STRAT FINAL EXAM REVIEWER

Computer-integrated manufacturing (CIM) plants allow management to do all EXCEPT A. Create brand recognition. B. diagnose the reason for a defect. C. Access timely and accurate information reading production costs. d. respond faster to changes in customer preferences.

A. Create brand recognition.

Which of the following four general steps to improve the effectiveness and efficiency of an organization's activities would be performed first? A. Identify what is now being done B. Measure current performance C. Analysis D. Improve

A. Identify what is now being done

A key advantage of cross-functional teams in today's manufacturing and service environments is A. Information is shared much more quickly by people in different functions and this helps speed products to market. B. The physical size of the organization gets smaller. C. There are fewer computing system requirements. D. The number of senior managers decreases.

A. Information is shared much more quickly by people in different functions and this helps speed products to market.

Which of the following activities is value-added? A. Processing B. moving C. storing D. Inspecting

A. Processing

It is the generation of, and experimentation with, ideas related to new products, services, or processes. A. Research and development B. Design of products, services, or processes C. Production D. Marketing

A. Research and development

There are four broad classes of activities in the value chain, Research and development would be in which class? A. activities relating to getting ready to make the product B. activities related to making the product C. activities related to dealing with the customer D. other activities that support the first three activities

A. activities relating to getting ready to make the product

R&D, production and customer service are business functions that are all included as part of A. the value chain B. benchmarking C. marketing D. the supply chain

A. the value chain

is an operational factor that directly affects the economic viability of the organization, A.Customer focus B. A key success factor C. Continuous improvement D. Supply chain

B. A key success factor

There are four broad classes of activities in the value chain. Storing work in process would be in which class? A. Activities relating to getting ready to make the product B. Activities related to making the product C. Activities related to dealing with the customer D. Other activities that support the first three activities

B. Activities related to making the product

Which of the following statements is true? A. The customer will choose the product with the lower price. B. If two products provide the same services and quality, the customer will choose the product with the lower price. C. If two products provide the same services and quality, the customer will choose the product with the higher price. D. The customer will choose the product with the higher price.

B. If two products provide the same services and quality, the customer will choose the product with the lower price.

Employees improve effectiveness and efficiency by performing four general steps regarding the organization's activities. The following describes which step? The employee measures the performance of each activity in the process (value chain) from the perspective of customer requirements while assuring that the overall performance of activities meets the requirements of the organization's other stakeholders. A. Identify what is now being done. B. Measure current performance. C. Analyze. D. Improve.

B. Measure current performance.

The sequence of activities that creates a good or service is: A. an organization B. a value chain C. a customer chain D. an Information system

B. a value chain

Well-implemented just-in-time production and purchasing techniques A. Result in large stockpiles of inventory to keep production running. B. strengthen a company' ability to compete in the marketplace. C. Increase a reliance on long-term consumer forecasts. D. reduce a company's competitive edge.

B. strengthen a company' ability to compete in the marketplace.

Is the acquisition, coordination, and assembly of resources to produce a product or deliver a service. A. Research and development B.Customer services C. Production D. Marketing

C. Production

Which of the following would NOT happen when quality is bad? A. Rework B. Scrap C. Zero-defects D. An increase in the cost of good units increases

C. Zero-defects

There are four broad classes of activities in the value chain. Billing activities would be in which class? A. activities relating to getting ready to make the product B. activities related to making the product C. activities related to dealing with the customer D. other activities that support the first three activities

C. activities related to dealing with the customer

__________ is/are when a firm compares itself with the be other comparable organizations. A. Value chain B. Supply chain C. Key success factors D. Benchmarking

D. Benchmarking

Customers are demanding improved performance related to A.Reduced costs. B.Both reduced costs and increased quality. C. Lower costs, improved quality, and improved customer service. D. Lower costs, improved quality, improved customer service, and innovative products and services.

D. Lower costs, improved quality, improved customer service, and innovative products and services.

There are four broad classes of activities in the value chain. Accounting activities would be in which class? A. Activities relating to getting ready to make the product B. Activities related to making the product C. Activities related to dealing with the customer D. Other activities that support the first three activities

D. Other activities that support the first three activities

The value chain is the sequence of business functions in which A. Value is deducted from the products or services of an organization B. Value is proportionately added to the products or services of an organization. C. Products and services are evaluated with respect to their value to the supply chain. D. Usefulness is added to the products or services of an organization.

