ACCT 3309-MA Chapter 1-Practice Questions

The introduction of a new management accounting system is MOST likely to motivate UNWANTED employee behavior when it is used for:

A) evaluation.

The act of simply measuring and reporting information on certain processes:

A) focuses the attention of employees on those processes that are being measured.

Management accounting:

A) is both retrospective, providing feedback about past operations, and also prospective, incorporating forecasts and estimates about future events.

Historically, service companies have:

A) operated in less competitive environments than manufacturing companies.

Which of the following would be MOST helpful for a top manager of a company?

A) profitability report of the company

Financial accounting information:

A) provides a signal that something is wrong.

The regulatory authority responsible for formulating rules of United States GAAP is:

A) the Financial Accounting Standards Board

Which of the following best represents the Act step in the Plan-Do-Check-Act (PDCA) cycle?

B) Measure and monitor ongoing performance and take short-term actions based on the measured performance.

Management accountants are MOST likely to feel outside pressure to influence the numbers favorably when the information is used for:

B) compensation and promotions.

Planning activities include all of the following EXCEPT:

B) evaluating the quality of the service provided.

Which of the following is NOT a function of a management accounting system?

B) financial reporting

Management accounting information is BEST described as:

B) identifying and helping to explain what is wrong.

Management accounting can play a critical role in the service industry because of all the following reasons EXCEPT:

B) many employees have very little contact with customers.

A national company manufactures a line of modern furniture. Information MOST useful to the top executive includes:

B) monthly financial reports on the company's profitability by product line.

Fostering a culture of high ethical standards includes all of the following EXCEPT:

C) following the general examples set by front-line employees.

Financial accounting:

C) is primarily oriented to external stakeholders, such as investors, creditors, regulators and tax authorities.

Managers of service departments need all of the following information EXCEPT:

C) profitability data of the whole company.

In general, it was not until the 1970s that management accounting systems:

C) started to develop innovations in costing and performance-measurement systems due to intense pressure from overseas competitors.

The most important factor in successful organizations is:

C) strategy.

A quarterly report disclosing declining market share information is MOST useful to:

C) the chief executive officer.

A weekly report comparing machine time used to available machine time is information LEAST useful to:

C) the chief executive officer.

The first modern industry to develop and use large quantities of financial statistics to assess and monitor organizational performance was:

C) the railroads.

How the customer is treated at the time of the purchase is an example of the __________ element of the value proposition.

D) service

What is the return on investment for the Chemical Division?

A) 1.25%

A key element of any organization's strategy is identifying:

B) its target customers.

1) Management accounting is subject to the rules formulated by standard setters such as the Financial Accounting Standards Board (FASB).

FALSE

2) Management accounting information is primarily oriented to external stakeholders, such as investors, creditors, regulators, and tax authorities.

FALSE

3) The International Accounting Standards Board sets the guidelines used for management accounting.

FALSE

9) Information about customer satisfaction is an example of financial information.

FALSE

4) A good management accounting system can become a source of competitive advantage for a company.

TRUE

5) Management accounting information is sometimes predictive and forward looking.

TRUE

6) Management accounting has no prescribed rules about its content, how the content is to be developed, and how the content is to be presented.

TRUE

7) The Federal Accounting Standards Advisory Board sets cost accounting standards for all federal government activities.

TRUE

8) Management accounting measures can provide advance warnings of problems.

TRUE

Which division is more profitable based on ROI?

C) Industrial

Which of the following companies is a service company?

C) Orkin Pest Control

When a change is introduced, employees tend to:

D) resist the change.

The person MOST likely to use ONLY financial accounting information is a:

C) current shareholder.

The person MOST likely to use management accounting information is a(n):

D) assembly department supervisor.

A national company manufactures a line of modern furniture. Information MOST useful to the employee who assembles the furniture includes:

A) a daily report comparing the actual time it took to assemble a piece of furniture to the standard time allowed.

A daily report on the number of quality units assembled by each employee is information MOST useful to:

A) a front-line assembly worker.

For improving operational efficiencies and customer satisfaction, nonfinancial information is:

A) critical.

Which of the following best represents the Plan step in the Plan-Do-Check-Act (PDCA) cycle?

C) Define the organization's purpose and select the focus and scope of its strategy. .

Which of the following best represents the Check step in the Plan-Do-Check-Act (PDCA) cycle?

C) Define the organization's purpose and select the focus and scope of its strategy.

Which statement below is FALSE?

C) Employees spend more attention on those variables that are not getting measured.

What is the Return on Sales for the Retail paint division?

C) 20%

Management accounting information can be used for all of the following EXCEPT:

D) evaluate the market price of the stock.

A law firm would use management accounting information for all of the following decisions EXCEPT:

D) location of annual holiday party.

Management accounting information includes all of the following EXCEPT:

D) market price of the stock.

Management accounting reports might include information about:

D) All of the above are correct.

The Hawthorne study revealed that

D) All of the above are correct.

Which of the following types of information are used in management accounting?

D) All of the above are correct.

Nonfinancial information might be used for all of the following EXCEPT:

D) All of the above are used.

Which of the following would be considered management accounting information?

D) Both budgeted production for the year of 2011, and the budgeted balance sheet.

_______ helped develop the Plan-Do-Check-Act (PDCA) cycle.

D) Ford

Which of the following best represents the Do step in the Plan-Do-Check-Act (PDCA) cycle?.

D) Implement the chosen course of action.

13) Which of the following descriptors refer to management accounting information?

D) It is oriented to meeting the decision making needs of employees and managers inside the organization.

21) Historically, management accounting innovations have been developed by:

D) Managers.

The Institute of Management Accountants (IMA):

D) a professional organization of management accountants that issues standards for management accounting.