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ACC 560 WK 2 Quiz 1
TRUE-FALSE STATEMENTS 1. Reports prepared in financial accounting are general-purpose reports, whereas reports prepared in managerial accounting are usually special-purpose reports.2. 2. Managerial accounting information generally pertains to an entity as a whole and is highly aggregated.
3. Managerial accounting applies to all forms of business organizations.
4. Determining the unit cost of manufacturing a product is an output of financial accounting.
5. Managerial accounting internal reports are prepared more frequently than are classified financial statements.
6. The management function of organizing and directing is mainly concerned with setting goals and objectives for the entity.
7. The Sarbanes-Oxley Act replaces generally accepted accounting principles in a manufacturing company.
8. Controlling is the process of determining whether planned goals are being met.
9. Decision-making is an integral part of the planning, directing, and controlling functions.
10. Direct materials costs and indirect materials costs are manufacturing overhead.
11. Manufacturing costs that cannot be classified as direct materials or direct labor are classified as manufacturing overhead.
12. Raw materials are equal to direct materials minus indirect materials.
13. Raw materials that can be conveniently and directly associated with a finished product are called materials overhead.
14. The total cost of a finished product does not generally contain equal amounts of materials, labor, and overhead costs.
15. Both direct labor cost and indirect labor cost are product costs.
16. Period costs include selling and administrative expenses.
17. Indirect materials and indirect labor are both inventoriable costs.
18. Direct materials and direct labour are the only product costs.
19. Total period costs are deducted from total cost of work in process to calculate cost of goods manufactured. |
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20. Period costs are not inventoriable costs.
21. Ending finished goods inventory appears on both the balance sheet and the income statement of a manufacturing company.
22. The beginning work in process inventory appears on both the balance sheet and the cost of goods manufactured schedule of a manufacturing company.
23. In calculating gross profit for a manufacturing company, the cost of goods manufactured is deducted from net sales.
24. Finished goods inventory does not appear on a cost of goods manufactured schedule.
25. If the ending work in process inventory is greater than the beginning work in process inventory, then the cost of goods manufactured will be less than total manufacturing costs for the period.
26. Finished goods inventory for a manufacturing company is equivalent to merchandise inventory for a merchandising company.
27. Raw materials inventory shows the cost of completed goods available for sale to customers.
28. The balanced scorecard approach attempts to maintain as little inventory on hand as possible.
29. The supply chain is all the activities associated with providing a product or service.
30. Many companies have significantly lowered inventory levels and costs using just-in-time inventory methods.
31. Managerial accounting is primarily concerned with managers and external users.
32. Planning involves coordinating the diverse activities and human resources of a company to produce a smooth running operation.
33. When the physical association of raw materials with the finished product is too small to trace in terms of cost, they are usually classified as indirect materials.
34. Product costs are also called inventoriable costs.
35. Direct materials become a cost of the finished goods manufactured when they are acquired, not when they are used.
36. The sum of the direct materials costs, direct labor costs, and beginning work in process is the total manufacturing costs for the year. |
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37. In a manufacturing company balance sheet, manufacturing inventories are reported in the current assets section in the order of their expected use in production.
MULTIPLE CHOICE QUESTIONS 38. Managerial accounting applies to each of the following types of businesses except a. service firms. b. merchandising firms. c. manufacturing firms. d. Managerial accounting applies to all types of firms.
39. Managerial accounting information is generally prepared for a. stockholders. b. creditors. c. managers. d. regulatory agencies.
40. Managerial accounting information a. pertains to the entity as a whole and is highly aggregated. b. pertains to subunits of the entity and may be very detailed. c. is prepared only once a year. d. is constrained by the requirements of generally accepted accounting principles.
41. The major reporting standard for presenting managerial accounting information is a. relevance. b. generally accepted accounting principles. c. the cost principle. d. the current tax law.
42. Managerial accounting is also called a. management accounting. b. controlling. c. analytical accounting. d. inside reporting.
43. Which of the following is not an internal user? a. Creditor b. Department manager c. Controller d. Treasurer
44. Managerial accounting does not encompass a. calculating product cost. b. calculating earnings per share. c. determining cost behavior. d. profit planning.
45. Managerial accounting is applicable to a. service entities. b. manufacturing entities. c. not-for-profit entities. d. all of these.
46. Management accountants would not a. assist in budget planning. b. prepare reports primarily for external users. c. determine cost behavior. d. be concerned with the impact of cost and volume on profits.
47. Internal reports must be communicated a. daily. b. monthly. c. annually. d. as needed.
48. Financial statements for external users can be described as a. user-specific. b. general-purpose. c. special-purpose. d. managerial reports.
49. Managerial accounting reports can be described as a. general-purpose. b. macro-reports. c. special-purpose. d. classified financial statements.
50. The reporting standard for external financial reports is a. industry-specific. b. company-specific. c. generally accepted accounting principles. d. department-specific.
51. Which of the following statements about internal reports is not true? a. The content of internal reports may extend beyond the double-entry accounting system. b. Internal reports may show all amounts at market values. c. Internal reports may discuss prospective events. d. Most internal reports are summarized rather than detailed.
52. In an analogous sense, external user is to internal user as generally accepted accounting principles are to a. timely. b. special-purpose. c. relevance to decision. d. SEC.
53. Internal reports are generally a. aggregated. b. detailed. c. regulated. d. unreliable.
54. A distinguishing feature of managerial accounting is a. external users. b. general-purpose reports. c. very detailed reports. d. quarterly and annual reports.
55. What activities and responsibilities are not associated with management's functions? a. Planning b. Accountability c. Controlling d. Directing
56. Planning is a function that involves a. hiring the right people for a particular job. b. coordinating the accounting information system. c. setting goals and objectives for an entity. d. analyzing financial statements.
57. The managerial function of controlling a. is performed only by the controller of a company. b. is only applicable when the company sustains a loss. c. is concerned mainly with operating a manufacturing segment. d. includes performance evaluation by management.
58. Which of the following is not a management function? a. Constraining b. Planning c. Controlling d. Directing
59. A manager that is establishing objectives is performing which management function? a. Controlling b. Directing c. Planning d. Constraining
60. The management function that requires managers to look ahead and establish objectives is a. controlling. b. directing. c. planning. d. constraining.
61. In determining whether planned goals are being met, a manager is performing the function of a. planning. b. follow-up. c. directing. d. controlling.
62. Which of the following is not a separate management function? a. Planning b. Directing c. Decision-making d. Controlling
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