Test Answers on Managerial Accounting Flashcards

Source documents identify and describe transactions and events entering the accounting process. evidence and data account is a record of increases and decreases in a specific asset, liability, equity, revenue, or expense item. general ledger is a record containing all accounts used by a company Asset Accounts This type of account. Assets are resources owned […]

Financial Accounting concerned with reporting financial information to external parties (stockholders, creditors, and regulators). Managerial Accounting concerned with providing information to managers for use within the organization. Budget Detailed plan for the future that is usually expressed in formal quantitative terms Performance Report compares budget data to actual data in an effort to identify and […]

State the primary goal of managerial accounting. to provide the information managers need for planning, control, and decision making. If your goal is to be an effective manager, a thorough understanding of managerial accounting is essential. Describe how budgets are used in planning. a profit budget indicates planned income, a cash-flow budget indicates planned cash […]

A(n) _________________ changes basic inputs into products that are sold to customers: A) manufacturing business B) service business C) enterprise business D) merchandising business A Which of the following users is not considered an external user of accounting information: A) a creditor B) an investor C) the government D) a manager D Which of the […]

Which of the following statements is true? Managerial accounting reports are less regulated than financial accounting reports. Managerial accounting focuses on preparing information for internal users. The types and quality of information are dictated by the management of the reporting entity and are not subject to regulatory requirements. Which of the following branches of accounting […]

Managerial accounting applies to all types of businesses, including service, merchandising, and manufacturing, as well as to all forms of business organizations. True. Which of the following statements is not true about managerial accounting? It is highly aggregated. Which of the following statements is true about managerial accounting? It provides more detailed information than financial […]

In order to be useful to managers, management accounting reports should possess all of the following characteristics EXCEPT: be prepared in accordance with generally accepted accounting principles What is the primary criterion for the preparation of managerial accounting reports? b. Meet the manager needs Which of the following is most associated with managerial accounting? May […]

future orientation primary purpose of managerial accounting relevance to business decisions primary focus of managerial accounting AICPA world’s largest association representing the accounting profession audit committee subcommittee of the BOD that is responsible for overseeing both the internal audit function and the annual financial statement audit by independent CPAs BOD body elected by shareholders budget […]

1.1 What Is Managerial Accounting? 1) Define managerial accounting 2) Describe the differences between managerial and financial accounting – who are the primary users of financial accounting information? – who are the primary users of managerial accounting information? 3) List and describe the four functions of management – a large part of a marketing manager’s, […]

Chapter 6 Inventory Goods that are purchased for the purpose of resale to customers All purchases are recorded at cost In most merchandising companies: -Inventory is a relatively liquid asset (sold within a few days or weeks) -Appears near the top of the balance sheet Operating Cycle Series of transactions through which a business generates […]

American Institute of Certified Public Accountants (AICPA) the world’s largest association representing the accounting profession; together with the Chartered Institute of Management Accountants (CIMA) offers the Chartered Global Management Accountant (CGMA) designation. audit committee a subcommittee of the board of directors that is responsible for overseeing both the internal audit function and the annual financial […]

sell products purchased from other businesses to make their objective of maximizing their profits Merchandising businesses Which of the following users is not considered an external user of accounting information? A Manager Which of the following is not accurate when it pertains to managerial accounting? Provides economic data reports on the operations and condition of […]

Managerial Accounting provides financial and nonfinancial information to managers and other internal decision makers Purpose of managerial accounting provide useful information to decision makers Differences between financial accounting and managerial accounting 1. managerial accounting also reports non-financial information. 2. financial accounting information is generally used by external users, whereas managerial accounting information is used by […]

variable costs costs that vary in total in direct proportion to changes in an activity level Example of a cost that varies in total as the number of units change electricity per KWH to operate factory equipment, direct materials cost, wages of assembly worker a cost that has characteristics of both a variable cost and […]

Financial accounting information is reported at fixed intervals in general-purpose financial statements. These financial statements are prepared according to GAAP. Financial accounting information used by external users such as the following: Shareholders Creditors Government agencies The general public Managerial accounting information is designed to meet the specific needs of a company’s management and includes historical […]

Managerial accounting is applicable to service entities, manufacturing entities, and not-for-profit entities. (all of these) For a manufacturing company, which of the following is an example of a period cost rather than a product cost? Wages of salespersons Which one of the following would not be classified as manufacturing overhead? Direct materials Managerial accounting applies […]

In order to be useful to managers, management account reports should possess all of the following characteristics except” be prepared in accordance with generally accepted accounting principles what is the primary criterion for the preparation of managerial accounting reports meet the manager needs which of the following is most associated with managerial accounting may rely […]

Budget A detailed plan for the future that is usually expressed in formal quantitative terms. Business Process A series of steps that are followed in order to carry out some task in a business. Constraint Anything that prevents you from getting more of what you want. Controlling The process of gathering feedback to ensure that […]

What is the objective of managerial accounting? assisting managers in directing and controlling The focus of ____ accounting is to meet the needs of EXTERNAL users Financial What type of organizations use managerial accounting information? Profit seeking, nonprofit enterprises, and manufacturing companies Managerial Accounting Help managers achieve the organization’s goals The balanced scorecard uses both_______ […]

Which of the following are considered to be management’s three broad functions? Planning, directing, and controlling Which of the following is considered part of the controlling process? Keeping the company’s activities on track The management function that requires management to look ahead and establish objectives is planning The process of keeping the company’s activities on […]

Differences between Financial and Managerial Accounting There are seven key differences between financial accounting and managerial accounting: Users: Financial accounting reports are prepared for external parties, whereas managerial accounting reports are prepared for internal users. Emphasis on the future: Financial accounting summarizes past transactions. Managerial accounting has a strong future orientation. Relevance of data: Financial […]