Deck 1: Management Accounting in Context

Question 1

Management accounting:

A)focuses on estimating future revenues,costs,and other measures to forecast activities and their results.
B)reports information in accordance with relevant accounting standards.
C)provides information to external parties.
D)provides information that is generally available only on a quarterly or annual basis.

Answer 1

A

Question 2

Management accountants evaluate the costs and revenue benefits of ________ initiatives.

A)strategic
B)tactical
C)operational
D)TQM

Answer 2

D

Question 3

Which of the following descriptors refers best to management accounting information?

A)It is verifiable and reliable.
B)It is prepared for shareholders.
C)It is driven by rules.
D)It provides reasonable and timely estimates.

Answer 3

D

Question 4

The person MOST likely to use management accounting information is a(n):

A)governmental taxing authority.
B)banker evaluating a credit application.
C)assembly department supervisor.
D)shareholder evaluating a share investment.

Question 5

Financial accounting:

A)reports include detailed information on the various operating segments of the business such as product lines or departments.
B)focuses on the future and includes activities such as preparing next year's operating budget.
C)is prepared for the use of department heads and other employees.
D)must comply with GAAP (generally accepted accounting principles).

Question 6

Which of the following best describes an Enterprise Resource Planning System?

A)A database that is primarily used by a purchasing department to determine the correct amount of a particular supply item to purchase
B)A sophisticated means of linking two or more companies to facilitate their planning processes
C)A single database that collects data and feeds it into applications that support each of the company's business activities,such as purchases,production,distribution,and sales
D)A collection of programs that use a variety of unconnected databases

Question 7

In most organisations,there are also ________ relationships that managers must understand when they attempt to implement their decisions.

A)informal
B)strategic
C)interpersonal
D)tactical

Question 8

Which of these types of information are used in management accounting?

A)Financial information
B)Information focused on the long term
C)Non-financial information
D)All of these answers are correct.

Question 9

Modern cost accounting plays a role in:

A)planning new products.
B)controlling costs.
C)evaluating operational processes.
D)All of these answers are correct.

Question 10

While financial accounting provides a historical perspective,what does management accounting emphasise?

A)past transactions
B)the future
C)reports to shareholders
D)a current perspective

Question 11

The approaches and activities of managers in short-run and long-run planning and control decisions that increase value for customers and lower costs of products and services are known as:

A)enterprise resource planning.
B)customer value management.
C)value chain management.
D)cost management.

Question 12

What is the PRIMARY criterion when faced with a resource allocation decision?

A)Cost minimisation
B)How well the alternative options help achieve organisational goals in relation to the costs incurred for these systems
C)Reduction in the amount of time required to perform a particular job
D)Achievement of organisational goals

Question 13

Which of the following is MOST likely to use ONLY financial accounting information?

A)Vice CEO of operations
B)Department manager
C)Current shareholder
D)Factory shift supervisor

Question 14

Which of the following statements about the cost-benefit approach is TRUE?

A)Resources should be spent if the costs of a decision outweigh the benefits of the decision.
B)In a cost-benefit analysis,both costs and benefits are easy to obtain.
C)Resources should be spent if they are expected to better attain company goals in relation to the expected costs of these resources.
D)A cost-benefit approach would not be appropriate for a decision to install a budget system or not.

Question 15

Companies report on their approach to maintaining sustainability in:

A)the report on social responsibility.
B)the income statement.
C)the balance sheet.
D)None of the above.

Question 16

Which statement refers best to management accounting information?

A)It primarily measures and records business transactions.
B)The audience tends to be shareholders,creditors,and tax authorities.
C)There are no regulations governing the reports.
D)The reports are generally delayed and historical.

Question 17

Management accounting information includes:

A)the cost of producing a product.
B)tabulated results of customer satisfaction surveys.
C)the percentage of units produced that are defective.
D)All of these answers are correct.

Question 18

A data warehouse or infobarn:

A)is primarily used for financial reporting purposes.
B)stores information used by different managers for multiple purposes.
C)gathers only non-financial information.
D)is reserved for exclusive use by the CFO.

Question 19

Cost accounting provides all of the following EXCEPT:

A)pricing information from marketing studies.
B)information for management accounting and financial accounting.
C)financial information regarding the cost of acquiring resources.
D)non-financial information regarding the cost of operational efficiencies.

Question 20

Financial accounting is concerned PRIMARILY with:

A)cost planning and cost controls.
B)providing information for strategic and tactical decisions.
C)external reporting to investors,creditors,and government authorities.
D)profitability analysis.

