Professional Documents
Culture Documents
2. The process of identifying, measuring, analyzing, interpreting, and communicating information in pursuit of an organization's goals
is called
A. managerial accounting C. management
B. financial accounting D. promotional activities Bobadilla
5. Which of the following is included in the day-to-day work of the management team?
A. decision making C. controlling
B. planning D. all of the above Bobadilla
6. Paying rent, purchasing supplies, and purchasing inventory are which of the day-to-day work activities of the management team?
A. decision making C. directing operational activities
B. planning D. only A and B Bobadilla
7. Which of the following statements is true when comparing managerial accounting to financial accounting?
A. Managerial accounting places more emphasis on precision than financial accounting.
B. Both are highly dependent on timely information.
C. Both rely on the same accounting information system.
D. Managerial accounting is concerned with external decision makers. Bobadilla
8. Which of the following is true of managerial accounting rather than financial accounting?
A. The outputs of this accounting system are the primary financial statements.
B. The methods of this accounting system are established by an overseeing board.
C. The accounting methods are standardized to allow comparisons among companies.
D. The accounting system would be unique to each company. Bobadilla
10. Which of the following statements are true regarding financial and managerial accounting?
I. Both are mandatory.
II. Both rely on the same underlying financial data.
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III. Both emphasize the segments of an organization, rather than just looking at the organization as a whole.
IV. Both are geared to the future, rather than to the past.
A. I, II, III, and IV C. Only II and III
B. Only II, III and IV D. Only II Bobadilla
11. Managerial accounting activity adds value to an organization by pursuing five major objectives, which include
A. providing information for decision making and planning.
B. measuring the performance of activities within an organization.
C. assisting managers in directing and controlling operational activities.
D. all of them Bobadilla
14. For internal uses, managers are more concerned with receiving information that is:
A. completely objective and verifiable.
B. completely accurate and precise.
C. relevant, flexible, and immediately available.
D. relevant, completely accurate, and precise. Bobadilla
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21. The major reporting standard for presenting managerial accounting information is
A. relevance
B. generally accepted accounting principles
C. the cost principle
D. the current tax law Bobadilla
22. With respect to the time dimension, how does managerial decision compare with external performance
evaluation?
Bobadilla A. B. C. D.
Managerial Decision Making Past Past Future Future
External Performance Past Future Past Future
25. Which of the following activities is not usually performed by a management accountant?
A. Assisting managers to interpret data in managerial accounting reports.
B. Designing systems to provide information for internal and external reports.
C. Gathering data from sources other than the accounting system.
D. Deciding the best level of inventory to be maintained. Bobadilla
26. Which of the following statements correctly distinguishes financial and managerial accounting?
A. managerial accounting reports on the whole organization
B. financial accounting is oriented toward the future
C. financial accounting is primarily concerned with providing information for internal users
D. managerial accounting is oriented more toward the planning and control aspects of management Bobadilla
27. How does managerial decision making compare with external performance evaluation?
Managerial Decision Making External Performance Evaluation
A. Detailed Detailed
B. Detailed More aggregated
C. More aggregated Detailed
D. More aggregated More aggregated
Bobadilla
31. How frequent is management accounting report when compared to report to external users?
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32. Managerial accounting differs from financial accounting in that financial accounting is
A. more oriented toward the future.
B. primarily concerned with external financial reporting.
C. concerned with nonquantative information.
D. heavily involved with decision analysis and implementation of decisions. Bobadilla
33. Managerial accounting provides data for all of the following major objectives except:
A. planning and control of costs
B. supporting management planning
C. compliance with SEC reporting requirements
D. determining the costs of products Bobadilla
36. Which of the following does not apply to the content of managerial reports?
A. Reporting standard is relevant to the decision to be made.
B. May extend beyond double-entry accounting system.
C. Pertain to subunits of the entity and may be very detailed.
D. Pertains to the entity as a whole and is highly aggregated. Bobadilla
38. Which of the following statements about internal reports is not true?
A. The content of internal reports may extend beyond the double-entry accounting system.
B. Internal reports may show all amounts at market values.
C. Internal reports may discuss prospective events.
D. Most internal reports are summarized rather than detailed. Bobadilla
39. Management accountants help develop and maintain reporting systems that are aligned with organizational structures and that
provide useful information on an organization’s performance. Management decision processes fall into three categories that
