Question 1

Firm value is created when the value to the customer of receiving products and services exceeds the cost of these activities,

Accepted Answer

A) True 
 B)False  True

Question 2

The Sarbanes-Oxley Act requires that companies provide relevant managerial accounting information to decision-makers.

Accepted Answer

A) True 
 B)False  False

Question 3

Hurricane Wings has budgeted the following costs for a month in which 24,000 wings will be cooked and sold.
$\begin{array}{lr}
\text { Wings, breading, and sauce } & \$ 4,900 \
\text { Direct labor (Variable) } & 3,500 \
\text { Rent } & 1,10 0\
\text { Depreciation } & 900\
\text { Other fixed costs }&400
\end{array}$
Each wing sells for $0.80 each. What is the budgeted total fixed cost?

Accepted Answer

A)  $7,300 
B)  $2,400 
C)  $8,400 
D)  $10,800 
A)  $7,300 
B)  $2,400 
C)  $8,400 
D)  $10,800 B

Question 4

The U.S. government has charged the Institute of Management Accountants with primary responsibility for developing ethics laws that businesses must follow.

Accepted Answer

A) True 
 B)False

Question 5

Which one of the following is the last step in the planning and control process?

Accepted Answer

A)  Implement a plan. 
B)  Construct a plan. 
C)  Make decisions based on the evaluation of the results. 
D)  Compare actual results to the planned results. 
A)  Implement a plan. 
B)  Construct a plan. 
C)  Make decisions based on the evaluation of the results. 
D)  Compare actual results to the planned results.

Question 6

Costs incurred in the past that are not incremental to present decisions are

Accepted Answer

A)  fixed costs. 
B)  sunk costs. 
C)  opportunity costs. 
D)  variable costs. 
A)  fixed costs. 
B)  sunk costs. 
C)  opportunity costs. 
D)  variable costs.

Question 7

ProLight plans to sell 1,600 white lights that enhance indoor plant growth next year with total budgeted sales of $48,000 and estimated profit of $8,000. Variable costs are projected to be $17.50 per unit. Customer A offers to pay $10,000 to buy 400 lights from ProLight. Total fixed costs are $12,000 per year. This offer does not affect ProLight's other planned operations. How much is incremental profit associated with the offer from Customer A?

Accepted Answer

A)  $3,000 
B)  $10,000 
C)  $48,000 
D)  $7,000 
A)  $3,000 
B)  $10,000 
C)  $48,000 
D)  $7,000

Question 8

Which one of the following will most likely influence the actions of managers?

Accepted Answer

A)  Sunk costs 
B)  Performance measures 
C)  Noncontrollable costs 
D)  GAAP 
A)  Sunk costs 
B)  Performance measures 
C)  Noncontrollable costs 
D)  GAAP

Question 9

Which one of the following is most likely to make use of Ralston Enterprises' managerial accounting information?

Accepted Answer

A)  The IRS 
B)  An individual contemplating an investment in Ralston Enterprises 
C)  A company that is one of Ralston's main suppliers 
D)  The production manager of Ralston's plant in Georgia 
A)  The IRS 
B)  An individual contemplating an investment in Ralston Enterprises 
C)  A company that is one of Ralston's main suppliers 
D)  The production manager of Ralston's plant in Georgia

Question 10

Variable cost per unit is budgeted to be $8.00 and fixed cost per unit is budgeted to be $5.00 in a period when 4,000 units are produced. If production is actually 5,100 units, what is the expected total cost of the units produced?

Accepted Answer

A)  $52,000 
B)  $60,800 
C)  $66,300 
D)  $40,800 
A)  $52,000 
B)  $60,800 
C)  $66,300 
D)  $40,800

Question 11

Financial accounting is concerned with presenting results of past transactions, while managerial accounting places considerable emphasis on the future.