Question 21

Cost accounting systems provide information only for management accounting purposes.

Question 22

Financial accounting reports financial and non-financial information that helps managers implement company strategies.

Question 23

Cost management provides information that helps increase value for customers.

Question 24

Management accounting information focuses on external reporting.

Question 25

Who is primarily responsible for management accounting and financial accounting?

A)CIO (Chief Information Officer)
B)COO (Chief Operating Officer)
C)Treasurer
D)Chief Management Accounting officer or controller

Question 26

Management accounting has to strictly follow the rules of generally accepted accounting principles for the purposes of measurement and reporting.

Question 27

Management accounting is an integral part of the ________ function in an organisation.

A)taxation
B)treasury
C)internal audit
D)None of the above.

Question 28

Managers always require the information in an accounting system to be presented in the same format.

Question 29

What has happened to the differences between staff and line management as teamwork has become more prominent in the last few years?

A)Have increased.
B)Have only been evident in the employee reward system.
C)Have become more important relative to promotions.
D)Have diminished.

Question 30

The Chartered Institute of Management Accountants (CIMA):

A)issues standards for financial accounting.
B)has its headquarters in the USA.
C)is a professional organisation of management accountants.
D)is a professional organisation of financial accountants.

Question 31

An ideal database should consist of data that could be used for a single purpose only.

Question 32

Responsibilities of a Chief Financial Officer (CFO )include all of the following EXCEPT:

A)chairing the board of directors.
B)supervising the preparation of tax returns.
C)managing short-term and long-term financing.
D)providing financial reports to shareholders.

Question 33

Examples of the Chief Management Accountant's functions include all EXCEPT:

A)planning.
B)investor relations.
C)operations administration.
D)budgeting.

Question 34

The person(s)directly responsible for attaining organisational objectives is/are:

A)line management.
B)the chief financial officer.
C)the controller.
D)the treasurer.

Question 35

What does staff management include?

A)Human resource managers
B)Distribution managers
C)Purchasing managers
D)Manufacturing managers

Question 36

Cost management is narrowly focused on a continuous reduction of costs.

Question 37

Where an organisation is large enough to employ both a chief financial officer (CFO)and a management accountant,the management accountant reports to the ________ .

A)president
B)board of directors
C)CEO
D)CFO

Question 38

What does line management include?

A)Information-technology managers
B)Management-accounting managers
C)Human resource managers
D)Manufacturing managers

Question 39

The balance sheet,income statement,and cash flow statement are used for financial accounting,but not for management accounting.

Question 40

All of the following report to the Chief Financial Officer (CFO)EXCEPT the:

A)Production Manager.
B)Company Secretary.
C)Chief Management Accountant.
D)Tax Department Manager.

Question 41

Key success factors can exist in both the ________ areas and the condition or circumstances of the company.

A)cultural
B)structural
C)functional
D)logistical

Question 42

For each report listed below,identify whether the major purpose of the report is for (1)routine internal reporting, (2)non-routine internal reporting,or for (3)external reporting to investors and other outside parties.
Item:
a.study detailing sale information of the top-ten selling products
b.weekly report of total sales generated by each store in the metropolitan area
c.annual report sent to shareholders
d.monthly report comparing budgeted sales by store to actual sales

Question 43

CPA Australia and the Institute of Chartered Accountants in Australia (ICAA)established the Accounting Professional and Ethical Standards Board.

Question 44

Place the four business functions in the order they appear along the value chain:
A = Customer service
B = Design
C = Distribution
D = Production

A)B A D C
B)A B D C
C)A C D B
D)B D C A

Question 45

The value chain is the sequence of business functions in which:

A)value is deducted from the products or services of an organisation.
B)products and services are evaluated with respect to their value to the supply chain.
C)usefulness is added to the products or services of an organisation.
D)value is proportionately added to the products or services of an organisation.

Question 46

Describe management accounting and financial accounting.

Question 47

The use of teams to achieve corporate objectives is increasing.

Question 48

Discuss the cost-benefit approach guideline management accountants use to provide value in strategic decision making.

Question 49

Is financial accounting or management accounting more useful to an operations manager? Why?

Question 50

Is it possible to have an active cost management program without an Enterprise Resource Planning (ERP)System?

Question 51

How does a controller help 'control' a company?

Question 52

What competitive advantage could a company obtain from a successful cost management program?

Question 53

What are R&D,production,and customer service as business functions included as part of?

