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