Chapter 1 SB

Select all that apply Which of the following are marketing or selling expenses? Sales salaries Sales commissions Advertising Administrative salaries

Sales salaries Sales commissions Advertising

Which of the following statements is true? Every firm can be identified as one type of organization: manufacturer, merchandiser or service company. Some firms operate as more than one type of organization: manufacturer, merchandiser and/or service company.

Some firms operate as more than one type of organization: manufacturer, merchandiser and/or service company.

Select all that apply Select the correct statements. The number of employees working in manufacturing has remained relatively constant over the past 40 years. Today, about 60% of people employed in America work in nonmanufacturing fields Over 50% of our nation's gross domestic product comes from manufacturing activities. The U.S. economy is moving more towards the service industry

The number of employees working in manufacturing has remained relatively constant over the past 40 years. The U.S. economy is moving more towards the service industry

Managerial accounting information ______. a)is only used in profit making organizations b)is only used in nonprofit organizations is important for both profit making and nonprofit organizations

is important for both profit making and nonprofit organizations

Manufacturing costs can be divided into three categories: direct materials, direct __ and __ __

labor manufacturing overhead

Variable costs ______. remain constant in total and vary per unit vary both in total and per unit remain constant both in total and per unit remain constant per unit and vary in total

remain constant per unit and vary in total

Select all that apply The Sarbanes-Oxley (SOX) Act ______. was primarily aimed at renewing investor confidence is focused on the managerial accounting system puts more responsibility on accountants and less on managers has many implications for managers

was primarily aimed at renewing investor confidence has many implications for managers

Which of the following is NOT a component of the triple bottom line? Profit Planning People Planet

Planning

The Sarbanes-Oxley Act increased the maximum jail sentence for fraudulent reporting to__years.

20

True or false: Monitoring metrics that are important to various areas of operations is part of implementing the plan.

False

Which of the following expenses are associated with running the overall business? General & administrative Manufacturing Marketing & selling

General & administrative

Which of the following is NOT one of the V's of big data? Variety Velocity Volume Validity

Validity

Select all that apply In an attempt to reduce the opportunities for error and fraud, SOX places additional responsibilities on ______. boards of directors external auditors all managers all investors

boards of directors external auditors all managers

A cost is treated as a direct cost when is it ______. a material used in production of the product both possible and reasonable to trace it to a cost object not worth the effort to trace it to a cost object a labor cost

both possible and reasonable to trace it to a cost object

A __ lays out plans in financial terms so that managers can determine the resources needed to achieve their objectives.

budget

Nonmanufacturing costs include ______. insurance on plant equipment assembly-line worker wages company president's salary sales commissions

company president's salary sales commissions

Identifying a problem and taking corrective action is part of the ______ process. implementing control planning

control

Identifying a problem and taking corrective action is part of the ______ process. implementing planning control

control

Managers keep track of how they are doing and determine if adjustments are needed during the __ phase

controlling

Direct labor and manufacturing overhead are referred to as __ costs.

conversion

Direct labor and manufacturing overhead costs are known as ______ costs. prime opportunity period conversion

conversion

In an automobile manufacturing plant, assembly-line workers' wages are __ __ costs.

direct labor

The components of prime costs are ______. direct labor and manufacturing overhead direct materials and direct labor direct materials and manufacturing overhead

direct materials and direct labor

Decisions made during the __ phase are sometimes called operational decisions.

implementation

Costs that differ between decision alternatives are called differential or __ costs

incremental

Materials are treated as __costs when it is not worth the cost or effort to trace them to specific products.

indirect

Salaries of managers and maintenance personnel are examples of ______ labor costs. direct indirect

indirect

Direct materials and direct labor are both ______ costs. period manufacturing nonmanufacturing selling and administrative

manufacturing

Factory costs such as cleaning supplies, taxes, insurance, and janitor wages are classified as ______. manufacturing overhead direct materials indirect labor period costs

manufacturing overhead

Indirect materials and indirect labor are classified as ______. period costs manufacturing overhead nonspecific materials nonspecific labor

manufacturing overhead

Controlling involves ______. putting the company's plan into action measuring actual results preparing annual budgets establishing goals for the company

measuring actual results

A department store is part of the ______ companies category of business. service merchandising manufacturing

merchandising

Wholesalers and retailers are both types of __ companies

merchandising

Nonprofit organizations ______. have no need for any type of accounting information only need financial accounting information must make decisions that use managerial accounting information

must make decisions that use managerial accounting information

There are two broad classifications of costs: manufacturing costs and __ costs

nonmanufacturing / period

Which of the following is NOT one of the three categories of businesses? Merchandising company Manufacturing firm Service company Nonprofit organization

nonprofit organization

Inventoriable costs is another term for __ costs

product

A cost that has already been incurred is called a(n) __cost

sunk

In deciding whether a cost is fixed or variable, think about whether the ______ cost will change. total per unit

total

Select all that apply Which of the following statements are true? A direct cost is sometimes referred to as an opportunity cost. A particular cost is either direct or indirect, regardless of the cost object. A regional sales manager's salary would be a direct cost of the regional office in which the sales manager works. Occupancy costs can be either direct or indirect.

