Chapter 1 – Introduction to Managerial Accounting
37. A __________________________ has passed a comprehensive examination designed to ensure technical competence
and has two years of experience.
38. Which of the following is not an objective of managerial accounting?
To prepare external reports for investors, creditors, government agencies, and other outside users.
To provide information for costing of services, products, and other objects of interest to management.
To provide information for planning, controlling, evaluating and continuous improvement.
To provide information for decision making.
Chapter 1 – Introduction to Managerial Accounting
Multiple Choice
ACCT.MOWE.16.1-1 – LO: 1-1
United States – BUSPROG: Analytic
Bloom’s: Comprehension
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
39. Which of the following is an example of the management activity referred to as planning?
Developing a strategy for disposing of hazardous waste.
The decision to eliminate an unprofitable segment of an organization.
The decision to outsource an organization’s payroll processing.
All of these are correct
Multiple Choice
ACCT.MOWE.16.1-1 – LO: 1-1
United States – BUSPROG: Analytic
United States – AK – IMA: Cost Management
Bloom’s: Comprehension
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
40. Developing a company strategy for responding to anticipated new markets is an example of
Chapter 1 – Introduction to Managerial Accounting
planning.
controlling.
decision making.
all of these are correct.
a
Moderate
Multiple Choice
False
ACCT.MOWE.16.1-1 – LO: 1-1
United States – BUSPROG: Analytic
Bloom’s: Knowledge
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
JFND-GO4F-EC4U-KTNN
4OTI-GO4W-NQNBEE
41. Investigating production variances and adjusting the production process is an example of
planning.
controlling.
decision making.
all of these.
Moderate
Multiple Choice
False
ACCT.MOWE.16.1-1 – LO: 1-1
United States – BUSPROG: Analytic
Bloom’s: Knowledge
11/4/2014 8:59 AM
11/4/2014 8:59 AM
42. The primary objective of managerial accounting is
to provide stockholders and potential investors with useful information for decision making.
to provide banks and other creditors with information useful in making credit decisions.
to provide management with information useful for planning and control of operations.
to provide the Internal Revenue Service with information about taxable income.
Multiple Choice
ACCT.MOWE.16.1-2 – LO: 1-2
United States – BUSPROG: Analytic
United States – AK – IMA: Cost Management
Bloom’s: Knowledge
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
43. Managerial accounting
is primarily for external users.
has no mandatory rules.
provides information based on historical information.
must adhere to GAAP.
Multiple Choice
United States – BUSPROG: Analytic
United States – AK – ACBSP: APC-25-Managerial Charact – ACBSP: APC-25-Managerial
Chapter 1 – Introduction to Managerial Accounting
44. Managerial accounting reports are prepared
according to GAAP guidelines.
to meet the needs of decision makers within the firm.
for external users.
all of these are correct
Multiple Choice
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United States – BUSPROG: Analytic
United States – AK – IMA: Cost Management
Bloom’s: Knowledge
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
45. Financial accounting
is concerned with the information about the firm as a whole.
has to adhere to GAAP policies.
focuses on external users.
all of these are correct
United States – AK – IMA: Business Applications
Bloom’s: Knowledge
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
Chapter 1 – Introduction to Managerial Accounting
46. Which of the following would not be an example of a value-added activity?
timely delivery of products
offering the customer a variety of products
storage of finished products
excellent customer service
Multiple Choice
ACCT.MOWE.16.1-3 – LO: 1-3
United States – BUSPROG: Analytic
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Bloom’s: Knowledge
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
47. Total quality management emphasizes
zero defects.
Multiple Choice
ACCT.MOWE.16.1-2 – LO: 1-2
United States – BUSPROG: Analytic
Bloom’s: Knowledge
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
Chapter 1 – Introduction to Managerial Accounting
continuous improvement.
elimination of waste.
all of these are correct.
Multiple Choice
ACCT.MOWE.16.1-3 – LO: 1-3
United States – BUSPROG: Analytic
Bloom’s: Knowledge
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
48. Activity-based costing
strives to create an environment that will enable workers to manufacture zero-defect products.
is the process of choosing among competing alternatives.
was established in response to financial scandals.
encourages process-value analysis.
Multiple Choice
ACCT.MOWE.16.1-3 – LO: 1-3
United States – BUSPROG: Analytic
United States – AK – IMA: Cost Management
Bloom’s: Knowledge
1 min.
