Exam 1: Managerial Accounting Concepts and Principles

Both financial and managerial accounting report monetary information; managerial accounting also reports considerable nonmonetary information.

Crane, Inc. reported the following data regarding costs and inventories for the current year: beginning goods-in-process inventory, $4,000; beginning finished goods inventory, $2,000; cost of goods manufactured, $11,500; operating expenses, $3,000; ending finished goods inventory, $1,000; ending goods-in-process inventory, $1,500. Cost of goods sold for Crane, Inc. equals ________.

For a manufacturer, the cost of goods sold can be computed by adding the beginning finished goods inventory to ________ and then subtracting the ending finished goods inventory.

Managerial accounting provides financial and nonfinancial information to an organization's managers and other internal decision makers.

Last year, Flash Company sold 15,000 units of its only product. If sales increased by 20% in the current year, how will total variable cost and total fixed cost be affected?

Managerial accounting reports and information are used by external users and financial accounting by internal users.

Which of the following represents the correct formula for calculating days' sales in raw materials inventory for a manufacturer?

Last year, Gordon Company sold 20,000 units of its only product. If sales increase by 20% in the current year, how will unit variable cost and total fixed cost be affected?

The model whose goal is to eliminate waste while satisfying the customer and providing a positive return to the company is the ________.

Direct materials are not easily traced to a product.

Total quality management (TQM) is a system that acquires inventory and produces only when needed.

For each item shown below, classify it as a product cost or a period cost, by placing an X in the appropriate column. For each item that is a product cost, also indicate whether it is a direct cost or an indirect cost with respect to a unit of finished product.

________ inventory consists of goods a company acquires to use in making products.

________ are beliefs that distinguish right from wrong.

A manufacturing company has a beginning finished goods inventory of $14,600, raw material purchases of $18,000, cost of goods manufactured of $32,500, and an ending finished goods inventory of $17,800. The cost of goods sold for this company is:

Enterprise risk management (ERM) includes the systems and process companies use to maximize the effect of risk.

Costs are important to managers because they impact both the financial position and profitability of a business.

The series of activities that add value to a company's products or services is called a value chain.

Last year, Flash Company sold 15,000 units of its only product. If sales decreased by 17% in the current year, how will total variable cost and total fixed cost be affected?

The Institute of Management Accountants (IMA) Statement of Ethical Professional Practice requires that management accountants be competent and act with integrity.