Accepted Answer

A) True 
 B)False

Question 12

Hanover Binding plans to produce 40,000 books next year at a total cost of $1,640,000 with a selling price per book of $66.00. The fixed costs total $280,000. Management is considering lowering the price to $60.00 per book, and feels that this action will cause sales to climb to 50,000 books. What will be the incremental costs incurred if 50,000 books are sold?

Accepted Answer

A)  $340,000 
B)  $20,000 
C)  $1,700,000 
D)  $1,300,000 
A)  $340,000 
B)  $20,000 
C)  $1,700,000 
D)  $1,300,000

Question 13

Which of the following is true concerning Enterprise Resource Planning (ERP) systems?

Accepted Answer

A)  They grew out of the material requirements planning systems that preceded them. 
B)  They will allow customers to track their orders. 
C)  They are considered sunk costs. 
D)  All of these answer choices are correct. 
A)  They grew out of the material requirements planning systems that preceded them. 
B)  They will allow customers to track their orders. 
C)  They are considered sunk costs. 
D)  All of these answer choices are correct.

Question 14

A company has a cost that is $3.00 per unit at a volume of 9,000 units and $3.00 per unit at a volume of 11,000 units. What type of cost is this?

Accepted Answer

A)  Fixed 
B)  Variable 
C)  Sunk 
D)  Noncontrollable 
A)  Fixed 
B)  Variable 
C)  Sunk 
D)  Noncontrollable

Question 15

Only amounts that can be expressed in dollars and cents can be used in preparing budgets.

Accepted Answer

A) True 
 B)False

Question 16

Vita Boost Pets produces a line of cat food. In August, it produced and sold 1,000 bags of food. Total fixed costs were $19,000. In September, it produced 2,000 bags of food. Which of the following statements is true for September?

Accepted Answer

A)  Total fixed costs will be $38,000. 
B)  Total fixed costs will be $9,500 
C)  Fixed cost per unit will be $19.00. 
D)  Fixed costs per unit will be $9.50. 
A)  Total fixed costs will be $38,000. 
B)  Total fixed costs will be $9,500 
C)  Fixed cost per unit will be $19.00. 
D)  Fixed costs per unit will be $9.50.

Question 17

In most companies, the top management accountant is called the

Accepted Answer

A)  financial analyst. 
B)  taxation specialist. 
C)  treasurer. 
D)  controller. 
A)  financial analyst. 
B)  taxation specialist. 
C)  treasurer. 
D)  controller.

Question 18

Managerial accounting stresses accounting concepts and procedures that are relevant to preparing reports for

Accepted Answer

A)  investors and banks. 
B)  internal users of accounting information. 
C)  shareholders and creditors. 
D)  the Securities and Exchange Commission (SE
C) . 
A)  investors and banks. 
B)  internal users of accounting information. 
C)  shareholders and creditors. 
D)  the Securities and Exchange Commission (SE
C) .

Question 19

Managerial accounting stresses that the information provided should be useful to decision makers such as creditors and shareholders.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following is a benefit given up when one decision alternative is selected over another?

Accepted Answer

A)  Sunk cost 
B)  Controllable cost 
C)  Opportunity cost 
D)  Incremental cost 
A)  Sunk cost 
B)  Controllable cost 
C)  Opportunity cost 
D)  Incremental cost

Firm value is created when the value to the customer of receiving products and services exceeds the cost of these activities,

The Sarbanes-Oxley Act requires that companies provide relevant managerial accounting information to decision-makers.

Hurricane Wings has budgeted the following costs for a month in which 24,000 wings will be cooked and sold. Wings, breading, and sauce \ 4,900 Direct labor (Variable) 3,500 Rent 1,100 Depreciation 900 Other fixed costs 400 Each wing sells for $0.80 each. What is the budgeted total fixed cost?

The U.S. government has charged the Institute of Management Accountants with primary responsibility for developing ethics laws that businesses must follow.

Which one of the following is the last step in the planning and control process?

Costs incurred in the past that are not incremental to present decisions are

Which one of the following will most likely influence the actions of managers?

