Question 1

1.Managerial accounting places less emphasis on precision and more emphasis on relevance than financial accounting.

Accepted Answer

True

Question 2

2.Managerial accounting is not governed by generally accepted accounting principles (GAAP).

Accepted Answer

True

Question 3

3.When carrying out planning activities, managers rely on feedback to ensure that the plan is actually carried out and is appropriately modified as circumstances change.

Accepted Answer

False

Question 4

4.Persons occupying staff positions provide support and assistance to other parts of the organization.

Accepted Answer

True

Question 5

5.The controller\'s position in a retail company is considered a line position rather than a staff position.

Accepted Answer

False

Question 6

6.A strategy is a game plan that enables a company to attract customers by distinguishing itself from competitors.

Accepted Answer

True

Question 7

7.A customer value proposition is essentially a reason for customers to choose a company\'s products over its competitors\' products.

Accepted Answer

True

Question 8

8.Companies that adopt a customer intimacy strategy are in essence saying to their target customers, \"The reason you should choose us is because we understand and respond to your individual needs better than our competitors.\"

Accepted Answer

True

Question 9

9.A value chain consists of the major business functions that add value to the company\'s products and services.

Accepted Answer

True

Question 10

10.Supply chain management involves acquiring and bringing inside the company all of the processes that bring value to customers.

Accepted Answer

False

Question 11

11.Managerial accounting places considerable weight on:   a)generally accepted accounting principles.   b)the financial history of the entity.   c)detailed segment reports about departments, products, and customers.   d)ensuring that all transactions are properly recorded.

Accepted Answer

c)detailed segment reports about departments, products, and customers.

Question 12

12.The plans of management are often expressed formally in:   a)financial statements.  b)performance reports.  c)budgets.  d)ledgers.

Accepted Answer

Budgets

Question 13

13. A _______________ position in an organization is directly related to the achievement of the organization\'s basic objectives.   a) line  b) management  c) staff  d) none of these

Accepted Answer

Line

Question 14

14.Which of the following is NOT one of the three major customer value propositions discussed in the text?   a) customer intimacy  b) discount pricing  c) operational excellence  d) product leadership

Accepted Answer

Discount pricing

Question 15

15.Which of the following is NOT one of the five steps in the lean thinking model discussed in the text?   a) Continuously pursue perfection in the business process.  b) Identify value in specific products/services.  c) Implement an enterprise system.  d) Create a pull system that responds to customer orders.

Accepted Answer

Implement an enterprise system

Question 16

16. All of the following are characteristics of a pull production system EXCEPT:   a) Inventories are reduced to a minimum by purchasing raw materials and producing units only as needed to meet consumer demand.    b) Raw materials are released to production far in advance of being needed to ensure no interruptions in work flows due to shortages of raw materials.    c) Products are completed just in time to be shipped to customers.    d) Manufactured parts are completed just in time to be assembled into products.

Accepted Answer

Raw materials are released to production far in advance of being needed to ensure no interruptions in work flows due to shortages of raw materials.

Question 17

17. The five step framework used to guide Six Sigma improvement efforts includes all of the following EXCEPT:   a) Analyze.  b) Control  c) Digitize.  d) Measure

Accepted Answer

Digitize

Question 18

18. The Institute of Management Accountants\' Standards of Ethical Conduct contains a policy regarding confidentiality that requires that management accountants:   a) acquired in the course of their work except when authorized by management.    b) refrain from disclosing confidential information acquired in the course of their work except when authorized by management.    c) refrain from disclosing confidential information acquired in the course of their work except when authorized by management, unless legally obligated to do so.    d) refrain from disclosing confidential information acquired in the course of their work in all cases since the law requires them to do so.

Accepted Answer

refrain from disclosing confidential information acquired in the course of their work except when authorized by management, unless legally obligated to do so.

