Managerial accounting 6th edition description

Managerial Accounting 6th Edition Description A primary goal of managerial accounting is to provide information to investment managers who analyze a company’s stock for external investors True False Value Chain Analysis concerns the study of value-producing activities, stretching from basic raw materials to the final consumer of a product or service True False An organization’s mission is best described as the basic purpose toward which activities are directed True False One of the companies to first employ a successful cost leadership strategy was Carnegie Steel Company True False Competition among companies normally takes place only on the dimension of price/cost True False The decision to use both fulltime and part time employees during the holiday season is an example of a strategic cost driver True False All costs have at least one primary cost driver True False Most costs are actually incurred as a result of activity cost drivers True False The best criterion for determining if a given action or choice is ethical is to determine if it is legal, because all legal actions are inherently ethical True False Managers who prepare and/or have responsibility for managerial accounting information rarely encounter choices that have questionable ethical dimensions or overtones True False Managerial accounting is primarily focused on: A) Providing creditors information on the status of their loans B) Providing investors with useful information for valuing securities C) Providing the Internal Revenue Service with information to determine the amount of taxes owed D) Providing managers with relevant information to help achieve organizational goals In order to be useful to managers, management accounting reports: A) Should be prepared according to the stated Institute of Management Accounting guidelines B) Should be prepared according to Generally Accepted Accounting Principals C) Should be prepared to meet the specific needs of decision makers D) Should not be prepared prior to the end of a fiscal reporting period Financial accounting information is least useful in providing: A) Aggregate information about an organization’s assets, obligations and performance B) Information for stating corporate wide goals C) Information for internal decision makers D) Periodic reports for shareholders The three analyses that comprise strategic cost management include each of the following except: A) Ratio analysis B) Cost driver analysis C) Strategic position analysis D) Value chain analysis Strategic Position Analysis is best defined as: A) The process of making the organization into a well ordered whole B) Fundamental choices about the size and scope of operations and technologies C) The formulation of a program for a specific goal D) An organization’s basic way of competing to sell products and services A goal is best defined as: A) The mission of an organization B) The implementation of specific ideas C) The fundamental purpose of an organization D) A definable and measurable objective Which of the following is not one of the three strategic positions that Porter views as leading to business success? A) Market niche B) Cost leadership C) All things to all people D) Product or service differentiation Product or service differentiation involves: A) Any changes made to a product or service B) The use of new technologies in manufacturing C) Shifting sales to growing markets D) Creating something that is perceived as unique and worth a premium price The process of selecting strategies to achieve goals is often referred to as: A) Controlling B) Organizing C) Motivating D) Planning The process of making the organization into a well-ordered whole is referred to as: A) Organizing B) Controlling C) Motivating D) Planning The process of ensuring that results agree with plans is referred to as: A) Controlling B) Decision making C) Organizing D) Planning The act of delegating authority for implementing plans to other managers and employees can be viewed as an aspect of: A) Controlling B) Decision making C) Organizing D) Planning To compete on the basis of price, the seller must most carefully manage: A) Service B) Product development C) Cost D) Quality World-class companies must continuously struggle to improve performance in the dimension(s) of: A) Price/cost B) Service C) Quality D) All of the above _ are fundamental choices about the size and scope of operations and about technologies employed in delivering products or services to customers A) Activities B) Management systems C) Organizational strategies D) Structural cost drivers This is an organizational cost driver for a discount department store chain: A) The decision to price lower than a key competitor B) The decision to rearrange merchandise within a store C) The decision to issue a purchase order for raw materials D) The decision to sale product globally versus only domestically A decision to work closely with a limited number of suppliers for the purpose of ensuring that the proper materials are available at the optimal time is an example of: A) A batch level cost driver B) An activity cost driver C) An organizational cost driver D) A structural cost driver _ are specific units of work performed to serve customer needs that consume costly