D. Usefulness is added to the products or services of an organization.

___________ is the quantification of business transactions or other economic events that have occurred or forecasts of those that may occur. a. Accumulation b. External reporting c. Measurement d. Internal reporting

a. Accumulation

___________ is a determination of the reasons for the reported activity and its relationship with other economic events and circumstances. a. Analysis b. Measurement c. Evaluation d. Accumulation

a. Analysis

Accounting and other reports that help managers monitor performance and focus on problems and/or opportunities that might otherwise go unnoticed a. Feedback b. Performance report c. Financial accounting d. Managerial accounting

a. Feedback

____________ is the recognition and evaluation of business transactions and other economic events for appropriate accounting action. a. Identification b. Analysis c. Communication d. Evaluating

a. Identification

An activity that consumes resources or takes time out that does not add value for which customers are willing to pay a. Non-value added activity b. Value-added activity c. Process reengineering d. Total quality management

a. Non-value added activity

Which of the following groups would be LEAST likely to receive detailed management accounting reports? a. Stockholders b. Sales representatives c. Production supervisors d. Managers

a. Stockholders

The elements of an ethical control system include the following EXCEPT a. a reward system for turning in those who violate the ethical code. b. a statement of the organization's values and code of ethics. c. an ongoing internal audit of the ethical control system. d. a statement of the employee's ethical responsibilities.

a. a reward system for turning in those who violate the ethical code.

The competitive strategy in which the firm succeeds by developing and maintaining a unique value for the product, as perceived by the customers is termed: a. differentiation b. cost advantage c. price strategy d. cost leadership

a. differentiation

Financial accounting is concerned PRIMARILY with a. external reporting to investors, creditors, and government authorities. b. cost planning and cost controls. c. profitability analysis. d. providing information for strategic and tactical decisions

a. external reporting to investors, creditors, and government authorities.

Which of the following is NOT a basic feature of a managerial accounting system. a. financial measures only b. subjective information c. internal audience d. informs local decision and actions

a. financial measures only

Management accounting a. focuses on estimating future revenues, costs, and other measures to forecast activities and their results. b. provides information about the company as a whole. c. reports information that has occurred in the past that is verifiable and reliable. d. provides information that is generally available only on a quarterly or annual basis.

a. focuses on estimating future revenues, costs, and other measures to forecast activities and their results.

The strategic approach to management requires integrative thinking, i.e., the ability to identify and solve problems: a. from a cross-functional view. b. without using accounting data. c. quickly and decisively. d. under considerable stress.

a. from a cross-functional view.

Strategy specifies a. how an organization matches its own capabilities with the opportunities in the marketplace. b. standard procedures to ensure quality products. c. incremental changes for improved performance. d. the demand created for products and services.

a. how an organization matches its own capabilities with the opportunities in the marketplace.

The Institute of Management Accountants (IMA) a. is a professional organization of management accountants. b. is a professional organization of financial accountants. c. issues standards for management accounting. d. issues standards for financial accounting.

a. is a professional organization of management accountants.

Line management includes a. manufacturing managers. b. human-resource managers. c. information-technology managers. d. management-accounting managers.

a. manufacturing managers.

Which of the following functions provides feedback information about the efficiency of tasks performed? a. operating control b. product and customer costing c. management control d. financial reporting

a. operating control

Financial accounting provides a historical perspective, whereas management accounting emphasizes a. the future. b. past transactions. c. a current perspective. d. reports to shareholders.

a. the future.

Activities that firm in the industry must perform in the process of taking raw material and converting it into final product are known as: a. value activities b. conversion activities c. production activities d. production activities

a. value activities

____________ means reporting and interpreting information that helps managers to focus on operating problems, imperfections, inefficiencies, and opportunities. a. Scorekeeping b. Attention directing c. Problem solving d. None of the above

b. Attention directing

.__________ is when a firm compares itself with the best practice of competitors or other comparable organizations. a. Process improvement b. Benchmarking c. Employee empowerment d. Total quality philosophy

b. Benchmarking

A study of organization that are among the best in the world at performing a particular task a. Business process b. Benchmarking c. Control d. Feedback

b. Benchmarking

All of the following statements are true except: a. A budget is a tool used to plan and express strategy. b. Financial accounting reports financial and nonfinancial information that helps managers implement company strategies. c. Feedback links planning and control. d. Control includes deciding what feedback to provide that will help with future decision making.

b. Financial accounting reports financial and nonfinancial information that helps managers implement company strategies.

