Accounting for Managerial Decisions

Introduction to
Accounting Quiz

Balkrishna Parab
ACMA, FCS, PhD

1. Accounting is a system of analysing, recording, summarising, and ... financial transactions

and reporting the results.
a. Verifying
Authenticating
b. Substantiating
c. Endorsing

Answer: A

2. Financial accounting is oriented towards providing information to ….

a. Internal users
b. Managers
c. External users
d. Board of Directors

Answer: C

3. Cost accounting is oriented towards providing information for the purposes of control and
guidance of …
a. Shareholders
b. Internal Managers
c. Government
d. Regulators

Answer: B

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4. Cost accounting is oriented towards providing information to …
a. External users
b. Lenders
c. Media
d. Internal users

Answer: D

5. Management accounting is oriented towards providing information to …

a. Managers
b. Shareholders
c. Lenders
d. Media

Answer: A

6. Government accounting a branch of accounting system that involves analysing, recording,

summarising, and verifying financial transactions entered by the government and reporting
the results to the … and the public at large.
a. Legislature
b. Judiciary
c. Executive
d. Prime Minister

Answer: A

7. Owners, or shareholders, while using accounting information focus on:

a. Loan Repayment capacity
b. Overall profitability of the company
c. Operational efficiency
d. Regulatory compliance

Answer: B

8. Managers within the company use accounting information for:

a. Evaluating stock market performance
b. Determining debt capacity
c. Making operational decisions
d. Confirming compliance with regulations

Answer: C

9. Lenders use accounting information for:

a. Making operational decisions
b. Evaluating stock market performance
c. Confirming compliance with regulations
d. Determining debt capacity

Answer: D

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10. Regulators use accounting information for:
a. Confirming compliance with regulations
b. Determining debt capacity
c. Making operational decisions
d. Evaluating stock market performance

Answer: A

11. Lenders and credits, while using accounting information focus on … and …
a. Determining debt repayment capacity, long term stability of the company.
b. Return on assets, Funding choices of the company.
c. Return on assets, Determining debt repayment capacity.
d. Stock market performance, confirming compliance with regulations.

Answer: A

12. Managers use accounting information for … and …

a. Formulating plans and policies, Making operational decisions.
b. Determining debt repayment capacity, long term stability of the company.
c. Return on assets, Funding choices of the company.
d. Return on assets, Determining debt repayment capacity.

Answer: A

13. Regulators use accounting information for … and …

a. Checking compliance with laws and regulations, Investigating complaints for fair
trade practices.
b. Determining debt repayment capacity, long term stability of the company.
c. Return on assets, Funding choices of the company.
d. Return on assets, Determining debt repayment capacity.

Answer: A

14. Owners, or shareholders, while using accounting information focus on … and …

a. Return on assets, Determining debt repayment capacity.
b. Return on assets, Funding choices of the company Return on assets, Funding choices
of the company.
c. Stock market performance, Confirming compliance with regulations.
d. Determining operational efficiency, long term stability of the company.

Answer: B

15. What of the following is primarily focussed on the critical examination of financial
statements by an independent chartered accounting to express an opinion regarding the
fairness of the contents of the financial Statements?
a. Auditing
b. Verification
c. Vouching
d. Attestation

Answer: A

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16. Which branch of accounting is primarily concerned with the preparation of specific purpose
financial statements for the management to base financial decisions on?
a. Financial accounting
b. Government accounting
c. Social accounting
d. Cost accounting

Answer: D

17. Which branch of accounting is concerned with analyzing costs of products or services
rendered in a business?
a. Cost accounting
b. Financial accounting
c. Government accounting
d. Social accounting

Answer: A

18. Which branch of accounting deals with the calculate the profit or loss of a business during a
period and to provide an broad picture of the financial position of the business as on a
particular date to investors or
a. Statutory audit
b. Financial Accounting
c. Cost accounting
d. Management accounting

Answer: B

19. Which of the following statements is TRUE?

a. Cost accounting is oriented towards providing accounting information to regulators.
b. Financial accounting is oriented towards external users of accounting information.
c. Management accounting is oriented towards providing accounting information to
shareholders.
d. Government accounting is oriented towards enabling lenders and creditors to
determine the borrowing capacity of the company.

Answer: B

20. Which of the following statements is TRUE?

a. Management accounting reports are detailed.
b. Financial accounting reports are detailed.
c. Financial accounting reports provide information about every department of the
company.
d. Management accounting is highly regulated by the government.

Answer: A

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21. Which of the following statements is TRUE?
a. Financial accounting is future oriented.
b. Financial accounting is unregulated.
c. Management accounting is future oriented.
d. Financial accounting is focussed on influencing behaviour within the organisation.

Answer: C

22. Which of the following branches of accounting is designed to influence the behaviour of
managers and other employees?
a. Management accounting
b. Financial accounting
c. Government Accounting
d. Tax accounting

Answer: A

23. Which of the following branches of accounting primarily reports economic events but also
influences behaviour because manager’s compensation is often based on reported financial
results?
a. Government Accounting
b. Cost accounting
c. Management accounting
d. Financial accounting

Answer: D

24. The reports of which of the following branches of accounting has a combination of financial
and non-financial information?
a. Financial accounting
b. Management accounting
c. Government Accounting
d. Tax accounting

Answer: B

25. Which of the following terms is used to describe the activities managers undertake to use
resources in a way that increases a product’s value to customers and achieves an
organization’s goals?
a. Cost management
b. Financial management
c. Resource management
d. Strategic management

Answer: A

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26. Which of the following accountants work closely with managers in various departments to
formulate strategies by providing information about the sources of competitive advantage?
a. Financial
b. Tax
c. Management
d. External

Answer: A

27. Auditing involves:

a. Assessment of the system of internal controls, Physical verification of assets
b. Analysing financial transaction, reporting results Recording financial transactions,
c. Assessment of the system of internal controls
d. Summarising financial transactions, Physical verification of assets

Answer: A

BALKRISHNA PARAB
teaches law, accounting and finance at the
Jamnalal Bajaj Institute of
Management Studies
University of Mumbai
balkrishnaparab@jbims.edu
Cell: 9833528351

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