resources A) Activity cost drivers B) Customer cost drivers C) Organizational cost drivers D) Structural cost drivers Examples of activity cost drivers include all of the following except: A) Inspecting incoming raw materials B) Machine time spent working on a product C) Deciding how to arrange raw materials inventory within the warehouse D) Receiving (loading) raw materials into the warehouse Ethical behavior: A) Always involves choosing between actions that are clearly right or wrong B) Is best guided by a policy of placing corporate performance above individual ends C) Is best described as any actions that are permitted by law D) Is not guided by well-defined rules and is often subjective Ethics deals with: A) The propriety of a course of action B) The fitness of a course of action C) The moral quality of a course of action D) All of the above Financial accounting is primarily focused on: A) Providing the Internal Revenue Service with information to determine the amount of taxes owed B) Providing managers with relevant information to help achieve organizational goals C) Providing investors with useful information for valuing securities D) Providing information for internal users Managerial accounting is primarily focused on: A) Providing information for internal and external users B) Providing general purpose financial statements C) Providing special-purpose information and reports D) Following generally accepted accounting principles Which of the following is not a component of strategic cost management? A) Ratio analysis B) Value chain analysis C) Cost driver analysis D) Strategic position analysis Managerial accounting must conform to which of the following standards? A) Generally Accepted Accounting Principles (GAAP) B) International Financial Reporting Standards (IFRS) C) Internal Revenue Service tax code D) None of the above Which of the following phrases is most descriptive of managerial accounting? A) Often used to state corporate goals B) May be subjective C) Typically prepared quarterly or annually D) Keeps records of assets and liabilities Which of the following phrases is most descriptive of financial accounting? A) May measure time or customer satisfaction B) Future oriented C) Subject to cost-benefit analysis D) Highly aggregated statements Which of the following statements best defines the mission of an organization? A) Increase next year’s sales by 10 percent over current year sales B) Become the world’s largest provider of consumer goods C) Adopt cost effective plan for providing new products and services to customers D) Providing high quality products and services to customers Which of the following statements best defines a goal for an organization? A) Increase next year’s sales by 10 percent over current year sales B) Providing high quality products and services to customers C) Adopt a cost effective plan for providing new products and services to customers D) Become the world’s largest provider of consumer goods Which of the following statements best defines a strategy for an organization? A) Increase next year’s sales by 10 percent over current year sales B) Providing high quality products and services to customers C) Adopt a cost effective plan for providing new products and services to customers D) Become the world’s largest provider of consumer goods According to Michael Porter, which of the following is an example of cost leadership as a business strategy? A) A regional beer brewer that caters to local tastes B) A glass manufacturer utilizing research and development to identify new applications for glass and ceramics C) An online bookseller utilizing the Internet to differentiate itself from traditional booksellers D) A manufacturer focused on designing and building corporate jet aircraft According to Michael Porter, which of the following is an example of product or service differentiation as a business strategy? A) A regional beer brewer that caters to local tastes B) An automobile manufacturer that focuses on the rapid introduction of technological change in new automobile design C) An online bookseller utilizing the Internet to differentiate itself from traditional booksellers D) A manufacturer focused on designing and building corporate jet aircraft Which of the following descriptions best describes the process of planning? A) Comparing the budget with actual results B) Delegating authority to employees to address customer complaints C) Preparing a budget for an organization that meets sales goals for the upcoming year D) Assigning managers to different regional centers to facilitate distribution of goods to customers Which of the following descriptions best describes the process of controlling? Delegating responsibility and authority to employees in an organization is an example of: A) Planning B) Organizing C) Controlling D) Motivating Which of the following departments often found in a merchandising organization would be classified as a line department? A) Maintenance B) Human Resources C) Payroll D) Home Furnishings Which of the following employees often found in a manufacturing organization would be classified as part of a line department? A) Production Manager B) Treasurer C) Chief Information Officer (CIO) D) Controller Which of the following performance factors is least