Transcript MTTC Preparation - Eastern Michigan University

MTTC Preparation
MTTC # 98

Next test date is January 13, 2007
 Regular
registration deadline is December 1, 2006
 http://www.mttc.nesinc.com/

Additional test dates: April 14 & July 7, 2007
 Register
by: March 2 and May 25, 2007 respectively
Preparation Resources

MTTC study guides
 http://www.mttc.nesinc.com/MI_viewSG_opener.asp
 Mail

order through MTTC registration bulletin
EMU Business Content Guidelines /
Standards Matrix
 http://www.emich.edu/coe/program_update/bus_ed/m
atrix.html

Peers, Textbooks, Internet, Spark Charts
Test Organization

Areas include:




Business
Management
Marketing
Technology
25%
25%
25%
25%

Test is not organized by area

October was the first time the test was offered

100 questions – but not all are counted for your score
Business
Accounting Cycle
8. Prepare Post-Closing Trial
Balance
7. Post Adjusting & Closing
Entries
6. Journalize Adjusting &
Closing Entries
5. Prepare Financial
Statements
1. Analyze Transactions
2. Journalize
3. Post
4. Prepare Work Sheet
Accounting Equation

Assets=Liabilities + Owner’s Equity
______Debit_____________Credit_______
T-accounts are your friends

Assets
T-accounts are your friends

Liabilities
T-accounts are your friends

Owner’s Equity
Cash vs. Accrual
Cash – Income is recognized as cash is
received and expenses are recognized as
cash is paid
 Accrual – Income is recognized as it is
earned and expenses are recognized as
they are incurred.
 Matching concept – Income and expenses
are recognized in the same period

Analyze transactions & journalize

Source documents
 Invoices
 Check
register
 Bills and more

Journals
 Cash
receipts, Accounts payable, Accounts
receivable, Purchases, etc.
Posting
General ledger
 Symbolized using T-accounts

Judy's Car Wash
Worksheet
August 31, 2006
1
2
TRIAL BALANCE
ACCOUNT TITLE
DEBIT
CREDIT
3
4
5
ADJUSTMENTS
DEBIT
6
INCOME STATEMENT
CREDIT
DEBIT
CREDIT
7
8
BALANCE SHEET
DEBIT
CREDIT
1
Cash
2
Accounts Receivable
3
Supplies
4
Prepaid Insurance
5
Accounts Payable
1040.00
1040.00
5
6
Judy Spreen, Capital
7860.00
7860.00
6
7
Judy Spreen, Drawing
8
Income Summary
9
Sales
10
Advertising Expense
11
Insurance Expense
12
Miscellaneous Expense
13
Supplies Expense
14
Utilities Expense
15
8600.00
8600.00
1
500.00
500.00
2
1100.00
(a) 500.00
600.00
3
340.00
(b) 220.00
120.00
4
1600.00
1600.00
7
8
5600.00
5600.00
500.00
(b) 220.00
260.00
(a) 500.00
1600.00
14500.00
14500.00
720.00
720
9
500.00
10
220.00
11
260.00
12
500.00
13
1600.00
14
3,080.00
16
2,520.00
17
5,600.00
5,600.00
5,600.00
11,420.00
11,420.00
8,900.00
15
2,520.00
16
11,420.00
17
18
18
19
19
Financial Statements
Balance Sheet
 Income Statement
 Statement of Cash Flows

Balance Sheet

Assets
 Current Assets
 Fixed Assets
 Other Assets

(long-term)
Liabilities
 Current
Liabilities
 Long-term Liabilities

Owner’s, Stockholders’, Partner Equity
Income Statement
Revenue
 Cost of Goods Sold
 Gross Profit
 Expenses
 Net Operating Income
 Non-operating income expense
 Net income/loss

Adjusting & Closing entries

Adjusting entries
 Prepared
from Worksheet
 To accomplish matching principle

Closing entries
 Close




temporary accounts
Revenue (and other income stmt accts w/credit
Expenses (and other income stmt debits
Income summary
Drawing account (sole proprietors and partners)
Math to solve business problems
Decimals
 Fractions
 Percents
 Ratios
 Proportions
 Algebra