consist of
A. Nonrepetitive, nonprogrammed, and nonstrategic.
B. Repetitive, nonprogrammed, and strategic.
C. Repetitive, programmed, and strategic.
D. Nonrepetitive, nonprogrammed, and strategic. Bobadilla
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43. The role of the managerial accountant in today’s corporate world includes all of the following except:
A. interpreting financial information C. financial modeling
B. financial planning D. bookkeeping Bobadilla
45. Which statement about the extent of detail in a management accounting report is true?
A. It may depend on the frequency of the report.
B. It depends on the type of manager receiving the report.
C. It depends on the level of the manager receiving the report.
D. All of the above. Bobadilla
48. In order to be useful to managers, management accounting reports should possess all of the following characteristics except:
A. Provide objective measures of past operations and subjective estimates about future decisions.
B. Be prepared in accordance with generally accepted accounting principles.
C. Be provided at any time management needs information.
D. Be prepared to report information for any unit of the business to support decision making. Bobadilla
49. The following are inherent to either management accounting or financial accounting:
1. External report
2. Historical information
3. Contribution approach income statement
4. Generally accepted accounting principles
5. Prospective financial statements
Which of the foregoing are related to management accounting and financial accounting, respectively?
Bobadilla A. B. C. D.
Management Accounting 1, 2, 5 3, 5 2, 3 3
Financial Accounting 3, 4 1, 2, 4 1, 4, 5 1, 2, 4, 5
52. Which of the following is an ethical standard of conduct for managerial accountants?
1. competence
2. confidentiality
3. integrity
4. objectivity
A. All of them C. 1, 2, 3 only
B. 1, 3, 4 only D. 1 and 3 only Bobadilla
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53. Under which ethical standard of conduct does the managerial accountant have the responsibility to prepare complete and clear
reports and recommendations after appropriate analyses of relevant and reliable information?
A. competence C. integrity
B. confidentiality D. objectivity Bobadilla
54. Under which ethical standard of conduct does the managerial accountant have the responsibility to communicate information fairly
and objectively?
A. competence C. integrity
B. confidentiality D. objectivity Bobadilla
55. Under which ethical standard of conduct does the managerial accountant have the responsibility to refuse any gift, favor, or
hospitality that would influence or appear to influence his or her decision?
A. competence C. integrity
B. confidentiality D. objectivity Bobadilla
56. Under which ethical standard of conduct does the managerial accountant have the responsibility to refrain from either actively or
passively subverting the attainment of an organization's legitimate and ethical objectives?
A. integrity C. objectivity
B. competence D. confidentiality Bobadilla
57. Under which ethical standard of conduct does the managerial accountant have the responsibility to disclose fully all relevant
information that could reasonably be expected to influence an intended user's understanding of the reports, comments, and
recommendations presented?
A. objectivity C. confidentiality
B. competence D. integrity Bobadilla
58. For managerial decision purposes, the volume of information should be evaluated on the basis of
A. cost-benefit relationship.
B. A cost, but not benefit.
C. A benefit, but not cost.
D. Neither costs nor benefits, but some other criteria. Bobadilla
59. What is the primary criterion for the preparation of managerial accounting reports?
A. Relevance of the reports. C. Timing of the reports.
B. Meet the manager’s needs. D. Cost of the reports. Bobadilla
61. In a broad sense, cost accounting can be defined within the accounting system as
A. internal and external reporting that may be used in making nonroutine decisions and in developing plans and policies.
B. external reporting to government, various outside parties, and stockholders.
C. internal reporting for use in management planning and control, and external reporting to the extent its product-costing
function satisfies external reporting requirements.
D. internal reporting for use in planning and controlling routing operations. Bobadilla
63. If a distinction is made between cost accounting and managerial accounting, managerial accounting is more oriented toward
A. valuation of inventory.
B. analysis of variances including spoilage.
C. financial reporting to third parties.
D. the planning and controlling aspects of the management process. Bobadilla
64. Management accounting and financial accounting differ in that management accounting information
A. is prepared following prescribed rules
B. is prepared using whatever methods the company finds beneficial
C. is prepared for stockholders
D. is prepared following Generally Accepted Accounting Principles Bobadilla
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68. Which of the following is true of managerial accounting rather than financial accounting?