relevant for a “worldclass” company to compete globally? A) Price/Cost B) Location C) Service D) Quality To stay competitive in the express delivery business, both Federal Express and United Parcel Service most compete against each other based on which of the following? A) Price/Cost B) Service C) Quality D) All of the above To compete on the basis of price, the seller must carefully manage: A) The degree to which products or services meet customer’s needs B) Timely delivery and customer support C) Communications between buyer and seller D) Operating and maintenance costs To compete on the basis of quality, the seller must carefully manage: A) The degree to which products or services meet customer’s needs B) Timely delivery and customer support C) Communications between buyer and seller D) Operating and maintenance costs To compete on the basis of service, the seller must carefully manage: A) The degree to which products or services meet customer’s needs B) Timely delivery and customer support C) Communications between buyer and seller D) Operating and maintenance costs Which of the following best defines a structural cost driver? Which of the following best defines an organizational cost driver? A) Fundamental choices about the size and scope of operations and technologies employed in delivering products or services to customers B) Choices concerning the organization of activities and the involvement of persons inside and outside the organization in decision making C) Specific units of work performed to serve customer needs that consume costly resources D) The process of ensuring that results agree with plans Which of the following best defines an activity cost driver? A) Fundamental choices about the size and scope of operations and technologies employed in delivering products or services to customers B) Choices concerning the organization of activities and the involvement of persons inside and outside the organization in decision making C) Specific units of work performed to serve customer needs that consume costly resources D) The process of ensuring that results agree with plans Which of the following is an example of an activity cost driver? A) Deciding how to arrange raw materials inventory within a warehouse B) Designing components of a product so they can fit together only in the correct manner C) Determining the best location for a manufacturing facility D) Receiving raw materials into the warehouse E) None of the above Which of the following is an example of an organizational cost driver? A) Deciding how to arrange raw materials inventory within a warehouse B) Inspecting incoming raw materials C) Determining the best location for a manufacturing facility D) Receiving raw materials into the warehouse E) None of the above Which of the following is an example of a structural cost driver? A) Deciding how to arrange raw materials inventory within a warehouse B) Moving items being manufactured between workstations C) Determining the best location for a manufacturing facility D) Placing a purchase order for raw materials E) None of the above All of the following are examples of activity cost drivers except: A) Placing a purchase order for raw materials B) Inspecting incoming raw materials C) Hiring and training a new employee D) Providing employees with cost information and authorizing them to make decisions Which of the following best describes ethics? A) The system of policies, processes, laws, and regulations that affect the way a company is directed and controlled B) The moral quality, fitness, or propriety of a course of action that can injure or benefit people C) What is permitted under the law D) Understanding the difference between right and wrong Which of the following best describes corporate governance? A) The system of policies, processes, laws, and regulations that affect the way a company is directed and controlled B) The moral quality, fitness, or propriety of a course of action that can injure or benefit people C) What is permitted under the law D) Understanding the difference between right and wrong A code of ethics should include which of the following elements? A) Definition B) Purpose C) Enforcement D) All of the above Which of the following can be considered to be unethical behavior? A) Accelerating or decelerating shipments at the end of the quarter to meet current earnings forecasts B) Allocating overhead costs to a product based on labor hours C) Estimating sales in order to prepare the annual budget for the company D) Ordering more raw materials that forecast in anticipation of uncertain demand Which of the following can be considered to be unethical behavior? A) Forecasting raw material requirements for next months production forecast B) Purchasing raw materials from a relative or friend rather than seeking bids C) Inspecting incoming raw materials from a supplier D) Working closely with a limited number of suppliers Which of the following can be considered to be unethical behavior? A) Forecasting the amount of ending inventory on hand at the end of a budgetary period B) Transferring ending inventory to another warehouse in another geographic location C) Keeping inventory that is unlikely to be used so as to avoid recording a loss D) Building up inventory in anticipation of increased sales