Quizzer-Management-Accounting for cost accounting very easy PDF

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MANAGEMENT ACCOUNTING Quizzer – Management Accounting (Basic Concepts)

TRUE OR FALSE 1.

Accounting is an information system that provides essential data about the economic activities of an entity to various users to aid them in making informed judgments and decisions. T

2.

Managerial accounting reports are prepared according to generally accepted accounting principles. F

3.

Managerial accounting information includes both historical and estimated data. T

4.

Since there are few rules to restrict how an organization chooses to arrange its own internal data for decision making, managerial accounting provides ample opportunity for creativity and change. T

5.

A diagram of the operating structure of an organization is called an organization chart. T

6.

In most business organizations, the chief accountant is called the treasurer. F

7.

In most business organizations, the chief accountant is called the controller. T

8.

A staff department or unit is one that provides services, assistance, and advice to the departments with line or other staff responsibilities. T

9.

The vice presidents of production and sales and the controller hold line positions in most large organizations. F

10. A staff department has no direct authority over a line department. T 11. The controller's staff consists of management accountants responsible for systems and procedures, general accounting, budgets, taxes, and cost accounting. T 12. Managerial accounting reports must be useful to the user of the information. T 13. Planning is the process of directing operations to achieve the organization’s goals and plans. F 14. Planning is the process of setting goals for the use of an organization’s resources and of developing ways to achieve these goals. T 15. Control is the process of directing operations to achieve the organization’s goals and plans. T 16. Managerial accounting provides useful information to managers on product costs. T 17. Managerial accountants more and more are considered "business partners." T 18. Managerial accountants often are part of cross-functional teams. T 19. An increasing number of organizations are segregating managerial accountants in separate managerialaccounting departments. F 20. The role of managerial accountants has changed considerably over the past decade. T 21. Management accounting focuses on financial statements and other financial reports. F 22. The primary objective of management accounting is to provide management with information useful for planning and control of operations. T 23. Both financial and management accounting rely on the same accounting information system. T 24. Managerial accounting is concerned with external decision makers. F 25. Management accounting is synonymous to managerial accounting. T

26. Management accounting has no externally imposed standards while financial accounting has to follow the GAAP. T 27. Financial accounting deals with information that is primarily reported to individuals outside the organization. T 28. Cost accounting refers to accounting for the annual costs of operating a business. F 29. Financial accounting is a subset of cost accounting. F 30. Management accounting is a subset of cost accounting. F 31. Cost accounting is a subset of both management and financial accounting. T 32. Management accounting is a subset of both cost and financial accounting. F 33. The controller performs primarily a line function. F 34. The treasurer performs primarily a line function. T 35. The primary functions of a controller are basically the same as those of a treasurer. F 36. The controller, as the title implies, exercises direct control over business operations. F MULTIPLE-CHOICE 1.

That kind of accounting concerned with providing information to management in making decisions about the operations of the business a. Responsibility accounting c. Management accounting b. Cost accounting d. Financial accounting

2.Managerial accounting: a. is unregulated. b. produces information that is useful only for manufacturing organizations. c. is regulated by the Securities and Exchange Commission (SEC). d. generally focuses on reporting information about the enterprise in its entirety rather than by subunits. 3.

Management accounting a. Is governed by generally accepted accounting principles. b. Draws from disciplines other than accounting. c. Is geared primarily to the past rather than the future. d. Places more emphasis on precision of data compared with financial accounting which does not.

4.

A type of managerial accounting which refers to the determination of the operating cost regardless of cost behavior is a. Differential accounting c. Responsibility accounting b. Full cost accounting d. Profitability accounting

5.

Which of the following characteristics does not relate to management accounting? a. Accounting reports may include non-monetary information b. It is subject to restrictions imposed by Generally Accepted Accounting Principles (GAAP). c. Reports are often based on estimates and are seldom useful for anything other than the purpose for which they are prepared. d. It provides data for internal users within the business organization.

6.

Management accounting is an integral part of the management process. As such, it provides essential information for the following objectives except a. Maintaining the current level of resource utilization as well as internal and external communication. b. Measuring and evaluating performance. c. Planning strategies and controlling current activities of the organization. d. Enhancing objectivity in decision-making.

7.