See math textbook
Statistical calculations

Mean= Average

Median= Middle

Mode= Most often
Personal Finance-objectives

Personal finance plan
 Debt
management
 Investment options
 Credit
 Consumerism
Personal finance-objectives
How to manage economic risks
 Using a rational decision-making process

 Citizens
 Workers
 Consumers
C. Apply principles of law to
business situations
Understanding the role of government in
regulating business
 The structure of the court system
 Classifications of procedural law
 Classifications of substantive law

U.S. Supreme Court
U.S. Court of Appeals
U.S. Court of Appeals
(11 Territorial Circuits
and DC Circuit)
Fed. Admin
Agencies
U.S. District
Courts
(96 districts)
U.S
Bankruptcy
Courts*
(Federal Circuit)
U.S. Tax
Court*
U.S. Claims
Court*
U.S. Court
Of
Internat.
Trade*
U.S. PTO
Substantive vs. Procedural Law
Substantive (Policy)
Procedural (Method of
Enforcement)
Administrative Law
Agency
Bailments
Commercial Paper
Constitutional Law
Contracts
Corporation Law
Criminal Law
Insurance
Partnerships
Personal Property
Real Property
Sales
Taxation
Torts
Trusts and Wills
Administrative Procedure
Appellate Procedure
Civil Procedure
Criminal Procedure
Evidence
C. Apply principles of law to
business situations





Relationships: contract, sales, consumer, employment,
and agency laws
Understanding laws related to commercial paper,
insurance, secured transactions, and bankruptcy
Understanding laws regarding personal property, real
property, and intellectual property
Analyzing the relationship between ethics and the law
Applying U.S. and other law to national and international
markets
E. Apply principles of business
communication
Communicate effectively on both personal
and professional levels
 Identifying the concepts, strategies, and
systems needed to interact effectively with
others

E. Apply principles of business
communication
Applying appropriate social
communication skills in personal and
professional situations, including cover
letters and resumes in a global
environment
 Using appropriate technology to enhance
the effectiveness of communications

E. Apply principles of business
communication
Demonstrating appropriate leadership,
supervisory, customer service, and ethical
standards to communicate effectively with
business constituents
 Demonstrating communication strategies
necessary for effective international
business relations.

Management
A. Understand types,
structures & functions of
business management
Includes demonstrating leadership,
communication, planning, controlling,
organizing, problem-solving, and self
management skills
 Demonstrating an understanding of
professional ethics and social
responsibility in business

Management
B. Understand HRM, labor relations, and the
role of corporate, group, and interpersonal
behavior in business mgmt.
Applying human resource principles,
systems, and contingency approaches to
actual management scenarios
 Recognizing human resource practices to
legally and effectively manage a diverse
workforce

Management
B. Understand HRM, labor relations, and the
role of corporate, group, and interpersonal
behavior in business mgmt.

Apply social theory (e.g. group dynamics,
work groups, roles within teams, conflict
resolution methods) to the workplace
Economics
Opportunity Cost

Whatever must be given up to obtain
some item

“There’s no such thing as a free lunch”
 Links
scarcity, choice, and cost
Production Possibilities Curve (PPC)

Maximum combination of two outputs that an
economy can produce given available resources
and technology.
Law of Increasing Opportunity Costs

Opportunity costs increase as the production of
one output expands.
Shifting the Production Possibility Curve

Shift in PPC occurs with a change in:
 Physical
Capital
 Human Capital
 Natural Resources
 Technology
Supply, Demand & Equilibrium
Law of Demand
Change in
Quantity
Demanded

Inverse relationship between price and quantity
buyers are willing to purchase
Source: fashiontribes.com
Change in Demand

Change in quantity demanded at each possible
price
Source: fashiontribes.com
Law of Supply
Price of Jeans
Change in
Quantity
Supplied
Quantity of Jeans

Direct relationship between price and quantity
Source: www.sparknotes.com
Change in Supply

Change in quantity supplied at each possible
price
Source: www.sparknotes.com
Equilibrium
SURPLUS
Invisible
Hand Theory
SHORTAGE

Market condition that occurs when quantity
demanded = quantity supplied
Source: www.sparknotes.com
Monetary Policy
Federal Reserve System
Monetary Policy
Key U.S. Economic Measures
Gross Domestic Product (GDP)

The market value of all final goods and services
produced in a nation during a given period of time,
usually a year.

