Exam 1: The Changing Role of Managerial Accounting in a Dynamic Business Environment

The process of managing the various activities in the value chain, along with the associated costs, is commonly known as:

Which of the following can be linked to a wave of corporate scandals that took place not too long ago?

Managerial accounting:

Consider the descriptors that follow. 1. Is heavily involved with the recordkeeping and reporting of assets, liabilities, and stockholders' equity. 2. Focuses on planning, decision making, directing, and control. 3. Is heavily regulated. 4. A field that is becoming more "cross-functional" in nature. 5. Much of the field is based on costs and benefits. 6. Is involved almost exclusively with past transactions and events. 7. Much of the information provided is directed toward stockholders, financial analysts, creditors, and other external parties. 8. Tends to focus more on subunits within an entity rather than the organization as a whole. 9. May become involved with measures of customer satisfaction, and the amount of actual cost incurred vs. budgeted targets. Required: Determine whether the descriptors are most closely associated with financial accounting or managerial accounting.

Cost management systems tend to focus on an organization's:

Which of the following acts strives to improve corporate governance and the quality of corporate accounting/reporting?

The process of encouraging and authorizing workers to take appropriate initiatives to improve the overall firm is commonly known as:

Managerial accountants:

Which of the following is not a function of the treasurer?

Many professions have adopted a series of ethical standards to provide guidance for their memberships. The Institute of Management Accountants (IMA), for example, has published standards that focus on competence, confidentiality, integrity, and credibility. In light of these standards, consider the three cases that follow. Case A-Leston Corporation has experienced serious financial difficulties in recent years. John Young, the company's chief financial officer, has just learned that a major competitor was likely to file for bankruptcy; however, he failed to disclose this information at a board meeting held later that day when a plant closure decision was being discussed. The board evaluated several proposals during the session that focused on improving Leston's financial position. Case B-QBX Company manufactures fertilizer from various raw materials, including a raw material know as Felstar. Paul Kelly, the firm's purchasing manager, purposely acquired a lower grade of Felstar than normal because of a very attractive price. The lower-grade product resulted in increased usage during the manufacturing process but had no effect on the fertilizer's overall quality. An end-of-period report showed that QBX profited from Kelly's actions, with the overall savings in purchase price more than offsetting the cost of added consumption. Case C-Central Distributing has a participative budgeting process, allowing employees to have a say in projected sales targets for the upcoming period. These targets are reflected in a series of performance reports that compare actual sales achieved against targeted amounts. Hillary Baxter submitted very low sales targets because, as she confided in a colleague, "I always want to look good in terms of meeting targets, even if anticipated sales and closures don't materialize." Required: Evaluate the three cases and determine the ethical issues, if any, that are involved. Cite the IMA's standards if appropriate.

The capacity concept that allows for normal occurrences such as machine downtime and employee fatigue is known as:

Which of the following managerial functions involves a detailed financial and operational description of anticipated operations?

The value chain of a manufacturer would tend to include activities related to:

Which of the following employees at Delta Airlines would not be considered as holding a line position?

Which of the following is not an ethical standard of managerial accounting?

A controller is normally involved with preparing financial statements.

Which of the following is not an element of competency?

The chief managerial and financial accountant of an organization is the:

The cost of resources supplied but unused is known as:

Which of the following employees would be considered as holding a line position?