Question 1

The controller (or chief accounting officer):

Accepted Answer

A)   has overall responsibility for the management accounting function
B)   has overall responsibility for purchasing stock
C)   gathers all financial data and prepares all financial reports
D)   all of the above A

Question 2

Complete a performance report for the month of May, 2014, for the Daily Bulletin, a regional newspaper showing four columns: 1) Actual Result; 2) Budgeted Amount; 3) Difference: Actual Result minus Budgeted Amount; 4) Difference as a Percentage of Budgeted Amount, given the following data:
  Does the report indicate any cause for managerial investigation?

Accepted Answer

The performance report should look something like the following:
  The overall 3.75% unfavorable difference in advertising revenue is caused by offsetting differences in advertising pages sold (favorable) and the average rate per page (unfavorable). The performance report highlights the favorable increase in the advertising pages sold. While the percentage drop in advertising revenue per page is also dramatic, management might want to investigate the reasons behind such a drop. Some possibilities include: aggressive price reductions to obtain revenue, or some aggressive competition, or an unrealistic budget.

Question 3

The principle of integrity imposes an obligation on all professional accountant to be straightforward and honest in all professional and business relationships. Integrity also implies fair dealing and truthfulness.

Accepted Answer

A) True 
 B)False  True

Question 4

List some examples of comparative information that can be supplied for inclusion in the financial reporting process.

Accepted Answer

The answer of List some examples of comparative information that...

Question 5

While the income statement includes all sources of revenue, the revenue and expenditure report focuses only on the revenue generated by the company's core operations and sales.

Accepted Answer

A) True 
 B)False

Question 6

The International Ethics Standards Board for Accountants (IESBA) has developed a code of ethics for management accountants which includes concepts related to:

Accepted Answer

A)   integrity, objectivity, professional competence and due care, and confidentiality
B)   competence, performance, integrity, and reporting
C)   experience, integrity, reporting, and objectivity
D)   None of these answers are correct.

Question 7

Long term financing is an integral part of the ________ function in an organization.

Accepted Answer

A)   internal audit
B)   president's
C)   controller's
D)   treasurer's

Question 8

Management accounting has to strictly follow the rules of international financial reporting standards for the purposes of measurement and reporting.

Accepted Answer

A) True 
 B)False

Question 9

The focus of financial analysis is:

Accepted Answer

A)   the comparison between projected revenues and costs and actual revenues and costs
B)   to help managers make decisions to fulfill an organization's goals
C)   to predict the likely revenues over the next reporting period
D)   all of the above

Exam 1: The Manager and Management Accounting

The controller (or chief accounting officer) :