Expenditure Approach
 GDP = C + I + G + (X-M)
Consumption
 Gross Private Domestic Investment
 Government Consumption Expenditures and Gross
Investment
 Net Imports (Exports – Imports)

GDP

Income Approach = Compensation of
employees + Rents + Profits + Net Interest
+ Non income adjustments

Income Approach = Expenditure Approach
GDP

Nominal GDP = production of goods &
services valued at current prices

Real GDP = production of goods &
services valued at constant prices
Types of Unemployment

Seasonal

Structural

Frictional

Cyclical
Unemployment

Rate = (# of unemployed / labor force) x 100

Labor force = total number of workers including
both the employed and unemployed

Not in the labor force
 Retirees
 Homemakers
 Full-time
student
Employment

Full employment does NOT mean 0%

GDP Gap = Cost of Cyclical Unemployment

Potential real GDP – Actual real GDP
Inflation

Based on % change of Consumer Price Index

Inflation = increase in average price level of goods
and services
 Demand-Pull
= increase due to excess of total spending
 Cost Push = increase due to cost of production.

Deflation = decrease in average price level of
goods and services

Nominal & Real Interest Rates
Rational Expectations

Theory= people use all information they
have when forecasting future, including
government policies

Applicable for inflation and unemployment
tradeoff
Economic Systems,
Competition & Risk
Economic Systems

Capitalism – private ownership of resources and
markets and decentralized decision making

Socialism – government ownership of resources
and centralized decision-making

Communism – all factors of production owned by
workers and people share in production
according to their needs
Competition
Competitive Market = many buyers and
sellers with little impact on market price
 Other types of Markets:

 Monopoly
 Oligopoly
 Monopolistically
Competitive
Risk
Most people are risk adverse
 Insurance


Diversification
 Idiosyncratic
risk is eliminated
 Aggregate risk is not
International Trade &
Global Economy
International Strategy
Opportunity
Strategy
Entry
Increased
Market Size
Multidomestic
Exporting
Global
Licensing
ROI
Transnational
Strategic
Alliance
Economies of
Scale
Advantage in
Location
Acquisition
New
Subsidiary
Risks

Political
 Government

regulation, legal authorities
Economic
 Currency
fluctuations, trade barriers, trade
agreements (i.e. NAFTA)
Marketing
Fundamental Concepts
The marketing concept is the idea that
companies should determine the needs of
their customers and meet them better than
the competition.
 What do customers want?
 Can we develop it while they still want it?
 How can we keep customers satisfied?

Effective Interaction with Others

Focus on positive interaction with clients

Positive interaction with other employees
also important

TWO HEADS ARE BETTER THAN ONE!
Economics and Marketing
Supply and demand affects production
 Market Equilibrium

S
Price
D
Quantity
Career Exploration and
Development

Types of Careers in Marketing
 Sales
 Market
Research
 Advertising & PR
 Retailing
 Product Management

www.careers-in-marketing.com
Finances and Decision Making

How are decisions made based on
finances?
 Do
we have enough money?
 Do we have extra money?
 What can we cut?
 What can we add?
 What price should we charge for our
product/service?
Marketing Research

WHY HAVE MARKETING RESEARCH
(benefits, etc.)?

WHAT CAN WE LEARN FROM
MARKETING RESEARCH (consumer,
competitor, etc.)?
Pricing and Maximizing Return

Price and ROI

Company Profit

Don’t Overcharge Customers
Product Mix and Market
Opportunities

Target Market

Marketing Research

SWOT Analysis

New Product?