Which of the following is a basic feature of a financial accounting system? a. Internal audience b. Historical data c. Subjective information d. Disaggregate information

b. Historical data

___________ produces information that helps workers, managers, and executives in organizations make better decisions. a. Governmental accounting b. Management accounting c. Auditing d. Financial accounting

b. Management accounting

In which situation is a financial manager/management accountant permitted to communicate confidential information to individuals or authorities outside the firm? a. There is an ethical conflict and the board has refused to take action. b. Such communication is legally prescribed. c. The financial manager/management accountant knowingly communicates the information indirectly through a subordinate. d. An officer at the financial manager/management accountant's bank has requested information on a transaction that could influence the firm's stock price.

b. Such communication is legally prescribed.

Which of the is a basic feature of a managerial accounting system? a. The scope tends to be highly aggregate. b. There are no regulations governing the reports. c. The reports are generally delayed and historical. d. The audience tends to be stockholders, creditors and tax authorities.

b. There are no regulations governing the reports.

Integrity is an ethical requirement for all financial managers/management accountants. One aspect of integrity requires a. performance of professional duties in accordance with applicable laws. b. avoidance of conflict of interest. c. refraining from improper use of inside information. d. maintenance of an appropriate level of professional competence.

b. avoidance of conflict of interest.

The Standards of Ethical Conduct for management accountants include concepts related to a. competence, performance, integrity, and reporting. b. competence, confidentiality, integrity and objectivity. c. experience, integrity, reporting, and objectivity. d. none of the above as ethical issues do not affect management accountants.

b. competence, confidentiality, integrity and objectivity.

Strategic management can be defined as the development of sustainable: a. chain of command b. competitive position c. cash flow d. business entity

b. competitive position

Skills or competencies that the firm employs especially well are called: a. critical skills. b. core competencies. c. essential strategies. d. competitive factors.

b. core competencies.

All the information the manager needs to effectively manage the firm or not-for-profit organization is termed: a. planning information. b. cost management information. c. financial information. d. life cycle information.

b. cost management information.

If a financial manager/ management accountant has a problem in identifying unethical behavior or resolving an ethical conflict, the first action (s)he should normally take is to a. consult the board of directors. b. discuss the problem with his/her immediate superior. c. notify the appropriate law enforcement. d. resign from the company.

b. discuss the problem with his/her immediate superior.

Management accounting is considered successful when it a. helps creditors evaluate the company's performance. b. helps managers improve their decisions. c. is accurate. d. is relevant and reported annually

b. helps managers improve their decisions.

Staff management includes a. manufacturing managers. b. human-resource managers. c. purchasing managers. d. distribution managers.

b. human-resource managers.

Certified Management Accountants are required to adhere to the following ethical standards, EXCEPT a. competence. b. ingenuity. c. integrity. d. objectivity.

b. ingenuity.

The control area of management is primarily concerned with: a. standards and variances b. monitoring and evaluation c. structure and discipline d. organization and implementation

b. monitoring and evaluation

Which of the following is NOT a function of a management accounting system? a. operating control b. product and customer costing c. management control d. financial reporting

b. product and customer costing

Which of the following is a basic feature of a managerial accounting system? a. external audience b. reports are current and future oriented c. objective data only d. reports on the entire organization

b. reports are current and future oriented

Which of the following groups would be LEAST likely to receive detailed management accounting reports? a. management accountants b. scientists and engineers c. stockholders d. managers

b. scientists and engineers

The development of a sustainable competitive position - understanding what specific activities are needed for the firm to succeed, and making the appropriate strategic choices - is termed: a. strategic cost management. b. strategic management. c. total quality management. d. activity-based management

b. strategic management.

Which ethical standard is most clearly violated if a financial manager/management accountant knows of a problem that could mislead users but does nothing about it? a. Competence b. Legality c. Objectivity d. Confidentiality

c. Objectivity

.___________ includes strategic, tactical and operating aspects. a. Controlling b. Communication c. Planning d. Evaluating

c. Planning

If an individual faces a conflict between the organization's stated and practiced values experts recommend that a. the individual resign immediately and call the media. b. the individual call the media. c. delay action and work with respected leaders in the organization. d. delay action and hope the problem goes away

c. delay action and work with respected leaders in the organization.