A)Marketing
B)Benchmarking
C)The supply chain
D)The value chain

Question 54

The chief financial officer (CFO)is usually responsible for banking,short- and long-term financing,investments,and cash management.

Question 55

What areas of responsibility does a Chief Financial Officer (CFO)have in a typical organisation?

Question 56

New product development time is the time it takes for ________ products to be created and brought to market.

A)old
B)obsolete
C)all
D)new

Question 57

Which of the following involves the generation of,and experimentation with,ideas related to new products,services,or processes?

A)Design of products,services,or processes
B)Marketing
C)Research and development
D)Production

Question 58

Management accountants calculate a ________ cost for a product by subtracting the operating profit per unit of product that the company thinks it can earn from the 'target price'.

A)reasonable
B)target
C)systematic
D)estimated

Question 59

________ are those functions,activities or business practices,defined by the market not the company,and as viewed by the customer,that are critical to the vendor/customer relationship.

A)Operations
B)Cycles
C)Tactics
D)Key success factors

Question 60

Discuss the potential behaviour implications of performance evaluation.

Question 61

Customer response time involves:

A)the time it takes an organisation to develop a Total Quality Management (TQM)program.
B)the time it takes to develop a new product.
C)the speed at which an organisation responds to customer requests.
D)the time it takes a customer to respond to an advertisement and place an order.

Question 62

The function in the value chain concerned with promoting and selling products or services to customers is:

A)marketing.
B)customer service.
C)production.
D)distribution.

Question 63

Customer relationship management initiatives use technology to coordinate all:

A)inventory management activities.
B)production activities.
C)customer-facing activities.
D)research activities.

Question 64

When ________ are aligned with key success factors,the value of the business relationship blossoms and grows for the benefit of both the company and the customer.

A)strategies
B)values
C)cores competencies
D)ethics

Question 65

Companies gain (in terms of cost,quality and the speed with which new products are developed)if ________ of the individual business functions of the value chain work concurrently as a team.

A)two or more
B)one or more
C)three or more
D)four or more

Question 66

________ is the after-sale support provided to customers.

A)Marketing
B)Production
C)Customer service
D)Distribution

Question 67

Companies use the term ________ to describe a strategy that integrates people and technology in all business functions to enhance relationships with customers,partners and distributors.

A)cost leadership
B)product differentiation
C)market penetration
D)customer relationship management

Question 68

Customers generally demand improved performance related to:

A)both reduced costs and increased quality.
B)reduced costs.
C)lower costs,improved quality,and improved customer service.
D)All of these answers are correct.

Question 69

Which of the following is NOT a way for a company to improve customer response time?

A)Produce the product more quickly.
B)Purchase material in larger quantities.
C)Increase capacity of bottleneck operations.
D)Use faster delivery procedures.

Question 70

Strategy should focus PRIMARILY on the organisation's:

A)customers.
B)products.
C)employees.
D)shareholders.

Question 71

________ is the acquisition,coordination,and assembly of resources to produce a product or deliver a service.

A)Production
B)Research and development
C)Marketing
D)Customer service

Question 72

________ focus on internal activities,practices and functions.

A)Core competencies
B)Key success factors
C)Strategies
D)Values

Question 73

Key success factors can exist in both the ________ areas and the condition or circumstances of the company.

A)dynamic
B)functional
C)static
D)organisational

Question 74

________ is a philosophy in which management improves operations throughout the value chain to deliver products and services that exceed customer expectations.

A)Total quality management
B)Customer focus
C)Customer relationship management
D)Cost-benefit approach

Question 75

Whose perceptions of the company's products or services are most important to the manager?

A)chairman of the boards' perception
B)board of directors' perception
C)shareholders' perception
D)customers' perception

Question 76

Companies make a strategic decision to create and add value by operating across the entire supply chain for the industry or to select a segment of it.

Question 77

________ is the manner by which companies promote and sell their products or services to customers or prospective customers.

A)Customer service
B)Distribution
C)Research and development
D)Marketing

Question 78

By analysing activities,managers are able to integrate and coordinate them across suppliers and customers in the supply chain,as well as across business functions in an individual company's value chain,with a view to reducing costs.

Question 79

A company needs to be ________ to be successful.

A)'driven' by the board of directors
B)management-driven
C)employee-driven
D)customer-driven

Question 80

________ is the delivery of products or services to customers.

A)Distribution
B)Production
C)Customer service
D)Design of products,services,or processes