Which one of the following is most likely to make use of Ralston Enterprises' managerial accounting information?

Variable cost per unit is budgeted to be $8.00 and fixed cost per unit is budgeted to be $5.00 in a period when 4,000 units are produced. If production is actually 5,100 units, what is the expected total cost of the units produced?

Financial accounting is concerned with presenting results of past transactions, while managerial accounting places considerable emphasis on the future.

Which of the following is true concerning Enterprise Resource Planning (ERP) systems?

A company has a cost that is $3.00 per unit at a volume of 9,000 units and $3.00 per unit at a volume of 11,000 units. What type of cost is this?

Only amounts that can be expressed in dollars and cents can be used in preparing budgets.

Vita Boost Pets produces a line of cat food. In August, it produced and sold 1,000 bags of food. Total fixed costs were $19,000. In September, it produced 2,000 bags of food. Which of the following statements is true for September?

In most companies, the top management accountant is called the

Managerial accounting stresses accounting concepts and procedures that are relevant to preparing reports for

Managerial accounting stresses that the information provided should be useful to decision makers such as creditors and shareholders.

Which of the following is a benefit given up when one decision alternative is selected over another?

Job-Order Costing for Manufacturing and Service Companies

Process Costing

Cost-Volume-Profit Analysis

Variable Costing

Cost Allocation and Activity-Based Costing

The Use of Cost Information in Management Decision Making

Pricing Decisions

Capital Budgeting Decisions

Budgetary Planning and Control

Standard Costs and Variance Analysis

Decentralization and Performance Evaluation

Statement of Cash Flows

Filters

Exam 1: Managerial Accounting in the Information Age

Firm value is created when the value to the customer of receiving products and services exceeds the cost of these activities,

The Sarbanes-Oxley Act requires that companies provide relevant managerial accounting information to decision-makers.

Hurricane Wings has budgeted the following costs for a month in which 24,000 wings will be cooked and sold. Wings, breading, and sauce \ 4,900 Direct labor (Variable) 3,500 Rent 1,100 Depreciation 900 Other fixed costs 400 Each wing sells for $0.80 each. What is the budgeted total fixed cost?

The U.S. government has charged the Institute of Management Accountants with primary responsibility for developing ethics laws that businesses must follow.

Which one of the following is the last step in the planning and control process?

Costs incurred in the past that are not incremental to present decisions are

Which one of the following will most likely influence the actions of managers?

Which one of the following is most likely to make use of Ralston Enterprises' managerial accounting information?

Variable cost per unit is budgeted to be $8.00 and fixed cost per unit is budgeted to be $5.00 in a period when 4,000 units are produced. If production is actually 5,100 units, what is the expected total cost of the units produced?

Financial accounting is concerned with presenting results of past transactions, while managerial accounting places considerable emphasis on the future.

Which of the following is true concerning Enterprise Resource Planning (ERP) systems?

A company has a cost that is $3.00 per unit at a volume of 9,000 units and $3.00 per unit at a volume of 11,000 units. What type of cost is this?

Only amounts that can be expressed in dollars and cents can be used in preparing budgets.

Vita Boost Pets produces a line of cat food. In August, it produced and sold 1,000 bags of food. Total fixed costs were $19,000. In September, it produced 2,000 bags of food. Which of the following statements is true for September?

In most companies, the top management accountant is called the

Managerial accounting stresses accounting concepts and procedures that are relevant to preparing reports for

Managerial accounting stresses that the information provided should be useful to decision makers such as creditors and shareholders.

Which of the following is a benefit given up when one decision alternative is selected over another?

Job-Order Costing for Manufacturing and Service Companies

Process Costing

Cost-Volume-Profit Analysis

Variable Costing

Cost Allocation and Activity-Based Costing

The Use of Cost Information in Management Decision Making

Pricing Decisions

Capital Budgeting Decisions

Budgetary Planning and Control

Standard Costs and Variance Analysis

Decentralization and Performance Evaluation

Statement of Cash Flows

Filters