Which of the following is NOT a basic feature of a financial accounting system? a. objective information b. reports on past performance c. future oriented reports d. highly aggregated data

c. future oriented reports

Responsibility of a CFO include all EXCEPT a. providing financial reports to shareholders. b. managing short-term and long-term financing. c. investing in new equipment. d. preparing tax returns.

c. investing in new equipment.

An organization develops a code of ethics because a. it is required by law. b. the Chief Executive Officer demands it. c. it wishes to reduce ethical conflicts by avoiding ambiguity or misunderstandings. d. it wishes to punish those whose ethical standards are different from its own.

c. it wishes to reduce ethical conflicts by avoiding ambiguity or misunderstandings.

Those who develop cost management information are most often referred to as: a. cost accountants. b. operational accountants. c. management accountants. d. industrial accountants.

c. management accountants.

Which of the following functions provides information on the performance of managers and operating units? a. operating control b. product and customer costing c. management control d. financial reporting

c. management control

Katrina is a financial manager who has discovered that her company is violating environmental regulations. If her immediate superior is involved, her appropriate action is to a. do nothing since she has a duty of loyalty to the organization. b. consult the audit committee. c. present the matter to the next higher managerial level. d. confront her immediate superior.

c. present the matter to the next higher managerial level.

Corporate social responsibility is a. effectively enforced through the controls envisioned by classical economics. b. the obligation to shareholders to earn a profit. c. the duty to embrace service to the public interest. d. the obligation to serve long-term, organizational interests.

c. the duty to embrace service to the public interest.

Which of the following is NOT a role of management accounting information in product and customer costing? a. to measure the cost of resources used to produce a service b. to assess the profitability of the organization's services by linking resources generated c. to provide feedback information about the quality, timeliness, and efficiency of tasks performed d. to assess customer profitability for a particular segment

c. to provide feedback information about the quality, timeliness, and efficiency of tasks performed

Which of the following is false? a. Cost accounting measures and reports short-term, long-term financial, and nonfinancial information. b. Cost management provides information that helps increase value for customers. c. All strategies should be evaluated regarding the resources and capabilities of the company. d. A good cost accounting system is narrowly focused on a continuous reduction of costs.

d. A good cost accounting system is narrowly focused on a continuous reduction of costs.

Which of the following types of information are used in management accounting? a. Financial information b. Nonfinancial information c. Information focused on the long term d. All of the above

d. All of the above

If financial manager/management accountant discovers unethical conduct in his/her organization and fails to act, (s)he will be in violation of which ethical standard(s)? a. "Actively or passively subvert the attainment of the organization's legitimate and ethical objectives." b. "Communicate unfavorable as well as favorable information." c. "Condone the commission of such acts by others within their organizations." d. All of the answers are correct.

d. All of the answers are correct.

Which of the following statements is correct? a. The best-designed strategies are valuable whether or not they are effectively implemented. b. To take advantage of changing market opportunities, the annual budget should be strictly enforced. c. Linking rewards to performance is a major deterrent to good management performance. d. An important strategic decision is making the correct investments in productive assets.

d. An important strategic decision is making the correct investments in productive assets.

Which of the following terms does not represent a main focus of cost management information? a. Usefulness b. Timeliness c. Relative accuracy d. Compliance with external reporting requirements

d. Compliance with external reporting requirements

__________ indicate whether the organization is creating long-term value and profitability. a. Strategic information b. ROI c. Net income d. Critical success factors

d. Critical success factors

________ judges implications of historical and expected events and helps to choose the optimum course of action. a. Controlling b. Communication c. Planning d. Evaluating

d. Evaluating

Which of the following description refers to management accounting information? a. It is verifiable and reliable. b. It is driven by rules. c. It is prepared for shareholders. d. It provides reasonable and timely estimates.

d. It provides reasonable and timely estimates.

All of the following statements are false except: a. Attention-directing activities should focus on cost-reduction opportunities, and not on value-adding opportunities. b. For strategic decisions, scorekeeping is the most prominent role played by management accounting. c. A budget may be used as a planning tool, but not as a control tool. d. Management accountants often are simultaneously doing problem-solving, scorekeeping, and attention-directing activities.

d. Management accountants often are simultaneously doing problem-solving, scorekeeping, and attention-directing activities.

Control includes a. implementing planning decisions. b. evaluating performance. c. providing feedback to help with future decision making. d. all of the above.

d. all of the above.