Question 19

19. Which of the following is NOT one of the Institute of Management Accountants\' five Standards of Ethical Conduct?   a) Competence  b) Confidentiality  c) Independence  d) Integrity

Accepted Answer

Independence

Question 20

20. Which of the following is not inventory?  a) Raw Material  b) Overhead  c) Finished Good  d) Work-in-process

Accepted Answer

Overhead

Question 21

The sum of all costs of manufacturing costs except direct materials is called manufacturing overhead.

Accepted Answer

False

Question 22

Conversion cost is the sum of direct labor and manufacturing overhead.

Accepted Answer

True

Question 23

Prime cost is the sum of direct labor and manufacturing overhead.

Accepted Answer

False

Question 24

Thread used in the production of mattresses, an indirect material, is classified as manufacturing overhead.

Accepted Answer

True

Question 25

Period costs are also known as inventoriable costs.

Accepted Answer

False

Question 26

All costs in a merchandising company are period costs.

Accepted Answer

False

Question 27

The cost of goods sold of a manufacturing company equals beginning finished goods inventory + cost of goods manufactured ? ending finished goods inventory.

Accepted Answer

True

Question 28

A variable cost is constant if expressed on a per unit basis but the total dollar amount changes as the number of units increases or decreases.

Accepted Answer

True

Question 29

As activity increases within the relevant range, fixed costs remain constant on a per unit basis.

Accepted Answer

False

Question 30

The cost of the cushions that are used to manufacture sofas is best described as a:   a) variable cost.   b) conversion cost.   c) manufacturing overhead cost.   d) period cost.

Accepted Answer

variable cost

Question 31

Manufacturing overhead includes:   a) all direct material, direct labor and administrative costs.   b) all selling and administrative costs.   c) all manufacturing costs except direct labor.   d) all manufacturing costs except direct labor and direct materials.

Accepted Answer

all manufacturing costs except direct labor and direct materials

Question 32

Materials used in the operation of a factory, such as cleaning supplies, that are not an integral part of the final product should be classified as:   a) administrative expense.   b) direct materials.   c) a period cost.   d) manufacturing overhead.

Accepted Answer

manufacturing overhead

Question 33

Direct costs are often difficult to trace to the specific cost object under consideration.

Accepted Answer

False

Question 34

The one cost that would be classified as part of both prime cost and conversion cost would be:   a) direct labor.   b) direct material.   c) indirect material.   d) indirect labor.

Accepted Answer

direct labor

Question 35

Direct costs:   a) can be easily traced to a particular cost object.   b) are incurred due to a specific decision.   c) are the variable costs of producing a product.   d) are incurred to benefit a particular accounting period.

Accepted Answer

can be easily traced to a particular cost object.

Question 36

Which of the following is NOT a period cost?   a) Salary of a billing clerk.     b) Monthly depreciation of the equipment in a fitness room used by factory workers.     c) Insurance on a company showroom, where current and potential customers can view new products.     d) Cost of a seminar concerning tax law updates that was attended by the company\'s controller.

Accepted Answer

Monthly depreciation of the equipment in a fitness room used by factory workers.

Question 37

The annual insurance premium for the factory building would be a:   a) fixed cost, product cost, and direct cost with regard to units of product.     b) fixed cost, product cost, indirect cost with regard to units of product.     c) fixed cost, period cost, and indirect cost with regard to units of product.     d) variable cost, product cost, direct cost with regard to units of product.

Accepted Answer

fixed cost, product cost, indirect cost with regard to units of product.

Question 38

Factory supplies in a manufacturing plant are most likely:   a) sunk costs.   b) variable costs.   c) excluded from product costs.   d) period costs.

Accepted Answer

variable costs

Question 39

All of the following are examples of product costs except:   a) depreciation on the company\'s retail outlets.   b) rental costs of the factory facility.   c) salary of the plant manager.   d) insurance on the factory equipment.

Accepted Answer

depreciation on the company\'s retail outlets.

Question 40

Inventoriable (i.e., product) costs that have become expenses can be found in:    a) administrative expenses.   b) selling expenses.   c) cost of goods sold   d) period costs.

Accepted Answer

cost of goods sold

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