A. The outputs of this accounting system are the primary financial statements
B. The methods of this accounting system are established by an overseeing board.
C. The accounting methods are standardized to allow comparisons among companies
D. The accounting system would be unique to each company Bobadilla
72. In determining whether planned goals are being met, a manager is performing the function of
A. planning C. motivating
B. controlling D. follow-up Bobadilla
76. Which of the following emerging themes in cost accounting deals with managers striving to create and environment which will
enable workers to manufacture perfect (zero defect) products?
A. customer orientation C. total quality management Bobadilla
B. global competition D. advance in information technology
78. Systems implemented to reduce defects in finished products with the goal of achieving zero defects are
A. activity-based costing systems.
B. enterprise resource planning systems.
C. value chain systems.
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79. Which of the following functions is most directly related to management by objective?
A. Reporting C. Control
B. Decision making D. Planning Bobadilla
80. The setting of objectives and the identification of methods to achieve those objectives is called
A. planning C. decision making
B. controlling D. performance evaluation Bobadilla
81. Which of the following best describes what performance evaluation should be designed to do?
A. Modify goal and objectives each month C. Compare actual results to plan
B. Establish sales goals and targets D. Establish blame Bobadilla
82. In the planning and control process, what is the proper sequence of events?
A. Set goals, set objectives, develop plans, implement plans, evaluate performance
B. Establish a master budget, set standard costs, develop variance analysis Bobadilla
C. Develop engineered costs, develop pricing targets, calculate contribution margins
D. Identify variable costs, identify fixed costs, project the sales mix, determine breakeven
89. Developing a company strategy for responding to anticipated new markets is an example of:
A. decision making C. planning
B. controlling D. motivating Bobadilla
91. Strategic cost management includes all of the following tools except:
A. standard cost variance analysis C. activity based management
B. value chain analysis D. all of the above Bobadilla
92. Strategic planning is different from operational planning in that operational planning:
A. involves large sums of money
B. would be involved in determining production levels for next quarter
C. involves only long range goals
D. operational and strategic planning are the same Bobadilla
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93. Which of the following might be a performance measure for the financial perspective of a balanced scorecard?
A. percentage of on-time deliveries by the organization
B. percentage of product defects
C. return on assets
D. percentage of market share held by the organization Bobadilla
94. The initiative to reduce non-value added activity is meeting which balanced scorecard objective?
A. internal operations perspective C. financial perspective Bobadilla
B. customer perspective D. learning and growth perspective
96. Items that prevent the organization from attaining a higher level of achievement within its value chain are called the
A. theory of constraints C. strategic costs management
B. value chain D. cost management systems Bobadilla
97. The overall recognition of the importance of cost relationships among the activities in the value chain and the process of managing
those cost relationships among the activities in the value chain is called
A. the theory of constraints C. activity-based management of activities
B. the value chain D. strategic cost management Bobadilla
98. The set of processes that transform raw materials into finished products is known as a
A. value chain C. lowest cost strategy Bobadilla
B. differentiation strategy D. flexible manufacturing system
99. The period that begins with the arrival of materials and ends with the shipment of a completed goods refers to
A. performance period. C. manufacturing cell.
B. computer-integrated manufacturing. D. cycle time. Bobadilla
100.Conventional and just-in-time manufacturers differ in that the conventional manufacturer is likely to
A. have a longer production cycle than its JIT competitors.
B. need less storage space than its JIT competitors.
C. have a flexible manufacturing system.
D. a high degree of quality control. Bobadilla
101.A form of strategy that a management may adopt in order to attempt in creating a perception of uniqueness that will permit a
higher selling price.
A. Value chain. C. Lead time.
B. Lowest cost. D. Differentiation. Bobadilla
103.The benefits lost or forfeited as a result of selecting one alternative over another are called
A. Differential costs C. Opportunity costs
B. Sunk costs D. Indirect costs Bobadilla
104.Obtaining feedback is generally identified most directly with which of the functions of management?
A. Planning C. Controlling
B. Directing and motivating D. Decision making Bobadilla
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109.The process of comparing, investigating, and evaluating the company’s processes or products against the best level of
performance is known as
A. attestation. C. product review.
B. feedback. D. benchmarking. Bobadilla
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