Exam 1: Introduction to Managerial Accounting

Six Sigma is a program that aims at producing near perfection and goes hand in hand with lean thinking.

The design of a management accounting system should consider how reports affect employees' behavior.

Country Western Clothing Outfitters is considering investing in an inventory tracking system. It will have $10,500 in software costs and $8800 in employee training costs. Computer hardware also needs to be upgraded for the system; the hardware upgrades are expected to be $12,600. The expected benefits from the inventory tracking system should be $28,800. Do the benefits outweigh the costs or do the costs outweigh the benefits, and by how much?

In 2013, the employee at Lighthouse Services prepared an annual report for the bank that revealed total revenue in 2012 was $6,000,000. The manager needs the information to apply for a loan to purchase new equipment to maintain the operations at the organization. The report was prepared in accordance with GAAP and the report contained information about the 2012 financial performance at the company. Which of the following describes the role of the employee at Lighthouse Services?

The focus of management accounting is on

The CFO is the person responsible for the day-to-day operations of the company.

Which of the following positions is primarily responsible for raising capital and investing funds?

The new employee at Cork Manufacturing reported to work and the employee reviewed the following information that was audited by the CPA: Which of the following describes the role of the new employee?

Managerial accounting develops reports that help internal parties effectively and efficiently run the company.

Managerial accountants are employed by which type of companies?

Which of the following groups are external users of financial information?

The ________ is a subcommittee of the Board of Directors.

The management accountant at Technology Innovators determined $500,000 is the organization's earning goal to accommodate the organizational plan during the first quarter during a new year. The accountant realizes that to achieve the new earning goal, the operations manager needs to increase the price of technology parts charged to a consumer to $250.00 per unit. The manager is scheduling a new staff meeting to determine if they need to increase the marketing efforts at the firm, or if they need to design a new part that uses materials that are less expensive to produce. Which of the following management responsibilities is the managerial accountant using in this example?

The ethical principles and standards of the IMA's Statement of Professional Practice always provide clear guidance for every unethical situation.

Which of the following is not one of the IMA's credibility standards?

________ gathers, summarizes, and reports on the financial impact of changes to business operations.

Managerial accountants only need a solid understanding of managerial accounting, and not financial accounting.

Johnson Scooter Company is considering whether or not to expand into a new area of the United States. They produce high-performance gas scooters with moderate gas mileage, but have developed a new battery technology that combines a small amount of electrical energy with the existing gas power. This new technology will significantly increase the fuel economy of their bikes. They will need to spend $5,075,000 to retrofit a building to incorporate the new fuel-saving technology. New worker training will cost $1,984,000. Other expenses involved to set up and run the new plant are $332,000. The CEO anticipates that, with gas price increases, the profit potential of this expansion is $7,588,000. Do the benefits outweigh the costs, or do the costs outweigh the benefits, and by how much?

Managerial accounting information emphasizes relevance over reliability and objectivity.

Which of the following role is directly responsible for all financial functions in an organization?