In financial accounting, certain rules and regulations must be followed on how financial statements must be presented to the reader. In managerial accounting, no such restrictions generally apply because it is: a. An entirely different field that need not observe the broad guidelines in financial accounting. b. Designed to provide management with non-financial information for decision-making. c. Designed to provide accounting and other financial data to assist management in making business decisions. d. A discipline that does not require preparation of other financial statements.

8.

Which of the following characteristics relate to Financial Accounting? a. Reports are promptly prepared and submitted to preserve its usefulness. b. Data may be both historical and estimates. c. It must adhere to the generally accepted accounting principles. d. It provides information needed by management in making decisions.

9.

The following characteristics refer to Financial Accounting except c. Has no externally imposed standards a. Provides information to external users b. Emphasizes on objective data d. Generates general purpose financial statements

10.

To distinguish between management accounting and financial accounting, the following statements are correct, except a. Management accounting, in view of its various integrated recipients should have a separate data recording and retrieval system from financial accounting. b. Financial accounting is bound by GAAP, and management accounting need not be in conformity with GAAP. c. Financial accounting can be regarded as the process while management accounting can be regarded as the product of the process. d. Management accounting output must be released on time so as not to erode its usefulness; Financial accounting output can still be useful even when delayed.

11.

The primary purpose of management accounting is to provide information a. To external users c. To both internal and external users b. To internal users d. To management and government

12.

Which of these information characteristics is deemed most important to management accounting? c. Relevance, flexibility and timeliness a. Verifiability and accuracy b. Comparability and full disclosure d. Conservatism and substance over form

13.

Managerial accounting a. Is governed by Generally Accepted Accounting Principles b. Is concerned only with monetary information c. Is discretionary rather than mandatory d. Is focused on business as a whole rather than on segments of the business

14.

Managerial accounting is similar to financial accounting in that a. Both are governed by GAAP c. Both concentrate with historical costs d. Both deal with economic events b. Both classify information in the same way

15.

Which of the following is false? a. Management accounting is synonymous to managerial accounting b. Management accounting has no externally imposed standards while financial accounting has to follow the GAAP c. Financial accounting deals with information that is primarily reported to individuals outside the organization d. Cost accounting refers to accounting for the annual costs of operating a business.

16.

Management accountants would not a. assist in budget planning. b. prepare reports primarily for external users. c. determine cost behavior. d. be concerned with the impact of cost and volume on profits.

17.

Which of the following statements is true? a. Financial accounting is a subset of cost accounting b. Management accounting is a subset of cost accounting c. Cost accounting is a subset of both management and financial accounting d. Management accounting is a subset of both cost and financial accounting

18.

Cost accounting system is usually utilized for a. Internal and external reporting that may be used in making non-routine decisions and in developing plans and policies b. External reporting to government, various outside parties and shareholders 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 routine operations

19.Which of the following would likely be considered an internal user of accounting information rather than an external user? d. Middle-level managers a. Stockholders b. Consumer groups c. Lenders 20.All of the following entities would have a need for managerial accounting information except: a. Dell Computer b. The Los Angeles Dodgers baseball club c. The Federal Bureau of Investigation (FBI) d. None of the above responses is correct, as all of these entities would use managerial accounting information 21.

The controller primarily a. Occupies a line position b. Occupies a staff position

c. Occupies a non-supervisory rank-and-file position d. Has no or very little influence in the decision-making process

22.

Which of the following statements is true? a. The controller performs primarily a line function b. The treasurer performs primarily a line function c. The primary functions of a controller are basically the same as those of a treasurer d. The controller, as the title implies, exercises direct control over business operations

23.

The treasurer is usually not concerned with a. Financial reporting b. Short-term financing

c. Cash custody and banking d. Credit extension and collection of bad debts

24.Which of the following employees at Starbucks would likely be considered as holding a staff position? a. The company's chief operating officer (COO) b. The company's lead, in-house attorney c. The company's chief financial officer (CFO) d. Both the company's lead, in-house attorney and the chief financial officer 25.

26.

The professional certification most relevant for managerial accountants is the a. CPA b. CIA c. CMA

d. CFA

Which type of authority do management accountants generally exercise? a. Functional b. Company c. Line

d. Staff

27.

Which of the following is not a characteristic of a “Staff” authority? a. It gives support, advice, and service to line managers. b. It is exercised laterally or upward. c. It has the authority to command action or give orders to subordinates. d. None of the above

28.

