  structure and target markets
E)  market growth rate and relative market share
9) WalMart has become the world’s largest retailer by delivering on its promise, “always low pricesalways.” This would be an example of the marketing philosophy that says 9) ______
A)  “sell low and make it up on volume.”
B)  “always take discounts and pass some of them on to consumers.”
C)  “distribution is the secret to all conquests in marketing.”
D)  “buy cheap, sell cheap.”
E)  “take care of your customers, and market share and profits will follow.”
10) “Coke in the morning” is an attempt to segment according to which of the following? 10) ______
A)  benefit segmentation
B)  occasion segmentation
C)  gender segmentation
D)  drug use segmentation
E)  psychographic segmentation
11) Josh Nielsen has decided to sell demonstration ski equipment that he has obtained from a Head Ski salesperson via eBay using its auction feature. Which of the following Internet domains would most accurately describe the form of business Josh is using? 11) ______
A)  C2C
B)  C2E
C)  B2B
D)  C2B
E)  B2C
12) One of the most common problems with using internal information is that 12) ______
A)  it often reflects the biases of those who generated it.
B)  it is usually expensive and time consuming to retrieve.
C)  top executives are usually unwilling to relinquish data, therefore, the data has limits.
D)  the data is almost always unsecured and, therefore, suspect as to reliability.
E)  since it was probably collected for some other purpose, it may be incomplete or wrong for the intended use.
13) Today, marketing must be understood in a new sense that can be characterized as 13) ______
A)  “satisfying customer needs.”
B)  “catering to the older consumer.”
C)  “get there first with the most.”
D)  “management of youth demand.”
E)  “telling and selling.”
14) Which of the following benefits does provide book buyers with, that traditional retailers find most difficult to match? 14) ______
A)  The Internet is interactive and immediate.
B)  The Internet can be convenient.
C)  The Internet can always provide the lowest prices on merchandise.
D)  The Internet can provide buyers with greater product access and selection.
E)  The Internet can be a faster way to communicate to large groups.
15) When using portfolio analysis, if an organization were to identify a unit that has a separate mission and objectives and that can be planned independently from other company businesses, it would be called a ________. 15) ______
A)  strategic business unit (SBU)
B)  business development unit (BDU)
C)  product/market expansion unit (PMU)
D)  standard control unit (SCU)
E)  strategic control unit (SCU)
16) ________ is(are) the systematic collection and analysis of publicly available information about competitors and developments in the marketing environment. 16) ______
A)  Secondary research
B)  Marketing intelligence
C)  Situational analysis
D)  Competitor analysis
E)  Marketing research

Marketing Notes for Midterm #1


Marketing Chapter 1

Marketing a set of business practises designed to plan for and present an organizations products or services in ways that build effective customer relationship
Marketing is about Satisfying Customer needs and wants
Needs a person’s feeling physiologically deprived of basic necessities such as food, clothing, shelter and safety
Wants the particular way in which a person chooses to satisfy a need which is shaped by a person’s knowledge, culture, and personality
Market is the group of people to whom an organization is interested in marketing its products, services or ideas.
Target market: the customers segment of group to whom the firm is interested in selling its products and services; potential customers who have both an interest in the product or service and an ability to buy
Exchange: the trade of things of value between the buyer and the seller so that each is better off as a result
Market Mix: the controllable set of activities that the firm uses to respond to the wants of its target market 4P’s

Product creating value in the form of  goods, services , and ideas that will satisfy the customer’s needs ( Brand – Size – Quality – Features  etc)

  • Goods are the items that you can physically touch
  • Services are intangible customer benefits that are produced by people or machines and cannot be separated from the producers , air travel, banking insurance etc.
  • Ideas  include thoughts opinions philosophies and intellectual concepts that are marketed

Price Transacting Value the overall sacrifice a consumer is willing to make – money , time , energy to acquire a specific product or service.
Place Delivering Value describes all the activities necessary to get the product from the manufacturer or producer to the right customer. developing an efficient system for merchandise to be distributed in the right quantities to the right location, and at the right time in the most efficient way in order to minimize system wide costs while satisfying the service level required.

Promotion Communicating Value   can enhance a product or service’s value, by communicating  to the valued customers , Advertising public rations direct marketing and electronic media

  • External forces such as social , technology , economic , regulatory , competitors , and demographics all shape a company’s marketing activities
  • Marketing can be performed by both individuals and organizations
    • B2C Business to consumers
    • B2B Business to business
    • C2C Consumer to Consumer
  • Marketing occurs in many settings
    • Jumpstart the economies of less developed countries to  bring buyers and sellers together
    • Non profit groups also benefit from good marketing spreading news about their cause.