in the next accounting period Which of the following can be considered to be unethical behavior? A) Assigning direct labor costs to Contract A and Contract B using different rates for different employees B) Assigning different direct material costs to Contract A and Contract B based on usage C) Assigning overhead costs to Contract A based on labor hours and Contract B based on machine hours D) Assigning costs of Contract A to Contract B to avoid an unfavorable performance report on Contract A Codes of ethics are limited to which of the following types of organizations: A) Professional organizations and associations B) For-profit organizations C) Not-for-Profit organizations D) All of the above Corporate social responsibility would include all of the following elements except: A) Providing quality daycare for young dependents of an organization B) Estimating the cost of environmental clean-up upon the ultimate disposal of an asset C) Limiting the return on investment to investors D) Donating employee time for community service From a managerial accounting standpoint, which of the following areas of the Sarbanes-Oxley Act of 2002 (SOX) are most pertinent? A) External Auditing Standards B) Review of internal controls C) Codes of ethics for financial officers D) Penalties for fraud Which of the following phrases is primarily relevant to managerial accounting as opposed to financial accounting? A) Preparing periodic financial statements B) Calculating earnings per share for shareholders C) Helping managers make decisions D) Summarizing information about past events Which of the following phrases is primarily relevant to financial accounting as opposed to managerial accounting? A) Analyzing cost drivers B) Helping managers to make decisions C) Evaluating a company’s strategic position D) Conforming to external standards Ethics deals will all of the following except: A) The fitness of a course of action B) The moral quality of a course of action C) The legal responsibility under law D) The propriety of a course of action Ethical behavior: A) Is guided by well-defined rules of conduct B) Involves choosing between actions that are either right or wrong C) Is best guided by placing corporate performance above individual ends D) Is often subjective and based on the moral quality, fitness, or propriety of a course of action Which of the following would best describe the mission of your new business? A) To provide high quality lawn services and make a profit B) To add five new customers per month C) Identify new lawn services that will attract new customers and increase revenues D) Become the largest provider of lawn services in the city Which of the following would best describe a goal for your new business? A) To provide high quality lawn services and make a profit B) To add five new customers per month C) Identify new lawn services that will attract new customers and increase revenues D) Become the largest provider of lawn services in the city Which of the following would best describe a strategy for your new business? A) To provide high quality lawn services and make a profit B) To add five new customers per month C) Identify new lawn services that will attract new customers and increase revenues D) Become the largest provider of lawn services in the city Which of the following would best describe planning for your new business? A) Assigning workers to perform lawn services for various clients B) Preparing a cash budget to estimate your monthly revenues and expenditures C) Comparing the actual cash balance with the budgeted cash budget each month D) Preparing monthly billing statements for clients Which of the following would best describe organizing for your new business? A) Assigning workers to perform lawn services for various clients B) Preparing a cash budget to estimate your monthly revenues and expenditures C) Comparing the actual cash balance with the budgeted cash budget each month D) Preparing monthly billing statements for clients Which of the following would best describe controlling for your new business? A) Assigning workers to perform lawn services for various clients B) Preparing a cash budget to estimate your monthly revenues and expenditures C) Comparing the actual cash balance with the budgeted cash budget each month D) Preparing monthly billing statements for clients Which of the following best describes an organizational cost driver for your new business? A) Determining the types of lawn services that you will provide for clients B) Providing employees with the authority to make decisions regarding a client C) Preparing monthly billing statements for clients D) Hiring and training new employees ... and/or have responsibility for managerial accounting information rarely encounter choices that have questionable ethical dimensions or overtones True False Managerial accounting is primarily focused... managers, management accounting reports: A) Should be prepared according to the stated Institute of Management Accounting guidelines B) Should be prepared according to Generally Accepted Accounting Principals... Cost driver analysis D) Strategic position analysis Managerial accounting must conform to which of the following standards? A) Generally Accepted Accounting Principles (GAAP) B) International Financial