New Model?
Concepts and Strategies Needed
to Communicate Information
Business Letters, E-mail, Memos, etc.
 Marketing/Introduction Letters
 Advertising
 Grammar, Spelling, Structure,
Professionalism
 Face-to-face: Don’t forget to listen!

Technology and Marketing

Internet





Organization


One-Note, etc.
Data Input



E-mail
Web page banners
Customer service Web page
Travel/Laptops
Tablet PC
Voice Input
Movie Maker
The owner of a hat shop pays $22.75 for a
hat that sold for a retail price of $32.50.
What approximate percent of the retail
price is the markup on this hat
a. 43%
b. 33%
c. 30%
d. 10%


A.
B.
C.
D.
A consumer electronic company is
redesigning the controls on its handheld
radios. The company has built several
prototypes and would like to obtain
consumer feedback before proceeding.
Which of the following market research
activities would best meet the company’s
needs
test marketing the prototypes in selected
areas
convening focus groups to critique the
prototypes
conducting direct-mail surveys using
pictures of the prototypes
analyzing consumer-response data to

Compared with other print media
advertising, magazine advertising is
generally characterized by:
A.
high geographic specificity
short lead times
low audience
high pass-along rates
B.
C.
D.

A razor blade manufacturer has decided
to enter the market for pocket
calculators. Which of the following will
most likely be a result of the company’s
decision
A.
a deeper product mix with higher
inventory costs
a wider product mix and high capital
investment requirements
a narrower product mix and less
competition
a shallower product mix and greater
B.
C.
D.

A.
B.
C.
D.
In retail sales situation, it is most
effective for a salesperson to offer to
demonstrate a product:
immediately after attracting the
customer’s attention to the product.
when the customer’s interest appears to
be waning.
as soon as the customer has indicated
an interest in it.
when the customer declines the
salesperson’s offer to be of service.

Which of the following should be the first
consideration of managers seeking to
develop an employee training program
A.
Securing a training facility
Establishing behavioral objectives
Hiring experienced instructors
Identifying training needs
B.
C.
D.

An increase in the price of a particular
product generally results in:
A.
a decrease in producer profit
an increase in consumer demand
a decrease in productions costs
an increase in product supply
B.
C.
D.
Technology
Networking
Hubs
 Routers
 Cables

 Different
cables for different networks
Types of networks
Bus Topology
Star Topology
Ring Topology
Hybrid Networks

Star bus
Hybrid Networks
OSI 7 Layer Model

Open Systems Interconnection








Different layers of the network and what is required of each
Physical (Layer 1)
Data Link
Network
Transport
Session
Presentation
Application (Layer 7)
Found on wikipedia.org
search for OSI 7 Layer Model
Local Area Network (LAN)
Local Area Network (LAN)

Covers local areas
 Home,

office, group of buildings
Uses switched IEEE 802.3 Ethernet
running at 10, 100 or 1,000 Mbit/s or on
Wi-Fi technology
Wide Area Networks (WAN)
Covers broad geographical area
 Connect LANs together so users and
computers in one location can
communicate to users and computers in
another location

Metropolitan Area Network (MAN)
Large computer networks spanning a city
 Use wireless infrastructure or optical fiber
connections

Ethernet
Large and diverse family of frame-based
computer networking technologies for local
area networks (lan)
 Standard IEEE 802.3

 Star
topology, twisted pair wiring
Ethernet Network Interface Card


Supports coaxial
based 10Base2
Supports twisted pairbased 10Based-T
Twisted Pair 10Base-T Cable
BPA Updates
Save the Date

December 4th (Monday)
 Student
Teacher Portfolios
 Sill Hall - Time: 3 – 4:30 pm, Room: 138 or 141

December 13th (Wednesday)
 Student
Teacher Panel: Next BPA meeting
 Sill Hall – Time: 7:30 pm, Room 138