  • Production- oriented Era
  • Sales Oriented Era
  • Market Oriented Era
  • Value based Marketing Era
    • Value  reflects the relationship of benefits to costs, or what the consumer gets for what he or she gives
    • A business must understand what customers view as the key benefits of a given product or service and how to improve on them.
    • Value Get (benefits =  time and money )
    • Isn’t just about  creating  strong products and services it should be a core function of the company
      • Build Value
        1. Sharing information  in a value based marketing oriented firm , marketers share information about customers and competitors that has been collected through customer relationship management
        2. Balancing benefits with costs constantly measure the benefits that customers perceive against the cost of their offering.
        3. Building relationship with customers
          1. Transactional orientation regards the buyer seller relationship as a series of individual transaction so anything that happened before or after the transaction is of little importance.
          2. Relational ship orientation a method of building a relationship with customers based on the philosophy that buyers and sellers should develop a long tern relationship
          3. Customer relationship management a set of strategies, programs, and systems that focus on identifying and building loyalty among the firms most valued customers.
        • Create value for customers and build customer relationship
          1. Understand the marketplace and customer needs and wants
          2. Design a customer driven marketing
          3. Construct a marketing program that delivers superior value
          4. Build profitable relationships
          5. Capture value from customers to create profits and customer equity
      • Marketing process in a summary

Chapter 2 Developing marketing Strategies

  • Strategic marketing planning process a set of steps to develop a strategic marketing plan
  • Planning phase in this phase top management define the mission or vision of the business, evaluate the situation by assessing how various players, both in and outside the organization affect the firm’s potential for success and identify and evaluate different opportunities by engaging in segmentation targeting and positioning and develop the marketing mix.
  • Implementation phase where marketing manages implement the marketing mix , allocate resources, and develop the marketing organization
  • Control phase the part of the strategic marketing planning process when mangers evaluate the performance of the marketing strategy and take any necessary corrective actions.
  • Mission Statement – A broad description of a firm’s objectives and the scope of the activities it plans to undertake; attempts to answer two main questions:  What type of business is it? What does it need to do to accomplish its goals and objectives?
    • Are specific
    • Are realistic
    • Are motivating
    • Are customer centric
    • Fit the market environment
    • Are based on distinctive competencies
  • Sustainable competitive advantage, namely ,something the firm can persistently do better than their competitors

STP( Segmentation, Targeting and positioning )
Is the process that firms use to identify and evaluate opportunities for increasing sales and profits.

  • Market segment a group of consumers who respond similarly to a firm’s marketing efforts
  • Market segmentation the process of dividing the market into groups of customers with different needs, wants, or characteristics – who therefore might appreciate products or services geared especially for them.


  • The process of evaluating the attractiveness of various segments and then deciding which to purse as a market.


  • Involves the process of defining the marketing mix variables so that target customers have a very clear, distinctive, desirable understanding of represents in comparison with competing products.

Developing marketing mix

  1. Product and value creation – products, which include services, constitute the first of the 4ps’, because the key to the success of any marketing program is the creation of value, firms attempt to develop products and service that customers perceive as they are valuable enough to buy the product.
  2. Price and value for Money –a firm provides a product or a service, or a some combination thereof, and in return it receives money. Value based marketing requires that firms charge a price that customers perceive as giving them good value for the products and services
    1. Cost based pricing a pricing strategy that involves first determining the costs of producing of providing a product and then adding a fixed amount above the total to arrive at the selling price
    2. Competitor-based pricing A strategy that involves pricing below, at, or above the competitors’ offering
    3. Value-based pricing a pricing strategy that involves first determining the perceived value of the product from the customers point of view and then pricing accordingly
  3. Place and Value Delivery-the firm must be able to, after it has created value through a product and / or service , make the product or service readily accessible when a where the customer wants it .
  4. Promotion and Value Commutation is the process that the marketers communicate the value of their offering or the value proposition, through many media forms.

Implement the marketing mix: allocating Resources

  • Strategic business unit-A division of the firm itself that can be managed and operated somewhat independently from other divisions and may have a different mission or objectives.
  • Product line –A group of products that consumers may use together or perceive as similar in some way
  • Relative market share – A measure of the product’s strength in a particular market, defined as the sales of the focal product divided by the sales achieved by the largest firm in the industry.
  • Market growth rate The annual rate of growth of the specific market in which the product competes

Growth Strategies

  • Market Penetration Strategy employs the existing marketing mix and focuses the firm’s efforts on existing customers
  • Market development strategy a growth strategy that employs the existing marketing offering to reach new market segments, whether domestic or international
  • Product development strategy a growth strategy that offers a new product of service to a firm’s current target market
  • Diversification strategy- a growth strategy whereby a firm introduces a new product or service to a market segment that it does not currently serve.