Management accounting includes a. implementing strategies. b. developing budgets. c. preparing special studies and forecasts. d. all of the above.

d. all of the above.

Management accounting information includes a. tabulated results of customer satisfaction surveys. b. the cost of producing a product. c. the percentage of units produced that are defective. d. all of the above.

d. all of the above.

The person MOST likely to use management accounting information is a(n) a. banker evaluating a credit application. b. shareholder evaluating a stock investment. c. governmental taxing authority. d. assembly department supervisor.

d. assembly department supervisor.

Control measures should a. be set and not changed until the next budget cycle. b. be flexible to allow for employees who are slackers. c. be kept confidential from employees so that competitors don't have an opportunity to gain a competitive advantage. d. be linked by feedback to planning.

d. be linked by feedback to planning.

Ethical challenges for management accountants include a. whether to accept gifts from suppliers, knowing it is an effort to indirectly influence decisions. b. whether to report unfavorable department information that may result in unfavorable consequences for a friend. c. whether to file a tax return this year. d. both (a) and (b)

d. both (a) and (b)

For control decisions, emphasis is placed on the ______ role(s) of management accounting. a. problem-solving b. scorekeeping c. attention-directing d. both (b) and (c)

d. both (b) and (c)

The competitive strategy in which the firm succeeds by producing at the lowest cost in the industry is termed: a. differentiation b. cost advantage c. price strategy d. cost leadership

d. cost leadership

Dramatic improvements in communication have resulted in increasing global competition, which has required firms to: a. completely replace existing cost information systems. b. expand existing cost information systems. c. modify existing cost information systems to handle more data. d. develop cost management systems to help firms be more competitive.

d. develop cost management systems to help firms be more competitive.

Linking rewards to performance a. helps to motivate managers. b. allows companies to charge premium prices. c. should only be based on financial information. d. does all of the above.

d. does all of the above.

A common argument against corporate involvement in socially responsible behavior is that a. it encourages government intrusion in decision making. b. as a legal person, a corporation, is accountable for its conduct. c. it creates goodwill. d. in a competitive market, such behavior incurs costs that place the company at a disadvantage.

d. in a competitive market, such behavior incurs costs that place the company at a disadvantage.

Which one of the following describes the type of information that cost management must provide that is not provided by traditional cost accounting systems? a. information of a record keeping nature b. reported financial information c. reported nonfinancial information d. information that addresses the strategic objectives of the firm

d. information that addresses the strategic objectives of the firm

Cost management has moved from a traditional role of product costing and operational control to a broader strategic focus, which places an emphasis on: a. non-competitive pricing b. domestic marketing c. short-term thinking d. integrative thinking

d. integrative thinking

Firms have responded to the recent changes in business in all but which one of the following ways? a. down-sizing the workforce b. developing smaller structures c. outsourcing service functions d. promoting more effective policies

d. promoting more effective policies

The ability to deliver a product or service faster than the competition is termed: a. just-in-time. b. statistical quality control c. flexible manufacturing. d. speed-to-market.

d. speed-to-market.

The development of cost information to facilitate the principal management function is termed: a. life cycle costing. b. activity-based costing c. total quality management d. strategic cost management

d. strategic cost management

A set of policies, procedures and approaches to business to produce long-term success is termed a. critical success factor. b. competitive position. c. mission. d. strategy.

d. strategy.

A financial manager/management accountant discovers a problem that could mislead users of the firm's financial data and has informed his/her immediate superior. (S)he should report the circumstances to the audit committee and/or the board of directors only if a. the immediate superior, who reports to the chief executive officer, knows about the situation but refuses to correct it. b. the immediate superior assures the financial manager/management accountant that the problem will be resolved. c. the immediate superior reports the situation to his/her superior. d. the immediate superior, the firm's chief executive officer, knows about the situation but refuses to correct it.

d. the immediate superior, the firm's chief executive officer, knows about the situation but refuses to correct it.

Which of the following is NOT a role of management accounting information in operating control? a. to provide feedback information about quality b. to provide feedback information about timeliness c. to provide feedback information about the efficiency of tasks performed d. to provide performance measures for decentralized organizational units

d. to provide performance measures for decentralized organizational units

The main focus of cost management information must be: a. reliability and usefulness. b. timeliness and reliability. c. objectivity and reliability. d. usefulness and timeliness.

d. usefulness and timeliness.