11/4/2014 8:59 AM
Chapter 1 – Introduction to Managerial Accounting
49. Which of the following would normally occupy a line position?
staff accountant
accounting manager
vice-president of marketing
treasurer
c
Moderate
Multiple Choice
False
ACCT.MOWE.16.1-4 – LO: 1-4
United States – BUSPROG: Analytic
Bloom’s: Comprehension
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
JFND-GO4F-EC4U-KTB1
50. Which of the following would normally occupy a staff position?
assembly worker
cost accounting manager
factory manager
all of these
Moderate
Multiple Choice
False
ACCT.MOWE.16.1-4 – LO: 1-4
United States – AK – IMA: Cost Management
Chapter 1 – Introduction to Managerial Accounting
51. Which of the following would occupy a line position in a hospital?
manager of the cafeteria
hospital administrator
chief of surgery
none of these
c
Moderate
Multiple Choice
False
ACCT.MOWE.16.1-4 – LO: 1-4
United States – BUSPROG: Analytic
Bloom’s: Comprehension
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
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52. The controller of an organization participates in
planning.
controlling.
decision making.
all of these are correct
Easy
Multiple Choice
False
Bloom’s: Comprehension
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
JFND-GO4F-EC4U-KTBT
Chapter 1 – Introduction to Managerial Accounting
53. The objective of profit maximization
should be the only goal of an organization.
is an objective of financial accounting but not managerial accounting.
should be achieved through legal and ethical means.
should outweigh the goal of product quality.
Multiple Choice
ACCT.MOWE.16.1-5 – LO: 1-5
United States – BUSPROG: Ethics
Bloom’s: Knowledge
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
54. The standards of ethical conduct for managerial accountants include
competence and performance.
integrity and respect for others.
confidentiality, confidence, integrity, and observance.
competence, confidentiality, integrity, and credibility.
ACCT.MOWE.16.1-4 – LO: 1-4
United States – BUSPROG: Analytic
United States – AK – IMA: Cost Management
Bloom’s: Knowledge
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
Chapter 1 – Introduction to Managerial Accounting
Multiple Choice
ACCT.MOWE.16.1-5 – LO: 1-5
United States – BUSPROG: Analytic
United States – AK – IMA: Cost Management
Bloom’s: Knowledge
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
55. Which of the following areas is not emphasized on the CMA examination?
external auditing and business law
economics, finance, and management
decision analysis and information systems
financial accounting and reporting
Multiple Choice
ACCT.MOWE.16.1-6 – LO: 1-6
United States – BUSPROG: Analytic
Bloom’s: Knowledge
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
Chapter 1 – Introduction to Managerial Accounting
56. Accountants that have a Certificate in Public Accounting (CPA):
are the only accountants permitted to serve as external auditors.
must pass a national examination and be licensed by the state in which they practice.
may be held responsible to provide assurance concerning the reliability of a firm’s financial statements.
all of these statements are true.
Multiple Choice
ACCT.MOWE.16.1-6 – LO: 1-6
United States – BUSPROG: Analytic
Bloom’s: Knowledge
1 min.
11/4/2014 8:59 AM
11/4/2014 8:59 AM
57. Persons in the United States who provide assurance service are designated as
Certified Public Accountants.
Certified Financial Accountants.
Chartered Accountants.
Certified Management Accountants.
Multiple Choice
ACCT.MOWE.16.1-6 – LO: 1-6
United States – BUSPROG: Analytic
Bloom’s: Knowledge
1 min.
Chapter 1 – Introduction to Managerial Accounting
58. Describe the major differences between managerial accounting and financial accounting.
Chapter 1 – Introduction to Managerial Accounting
59. Discuss in detail the three uses of managerial accounting information.
60. The Institute of Management Accountants (IMA) established ethical standards for accountants known as the Statement
of Ethical Professional Practice. Briefly describe the four standards.
Chapter 1 – Introduction to Managerial Accounting
61. Briefly describe activity-based costing (ABC), value chain, lean accounting and enterprise risk management (ERM).
Chapter 1 – Introduction to Managerial Accounting
62. List the different types of certifications that can be obtained by an accountant.
Chapter 1 – Introduction to Managerial Accounting
63. Describe the provisions of the Sarbanes-Oxley Act of 2002.
64. You have been working as a staff accountant at Sanborn Industries for three months. Mr. Jones, the accounting
manager as well as your boss, has informed you that he has decided to change vendors for the company’s office supplies.
He notifies you that your company will now be utilizing the store owned by his best friend. Mr. Jones is hopeful that this
will bring in a significant profit for his friend’s business possibly preventing the closing of his store. You receive the first
invoice from that store and realize that the prices are nearly double the amount that the company was paying when using a
large retail chain.
What should you do about the situation?
Chapter 1 – Introduction to Managerial Accounting