Test Bank for Managerial Accounting An Introduction to Concepts
Methods and Uses 11th Edition
Which of the following is true of Managerial Accounting?
1. Complies with Securities and Exchange Commission rules and regulations.
2. Uses cost-benefit analysis to determine the amount of detail presented.
3. Prepares general-purpose reports for people outside an organization.
4. Presents summary historical data in compliance with generally accepted accounting
principles.
The best example of using managerial accounting information to help organizations
succeed includes which of the following?
1. implementing strategies.
2. processing travel vouchers.
3. tracking employee time and attendance.
4. reconciling petty cash balances.
Managerial accounting information is used by which of the following managers?
1. marketing managers to help price products and assess their profitability.
2. production managers to manage quality and costs and to assure on-time delivery.
3. general managers to measure employee performance and create incentives.
4. All of the answers are correct.
Considering the time dimension, how does managerial decision making compare with
external performance evaluation? Managerial Decision Making External
Performance
1. Past Past
2. Past Future
3. Future Past
4. Future Future
The question “How much information is enough?” for managerial purposes should be
answered on
1. a cost/benefit basis.
2. a cost, but not benefit, basis.
3. a benefit, but not cost, basis.
4. neither costs nor benefits, but some other criteria.
Accounting data used for managerial reports
1. must be the same data used for reporting to shareholders, but may be different for tax
purposes.
2. must be the same data used for tax purposes, but may be different data for reporting to
shareholders.
3. must be the same data used for both tax purposes and reporting to shareholders.
4. may be different from data used for both tax purposes and reporting to shareholders.
Who manages cost and managerial accounting in most organizations?
1. Controller
2. Treasurer
3. Board of directors
4. Chief executive officer
Who manages cash flows and raises cash for operations in most organizations?
1. Controller
2. Treasurer
3. Board of directors
4. Chief executive officer
Who is the manager in charge of raising cash for operations and managing cash and
near-cash assets?
1. Chief financial officer.
2. Controller.
3. Treasurer.
4. Internal auditor.
Which of the following works in planning, decision making, designing information
systems, designing incentive systems, and helping managers make operating
decisions?
1. Controller
2. Treasurer
3. Board of directors
4. Chief executive officer
Who is the chief accounting officer that oversees providing information to
managers?
1. Chief financial officer.
2. Controller.
3. Treasurer.
4. Internal auditor.
What organization publishes a journal called Strategic Finance, numerous policy
statements, and research studies on accounting issues?
1. Institute of Management Accountants
2. Cost Accounting Standards Board
3. General Accounting Office
4. American Institute of Certified Public Accountants
The Sarbanes-Oxley Act of 2002 has increased the interaction between the audit
committee of the board of directors and the which of the following?
1. controller.
2. treasurer.
3. internal auditor.
4. production manager.
In 2002, Congress passed the Sarbanes-Oxley Act. Which of the following is not a
provision of that act?
1. The law empowered the American Institute of Certified Public Accountants (AICPA) to
oversee licensure of auditors.
2. The Chief Executive Officer (CEO) must sign the company’s financial statements
attesting to the inclusion of all material information.
3. The Public Company Accounting Oversight Board (PCAOB) was created.
4. The CEO and Chief Financial Officer (CFO) must indicate that they are responsible for
the company’s system of internal control.
What organization developed the “Standards of Ethical Conduct for Management
Accountants” mandating that management accountants have a responsibility to
maintain the highest levels of ethical conduct?
1. Institute of Management Accountants
2. Cost Accounting Standards Board
3. General Accounting Office
4. American Institute of Certified Public Accountants
Which of the following accurately describes the managerial accountants’ professional
environment and ethical responsibilities?
1. Stockholders have an ethical responsibility to report accurately even when their own
compensation suffers.
2. Financial analysts have an ethical responsibility to report accurately even when their
own compensation suffers.
3. Managers have an ethical responsibility to report accurately even when their own
compensation suffers.
4. Managers do not have an ethical responsibility to report accurately even when their own
compensation suffers.
How is cost, as used in managerial accounting, distinguished from expense, as used in
financial accounting?
1. A cost is a sacrifice of resources and expenses are recorded in accounting records, but
not all costs appear in accounting records.
2. All expenses are costs, but not all costs are expenses in the period of incurrence, even
though they will become expenses in some later period.
3. Managerial accounting deals primarily with costs, not expenses, while financial
accounting primarily deals with expenses for financial reporting as defined by generally
accepted accounting principles.