Stars occur in high growth markets and are high market share
Cash cows are in low growth markets but have high market shares
Question marks appear in high growth markets but have relatively low market shares
Dogs are in low growth markets and have relatively low market shares

Macro Strategies – or overarching strategies, focus on elements of excellence to create and deliver value and to develop sustainable competitive advantages.

  • Customer excellence which focuses on retaining loyal customers and excellent customers service.
  • Operational excellence through efficient operations and excellent supply chain management.
  • Product excellence or achieving high-quality products; effective branding and positioning are key.

New growth strategies that companies can implement


Midterm Practice #1 Solutions

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(5-10 min.) E 3-6

  a. Amortization Expense 5,000
    Accumulated Amortization     5,000
  b. Insurance Expense   500  
    Prepaid Insurance     500
  c. Interest Expense   400  
    Interest Payable     400
  d. Salary Expense ($16,000 × 4/5)   12,800  
    Salary Payable     12,800
  e. Unearned Service Revenue   2,000  
    Service Revenue     2,000


Req. 2                                                                                                             (continued) P 3-4A

    Adjusting Entries at December 31, 2010
  a. Unearned Printing Revenue      
    ($2,400 – $800)   1,600  
    Printing Revenue     1,600
  b. Rent Expense ($4,500 – $3,000)   1,500  
    Prepaid Rent     1,500
  c. Supplies Expense   450  
    Supplies     450
  d. Amortization Expense––Furniture      
    and Equipment   160  
    Accumulated Amortization––Furniture      
    and Equipment     160
  e. Miscellaneous Expense   200  
    Accounts Payable     200
  f. Salary Expense   1,875  
    Salary Payable     1,875


Kaplan Printing
Adjusted Trial Balance
December 31, 2010
Cash 5400       $  5,400  
Accounts receivable 18,600       18,600  
Prepaid rent 4,500     b) 1500 3,000  
Supplies 1,200     c) 450 750  
Furniture and equipment 19,200       19,200  
Accumulated amortization––furniture and equipment   5,760   d) 160   $  5,920
Accounts payable   3,400   e) 200   3,600
Salary payable   0   f) 1875   1,875
Unearned printing revenue   2,400 a)     1600     800
S. Kaplan, capital   23,140       23,140
S. Kaplan, withdrawals 6,000       6,000  
Printing revenue   36,500   a)     1600   38,100
Salary expense 12,500   f) 1875   14,375  
Rent expense 0   b)    1500   1,500  
Amortization expense––furniture and equipment 0   c)     160   160  
Advertising expense 3,600       3,600  
Supplies expense 0   d)    450   450
Miscellaneous Expense 200   e)     200   400
Total 71,200 71,200 $73,435 $73,435



Accounting Practice Midterm #1

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Note:  These are exercises and problems from Chapter 3 in the textbook.  I’ve put them in a similar format to the midterm with time guidelines.

Exercise 3-6 (This would be worth about 10 marks – about 10 minutes)

Journalize the entries for the following adjustments at January 31, the end of the accounting period:

a)      Amortization, $5000

b)      Prepaid insurance expired, $500

c)       Interest expense accrued $400

d)      Employee salaries owed for Monday through Thursday of a five day workweek, weekly payroll of $16,000

e)      Unearned service revenue that becomes earned $2000

General Journal




Problem 3-4A – see below for required (18 marks – about 18 minutes)

Kaplan Printing
Adjusted Trial Balance
December 31, 2010
Cash 5400          
Accounts receivable 18,600          
Prepaid rent 4,500          
Supplies 1,200          
Furniture and equipment 19,200          
Accumulated amortization––furniture and equipment   5,760        
Accounts payable   3,400        
Salary payable   0        
Unearned printing revenue   2,400 a)      
S. Kaplan, capital   23,140        
S. Kaplan, withdrawals 6,000          
Printing revenue   36,500   a)    
Salary expense 12,500          
Rent expense 0   b)      
Amortization expense––furniture and equipment 0   c)      
Advertising expense 3,600          
Supplies expense 0   d)    
Miscellaneous Expense 200   e)  
Total 71,200 71,200  


Adjustment data:

a)      Unearned printing revenue still remaining to be earned at Dec 31 is $800

b)      Prepaid rent still available at Dec 31 is $3000

c)       Supplies used during the month $450

d)      Amortization for the month, $160

e)      Accrued miscellaneous expense at Dec 31, $200 (credit Accounts Payable)

f)       Accrued salary expense at Dec 31, $1,875


  1. Journalize the adjusting entries in the space below
  2. Prepare the adjusted trial balance.



Req. 2                                                                                                             (continued) P 3-4A