Accounting Ch 1
Managerial accounting differs from financial accounting in that managerial accounting
Emphasizes data relevance over data objectivity
Focused on the past
Financial accounting
Management reviews hourly sales reports to determine the level of staffing needed to service customers
Directing
Management uses information on product costs to determine sales prices
Directing
Even though Kayla's company is adopting International Financial Accounting Standards (IFRS) this year, Kayla (a management accountant) has not completed the required IFRS training
Competence
Tara, an accountant for a smartphone manufacturer, told her friends about a new model of smartphone being released by the company in the following quarter. For competitive reasons, the company keeps its models shrouded in secrecy until the release date
Confidentiality
Management conducts variance analysis by comparing budget to actual
Controlling
To lower product costs, management moves production to Mexico
Controlling & Directing
Daniel provides an analysis of the profitability of a company- owned store that is managed by Daniel's best friend, Stuart. Daniel neglects to include allocated fixed costs in Stuart's report. If Daniel includes those allocated fixed costs, the store will show a loss and Stuart's job could be in danger
Credibility
Which of the following professional standards requires management accountants to communicate information fairly and objectively?
Credibility
Governed by Generally Accepted Accounting Principles (GAAP) or International Financial Reporting Standards (IFRS)
Financial accounting
Information is verified by external auditors
Financial accounting
Main characteristic of data is that it must be reliable and objective
Financial accounting
Primary users are external
Financial accounting
Reporting is based mainly on the company as a whole
Financial accounting
Reports are usually prepared quarterly and annually
Financial accounting
Which of the following organizations is the professional association for management accountants?
IMA
David, a purchasing agent for his company, received two tickets from a supplier to the upcoming Ohio State vs. University of Michigan football game. These tickets sell for over $500 each
Integrity
The CFO directed that certain expenses be reclassified as assets, so that target profit could be achieved. The CFO rationalized that jobs would be saved by reaching the targeted income figures
Integrity
Which of the following professional standards requires management accountants to mitigate conflicts of interest?
Integrity
Focused on the future
Managerial accounting
Main characteristic of data is that it must be relevant
Managerial accounting
Not governed by legal requirements
Managerial accounting
Primary users are internal
Managerial accounting
Reports are prepared as needed
Managerial accounting
Reports tend to be prepared for the parts of the organization rather than the whole organization
Managerial accounting
Of the following skill, which are needed by today's management accountants?
Oral and written communication skills Knowledge of how a business functions Knowledge of both financial and managerial accounting
Management decides to increase sales growth by 10% next year
Planning
Which of the following management responsibilities often involves the use of budgets?
Planning
