Exam 9: Management Control Systems and Responsibility Accounting

The following information is available for Discounted Supplies Inc.and its two divisions,Durable Goods and Nondurable Goods. Fixed costs controllable by Fixed costs not controlled by Variable costs: What is the income before taxes for the company as a whole?

The Bargain Dollar Company owns a chain of department stores.Costs for the department store in Cleveland,Ohio are listed below.Identify each cost as one of the following: _____ 1.Property taxes on Cleveland store _____ 2.Sales supervisor's salary in Cleveland store _____ 3.Depreciation expense on store fixtures in Cleveland store _____ 4.Corporate-level advertising costs _____ 5.Temporary sales staff wages in Cleveland store _____ 6.Cost of merchandise sold in Cleveland store _____ 7.Local advertising costs for Cleveland store _____ 8.CEO salary

Inspection costs of incoming raw materials are ________ costs.

Decreasing cycle time often results in bringing products more quickly to customers.

The term "cost center" may be used to describe responsibility centers that are assigned responsibility for capital investment.

Managers in profit centers are responsible for controlling ________ and ________.

What is the first step in designing a management control system?

Nonfinancial measures of performance include profit targets and required return on investment.

________ are characteristics or attributes that managers must achieve to drive the organization toward its goals.

Some people argue that managers of profit centers should be held responsible for the center's entire profit.They are responsible for the center's profit even if they cannot control all factors affecting it.Do you agree with this point of view?

A key driver of performance is the culture within the organization that fosters continual learning and growth.

The keys to successful management control in any organization are proper training of employees,motivation of employees and consistent monitoring of performance measures.

The following information is available for Half Price Books Inc.and its two divisions,Books and Periodicals: Fixed Costs Controllable Fixed Costs Not Controlled Variable Costs: What is the contribution margin for the Periodicals Division?

Productivity is a measure of inputs divided by outputs.

The entire firm may be a responsibility center for the firm's president.

An example of a nonfinancial goal is ________.

Segments are responsibility centers for which a separate measure of revenues and costs is obtained.

In the management control system,feedback and learning affect all elements of the system.

Property taxes on a building used by a segment are not considered when evaluating the performance of the segment manager.

In most organizational settings,superior ________ performance usually follows from superior ________ performance.