A regional sales manager's salary would be a direct cost of the regional office in which the sales manager works. Occupancy costs can be either direct or indirect.

Which of the following is not an activity that managers perform on a regular, routine basis? Implementing Budgeting Controlling Planning

Budgeting

Select all that apply Which of the following people would be more interested in managerial accounting data than in financial accounting data? Business owners Employees Creditors Investors

Business owners Employees

True or false: Preparing a budget is part of the controlling process.

False

Select all that apply Examples of indirect labor costs include ______. restaurant cooks factory security guards restaurant kitchen managers factory supervisors

factory security guards restaurant kitchen managers factory supervisors

A(n) __ cost does not change in total and a(n) __ cost does not change per unit.

fixed variable

Which of the following statements is true? a)Nonmanufacturing firms are increasing as a proportion of the marketplace. b)Managerial accountants focus much of their efforts on preparing reports of costs incurred to produce physical products. c)The focus of managerial accounting is the same, regardless of type of organization.

A

True or false: Taking actions that carry out the company's plan is a key part of the control process.

False

The standards of conduct for judging right from wrong is referred to as__

ethics

General and administrative expenses include ______. factory maintenance workers' wages and factory supervisors' salaries shipping costs and sales commissions general management salaries and legal department sales commissions and factory supervisors' salaries

general management salaries and legal department

Decisions made during the__phase are sometimes called operational decisions.

implementation

Decisions such as deciding how many employees to hire, salary schedules, and training policies are made during the ______ phase of the management process. controlling implementation planning

implementation

Hiring workers, dealing with suppliers and serving customers are all part of ______. planning controlling implementation

implementation

Costs associated with running a business and selling the product as opposed to making it are called __costs.

period nonmanufacturing

Indirect materials include ______. laptop computer keyboards salt and pepper supervisor salaries factory rent and insurance

salt and pepper

Select all that apply Opportunity costs ______. are out-of-pocket costs should be considered in decision making are uncommon in decision making are the costs of not doing something

should be considered in decision making are the costs of not doing something

Fill in the blanks to complete the sentence. Today most public companies issue corporate __ __of 2 reports that provide sustainability-related information.

social responsibility

What type of cost is irrelevant and should be disregarded when making decisions? Sunk Differential Opportunity

sunk

When applied to business, __ means a company can meet today's needs without sacrificing future generations from meeting their own needs.

sustainability

True or false: A particular cost may be direct or indirect depending on the cost object. True False

true

Select all that apply Decision making ______. is another term for planning uses feedback from other managerial processes requires up-to-date information relies primarily on financial accounting information

uses feedback from other managerial processes requires up-to-date information

Select all that apply Decision making ______. relies primarily on financial accounting information uses feedback from other managerial processes requires up-to-date information is another term for planning

uses feedback from other managerial processes requires up-to-date information

Costs that remain constant on a per unit basis are called __ costs.

variable

The three V's that make data big are __,__,__

volume, velocity, variety

Select all that apply Which of the following statements are true? Classifying a cost a product or period can impact reported profitability. The distinction between product and period costs has more to do with financial accounting than managerial accounting. Inventoriable costs are expensed in the period in which they are incurred. All costs in a merchandising company are considered to be period costs.

Classifying a cost a product or period can impact reported profitability. The distinction between product and period costs has more to do with financial accounting than managerial accounting.

True or false: Virtually all accounting and business problems have clear right or wrong answers. True False

False

True or false: When faced with an ethical dilemma, it is only important to identify those who may be harmed by the decision.

False

Select all that apply Which of the following statements are true? Product costs include all costs involved in making and selling a product. Product costs are always expensed in the same period in which the related products are produced. GAAP requires all manufacturing costs be treated as product costs. Product costs "attach" to units of product as they are purchased for resale or produced.

GAAP requires all manufacturing costs be treated as product costs. Product costs "attach" to units of product as they are purchased for resale or produced.

Which of the following is NOT one of the three common types of analytics? Prescriptive Predictive Descriptive Informative

Informative

Which of the following statements is true? Managers need more detailed information than financial reports can capture. It is important that managerial accounting reports be objective and reliable. Financial accounting reports are prepared as needed. Managerial accounting reports provide information for the company as a whole.

Managers need more detailed information than financial reports can capture.

Select all that apply Which of the following statements are true? Most public companies now issue corporate social responsibility (CSR) reports. The triple bottom line is a component of sustainability accounting. The sole focus of most business strategies is achieving financial results. Most managers today are driven primarily by economic results.

Most public companies now issue corporate social responsibility (CSR) reports. The triple bottom line is a component of sustainability accounting. Most managers today are driven primarily by economic results.

