Question 1

Which one of the following statements is not true?

Accepted Answer

A)  Cost and management accounting information is generated as frequently as required. 
B)  Accounting is the foundation of strategic and operational decision making. 
C)  Financial accounting and management accounting reports derive their financial information from completely diverse sources. 
D)  Costs are the foundation for decision making by management C

Question 2

Financial accounting reports exhibit a high degree of comparability with the financial accounting reports of other organisations while cost and management accounting reports of different organisations display no such comparability.

Accepted Answer

A) True 
 B)False  True

Question 3

Management accounting is an integral part of management. It requires the identification, generation, presentation, interpretation, and use of relevant information to: Please select all that apply.

Accepted Answer

A)  Design reward strategies for executives and shareholders. 
B)  Safeguard tangible and intangible assets. 
C)  Measure and report financial and non-financial performance to management and other stakeholders. 
D)  Accumulate and allocate costs to cost objects. A,B,C

Question 4

Cost and management accounting information should: Please select all that apply.

Accepted Answer

A)  Faithfully represent what it purports to represent. 
B)  Be understandable. 
C)  Be verifiable. 
D)  Be timely.

Question 5

The provision of costing information to managers undermines organisational efficiency and effectiveness.

Accepted Answer

A) True 
 B)False

Question 6

Which one of the following is the odd one out?

Accepted Answer

A)  Informing operational decisions. 
B)  Gathering and attaching cost information to cost objects. 
C)  Establishing budgets and standard costs. 
D)  Analysing profitability.

Question 7

Which one of the following statements is not true?

Accepted Answer

A)  The cost accounting system is just an extension of the financial accounting system. 
B)  Cost and management accounting reports have both an internal and an external focus. 
C)  Financial accounting reports present internal information to external parties. 
D)  Internal financial costs are the only information that entities require to set the selling prices of products and services.

Question 8

Management accounting is the application of the principles of accounting and financial management to create, protect, preserve and increase value for shareholders.

Accepted Answer

A) True 
 B)False

Question 9

Materiality is a fundamental consideration in the preparation and presentation of financial accounting reports. However, materiality has no role to play in the production of cost and management accounting reports as every detail is relevant.

Accepted Answer

A) True 
 B)False

Question 10

Cost and management accounting information is subject to the cost-benefit rule.

Accepted Answer

A) True 
 B)False

Question 11

The form and content of both financial and cost and management accounting reports are highly regulated.

Accepted Answer

A) True 
 B)False

Question 12

The number of cost objects to which costs can be attached is limited to products, services, centres, activities, customers and distribution channels.

Accepted Answer

A) True 
 B)False

Question 13

Cost accounting is used in organisations to: Please select all that apply.

Accepted Answer

A)  Determine selling prices for products and services. 
B)  Make long-term decisions. 
C)  Calculate product and service costs. 
D)  Monitor and review outcomes as they happen.

Question 14

Management accounting focuses on the long-term not the short-term operations of organisations.

Accepted Answer

A) True 
 B)False

Question 15

Costing is micro level, strategy is macro level.

Accepted Answer

A) True 
 B)False

Exam 1: Cost and Management Accounting in Context

Which one of the following statements is not true?

Financial accounting reports exhibit a high degree of comparability with the financial accounting reports of other organisations while cost and management accounting reports of different organisations display no such comparability.

Management accounting is an integral part of management. It requires the identification, generation, presentation, interpretation, and use of relevant information to: Please select all that apply.

Cost and management accounting information should: Please select all that apply.

The provision of costing information to managers undermines organisational efficiency and effectiveness.

Which one of the following is the odd one out?

Which one of the following statements is not true?

Management accounting is the application of the principles of accounting and financial management to create, protect, preserve and increase value for shareholders.

Materiality is a fundamental consideration in the preparation and presentation of financial accounting reports. However, materiality has no role to play in the production of cost and management accounting reports as every detail is relevant.

Cost and management accounting information is subject to the cost-benefit rule.

The form and content of both financial and cost and management accounting reports are highly regulated.

The number of cost objects to which costs can be attached is limited to products, services, centres, activities, customers and distribution channels.

Cost accounting is used in organisations to: Please select all that apply.

Management accounting focuses on the long-term not the short-term operations of organisations.

Costing is micro level, strategy is macro level.