Which of the following is a Controller’s responsibility? a. Tax planning and accounting c. In charge of credit and collection b. Custodian of funds d. Arranging short-term financing

29.

You were newly appointed as controller of CZX Corporation. Among the jobs your department would do include the following: a. Cash receipts, cash disbursements, general accounting, taxation, financial accounting analysis, and internal auditing. b. Financial reporting, strategic planning, managerial accounting, taxation, financial statement analysis, and internal accounting. c. Financial accounting, managerial accounting, cost accounting, inventory accounting, payroll accounting, tax accounting and sales forecasting. d. Tax accounting, managerial accounting, internal auditing, and general accounting.

30.

Controllership has attained special recognition in corporate management as business expands in complexity and reach, and as the controller exerts influence for management to take organization’s goals. Controllership and treasurership constitute corporate finance. These are among the controller’s traditional functions:

1. Tax management 2. Financial reporting and interpretation 3. Credit management 4. Sourcing and investing of funds 5. Reporting to government regulatory agencies 6. Risk management 7. Economic appraisal 8. Planning for control a. All eight items b. Items 1, 2, 5, 7, and 8 only c. Items 1, 2, 3, 4, 5, 7, and 8 only d. 2, 3, 5, and 7, and 8 only 31. The chief management accountant called “controller” traditionally performs these functions except: a. The establishment and implementation of the financial planning process. b. Financial and management reporting and interpretation. c. Protection of company resources and economic evaluation. d. Preparation of proposals for product promotions. 32. As business increase in complexity, the function of controllership has attained top level recognition in the corporate area. Many areas related to finance and accounting have been identified with controllership. One area that becomes controversial when included under the controller and viewed that such inclusion violates basic internal control is a. Credit and collection c. Long-range financial planning b. Internal auditing d. Taxation and reporting to government agencies 33. Which of the following is not usually a controller’s function? a. Planning for control b. Protection of assets c. Tax administration

d. Credit and collection

34. Which of the following is not a Controller’s function? a. In charge of planning and control b. Protection of assets such as adequate insurance coverage, etc. c. Interpreting and reporting on effects of external factors on the business d. Arranging short-term financing 35. Controllers are generally not concerned with a. Reporting to government b. Preparation of tax returns

c. Protection of assets d. Investor relations

36. 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 37. 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 needs d. Cost of the reports 38. Which of the following is most associated with managerial accounting? a. Must follow GAAP c. Is prepared for users outside the organization. b. May rely on estimates and forecasts d. Always reports on the entire entity 39. Which of the following is most associated with financial accounting? a. Can have both objective and subjective information. b. Can be prepared periodically, or as needed. c. Prepared in accordance with GAAP d. Can be prepared for the entity or segment.

40. Which of the following statements is false? a. There is no overlap between financial and managerial accounting. b. Managerial accounting sometimes relies on past information. c. Managerial accounting does not need to conform to GAAP d. Financial accounting must conform to GAAP. 41. In most business organizations, the chief management accountant is called the: a. chief accounting officer b. controller c. chairman of the board d. chief executive officer 42. All of the following employees hold line positions in Anthea Electric EXCEPT: a. vice president of production c. manager of the Valhalla Plant b. vice president of finance d. vice president of sales 43. The controller's staff often consists of several management accountants. All of the following would most likely be on the controller's staff EXCEPT: a. general accountants c. investments and shareholder relations managers b. budgets and budget analysts d. cost accountants 44. Managerial accounting a. is prepared according to GAAP. b. is prepared according to management needs.

c. is prepared periodically only. d. is related to the entire business entity only.

45. Who are the individuals charged with the responsibility for directing the day-to-day operations of a business? b. Managers a. Investors c. Employees d. Customers 46. Which of the following are the basic functions of management? a. Supervising and directing c. Organizing and directing d. Planning and controlling b. Decision making and supervising 47. What term is used to describe the process of directing operations to achieve the organization’s goals and plans? a. Supervising c. Directing d. Planning b. Control 48. What term is used to describe the process of developing the organization’s objectives and goals? a. Supervising c. Improving d. Decision making b. Planning 49. Which of the following is the principle reason for preparing managerial accounting reports? a. Usefulness to management c. Clarity b. Cost of preparation d. GAAP 50. Which of the following is not a characteristic of useful managerial accounting reports? a. Accuracy c. historical and estimated data b. GAAP d. reports prepared as needed...