Select all that apply Which of the following are most likely fixed costs? Rent Administrative salaries Property taxes Utilities

Rent Administrative salaries Property taxes

Select all that apply When comparing financial and managerial accounting, which of the following apply to managerial accounting? Information reported for whole company Reports at the decision making level Emphasizes the future Objective and reliable Reports are prepared as needed Mandatory for external reports

Reports at the decision making level Emphasizes the future Reports are prepared as needed

Which of the following statements are true? There are many different ways to categorize costs. When making decisions regarding costs, GAAP rules must be followed. Costs are treated differently in different situations.

There are many different ways to categorize costs. Costs are treated differently in different situations.

The process of discovering and communicating meaningful patterns and insights from data to find more intelligent ways of operating a business is known as__

analytics

Select all that apply Fixed costs ______. become progressively smaller per unit as the level of activity increases remain constant on a per unit basis remain constant in total become progressively larger per unit as the level of activity increases

become progressively smaller per unit as the level of activity increases remain constant in total

Any item a manager wants to know the cost of is called a(n) __ __

cost object

Stiff fines and penalties are imposed by SOX in an effort to ______. encourage whistleblowers to come forward reduce the opportunity for error and fraud counteract the incentive to commit fraud

counteract the incentive to commit fraud

ALL managerial functions involve ______. motivating others long term strategy decision making taking corrective action

decision making

A cost that can be easily traced to a specific cost object is a __cost, whereas costs that cannot be traced or are not worth the effort to trace are __ costs.

direct indirect

Labor costs that can be easily and conveniently traced to specific products are ______ costs. selling manufacturing overhead indirect labor direct labor

direct labor

Intended users of __ of 2 accounting information include investors and regulators; business owners and employees are included in the intended users of __of 2 accounting.

financial managerial

Select all that apply Companies with strong ethical cultures ______. have higher productivity than those without such cultures have higher levels of customer satisfaction have adopted a code of ethics that ensures managers will act ethically do not need to create tip lines to protect whistleblowers

have higher productivity than those without such cultures have higher levels of customer satisfaction

Manufacturing overhead costs include ______. administrative taxes and insurance, sales commissions, and factory assembly workers' wages direct materials, administrative taxes and insurance, and sales commissions direct materials, sales commissions, and factory assembly workers' wages indirect materials, factory supervisors' salaries, and factory depreciation

indirect materials, factory supervisors' salaries, and factory depreciation

__ cost will not influence a decision.

irrelevant

Costs incurred to get the final product to the customer are known as __ or selling expenses.

marketing

The distinction between manufacturing and nonmanufacturing costs applies ______. only to companies that make a physical product only to merchandisers to all companies that make or sell products only to service companies

only to companies that make a physical product

The Sarbanes-Oxley (SOX) Act focuses on three factors that affect the accounting reporting environment: __, __, and __

opportunity incentive character

If cost data will be used for decision making, it is important to consider ______. what costs are under the decision maker's direct control how costs will behave or change whether or not the rules of GAAP are being followed

how costs will behave or change

If cost data will be used for decision making, it is important to consider ______. what costs are under the decision maker's direct control whether or not the rules of GAAP are being followed how costs will behave or change

how costs will behave or change

Select all that apply When faced with an ethical dilemma ______. choose the alternative that is most legal and lawful identify and evaluate the alternative courses of action identify the parties that will be affected by the situation

identify and evaluate the alternative courses of action identify the parties that will be affected by the situation

The Sarbanes Oxley Act ______. is all it takes to create an ethical culture in an organization recommends that all public companies adopt a code of ethics for senior financial officers includes rules that should help employees make ethical decisions imposes penalties for whistleblowers

includes rules that should help employees make ethical decisions

Cost objects ______. can be products, customers, or jobs are only used in financial accounting may only be assigned direct costs

can be products, customers, or jobs

ALL managerial functions involve ______. taking corrective action decision making long term strategy motivating others

decision making

The difference in costs between two alternatives is called a(n) ______ cost. opportunity sunk common differential

differential

Select all that apply A relevant cost ______. is always an opportunity cost pertains to the future differs between alternatives will not influence a decision

pertains to the future differs between alternatives

Determining tactics that management will use to achieve objectives is part of ______. planning controlling implementing

planning

Determining tactics that management will use to achieve objectives is part of ______. planning implementing controlling

planning

Determining the key factors that are important to a company's success is a major component of the __ function.

planning

The first step in__ is to establish goals or objectives and tactics to achieve them

planning

The future-oriented aspect of the management process is ______. planning implementing controlling

planning

The continuous, ongoing cycle of management functions include ______. planning, implementing, and controlling planning, reporting, and controlling planning, recording, and summarizing recording, analysis, and implementation

planning, implementing, and controlling

Direct materials and direct labor together are referred to as __costs.

prime

The difference between __ costs and __ costs determines how and when the cost will be matched up against revenue on the income statement.

product period

Managers must conduct a review of the company's internal control system and issue a report of their effectiveness. This was enacted as part of SOX in an attempt to ______. reduce the opportunity for error and fraud counteract the incentives to commit fraud emphasize the importance of the character of managers and employees

reduce the opportunity for error and fraud