MANAGERIAL ACCOUNTING - General Concepts

(Practice Quizzers)

1. All of the following pertains to the planning function of management, except;

a. It requires management to look ahead and establish objectives
b. Formulating the corporate strategy
c. Having a detailed look at the current external and internal business environment.
d. Obtaining feedback
2. Which of the following are least likely to be done by management on a day-to-day basis?
a. Constantly reminding personnel about their self-worth and the importance of their duties
and responsibilities
b. Mobilize people to carry out the plans and overseeing daily activities of the company
c. Regulation of business activities in accordance with a plan so that the objectives of the
company will be attained.
d. None of the above
3. The following tasks are usually performed by managers during the controlling phase, except;
a. The process of keeping the company's activities on track
b. Construction of a budget
c. Construction of a performance-variance analysis report
d. None of the above
4. Among the management accounting concepts is controllability which means;
a. It is necessary at all times to identify the responsibilities and key result areas of the
individuals within the organization.
b. Management accounting must ensure that flexibility is maintained in assembling and
interpreting information.
c. Management accounting identified elements or activities which management can or
cannot influence, and seeks to arrest risks and sensitivity factors.
d. Accounting information must be of such quality that confidence can be placed in it.
5. Management accounting is an integral part of the management process. As such it provides
essential information for the following objectives except:
a. Maintaining the current level of resource utilization as well as internal and external
communication.
b. Measuring and evaluating performance
c. Planning strategies and controlling current activities of the organization.
d. Enhancing objectivity in decision making.
6. Generally, management accounting involves the following functions except;
a. Assist management in determining policies and in making plans
b. Assist management in tracing the taxes to be paid with the government
c. Assist management in the planning, directing, coordinating and controlling of
operations
d. Maintain records and procedures which will be adequately protect all the interest related
to the business
7. The day-to-day work of management teams will typically comprise all of the following
activities except:
a. decision making.
b. planning.
c. cost minimizing.
d. directing operational activities.
8. Taurus Company has set various goals, and management is now taking appropriate action to
ensure that the firm achieves these goals. One such action is to reduce outlays for overhead,
which have exceeded budgeted amounts. Which of the following functions best describes
this process?
a. Decision making.
b. Planning.
c. Coordinating.
d. Controlling.
9. All of the following pertains to Financial Accounting rather than Managerial Accounting,
except:
 a. Reports are provided outside the organization – external reports
b. Reports past activities – based on a historical perspective
c. Summarized data for entire company as a whole
d. Provides information to make decisions regarding the future
10. Managerial accounting differs from financial accounting in a number of aspects, which of the
following does not pertain to the characteristics of management accounting information:
a. Does not follow GAAP and there are no reporting regulations
b. Focuses on timeliness of information
c. Reporting is focused on parts of the organization such as departments or divisions and
not on the organization as a whole.
d. Focus on precise information since they are used outside the company
11. Which of the following will least likely pertain to management accounting?
a. Prepares reports only for management’s internal use
b. Relevance of data is emphasized over reliability
c. Must follow GAAP which has specific required external reports
d. Nothing is required to be reported, reports what management needs to see
12. Which of the following does not apply to the content of managerial reports?
a. Reporting standard is relevance to the decision being made.
b. May extend beyond double-entry accounting system.
c. Pertains to subunits of the business and may be very detailed.
d. Pertains to the business as a whole and is highly aggregated.
13. Managerial accounting is similar to financial accounting in that
a. both are governed by generally accepted accounting principles.
b. both deal with economic events.
c. both concentrate on historical costs.
d. both classify reported information in the same way.
14. One of the ways managerial accounting differs from financial accounting is that managerial
accounting
a. is bound by generally accepted accounting principles.
b. classifies information in different ways.
c. does not use financial statements.
d. deals only with economic events.
15. Which of the following statements represents a similarity between financial and managerial
accounting?
a. Both are useful in providing information for external users.
b. Both are governed by GAAP.
c. Both draw upon data from an organization's accounting system.
d. Both rely heavily on published financial statements.
16. All of the following will be under the responsibility of the controller except:
a. Responsible for the maintenance of adequate internal control
b. Preparation of accounting records
c. Planning and controlling the company cash position
d. None of the above
17. If you are appointed as the treasurer of a corporation, which of the following will least likely
be part of your responsibilities?
a. Custody of the company funds
b. Responsibility for relations with the company's financial institutions and major creditors
c. Responsible for the preparation of budget and performance evaluation report.
d. Obtains and manages the corporation`s capital
18. Mr. Jay Cruz has recently been hired as the controller of Calapan Corporation. One of the
responsibilities that Mr. Cruz will perform will include;
a. Preparation of tax returns, the annual report, and Securities and Exchange
Commission (SEC) filing.
b. Managing corporate assets
c. Planning the finances and capital expenditures
d. Investor relations
19. The treasurer of a company is usually responsible for all of the following, except:
a. Managing the investment portfolio
b. Receiving and recording requests for disbursements
 c. Formulating credit policy
d. None of the above
20. All of the following describes the characteristics of a controller’s responsibility, except:
a. Interpretation of financial data
b. Appraisal of results of operation and making Recommendations
c. Usually looks at what has occurred rather than what should or will happen.
d. Emphasizes cash flow
21. Which of the following are least likely to be a staff position?
a. Vice President for Human Resources and Development
b. Vice President for Government Relations
c. Logistics Area Manager
d. Executive Assistant to the President
22. The following positions are considered to have a staff authority, which is the exception?
a. Controller for a manufacturer
b. Corporate Legal Counsel of a Manufacturer
c. Product Manager of diversified company
d. Human Resource Manager of a Utility Company
23. All of the following are considered to have line authority, except:
a. Vice President for Plant Operation
b. Vice President for Sales of a Computer Manufacturer
c. Director for research and development of a technology-based corporation
d. None of the above
24. Which of the following employees would be considered as holding a line position?
a. Exxon Corporation's vice-president for government relations.
b. The controller of General Motors.
c. A secretary employed by Verizon Communications.
d. The manager of food and beverage services at Disney's Magic Kingdom.
25. Which of the following employees at Starbucks would likely be considered as holding a staff
position?
a. The company's chief operating officer (COO).
b. The company's lead, in-house attorney.
c. The company's chief financial officer (CFO).
d. Choices "b" and "c" above.
26. Primary processes in the value chain are comprised of
a. Marketing, legal and accounting services.
b. Research and development, marketing, supply, design, production, distribution, and
information systems.
c. Research and development, design, supply, production, marketing, distribution and
customer service.
d. Human resources, legal services, information systems and management accounting.
27. Which one is not an element in the primary activities of a value chain?
a. Procurement
b. Inbound Logistics
c. Outbound Logistics
d. Service
28. Which of the following is least likely an element of integrity?
a. Communicate information fairly and objectively
b. Refrain from engaging in any conduct that would prejudice carrying out duties
ethically.
c. Mitigate actual conflicts of interest
d. Regularly communicate with business associates to avoid apparent conflicts of
interest.
29. All of the following is considered to be an element of Credibility, except:
a. Communicate information fairly and objectively
b. Disclose all information that would reasonably be expected to influence an intended
user’s understanding of the reports, analyses, or recommendation.
c. Inform all relevant parties regarding appropriate use of information.
d. None of the above
30. Which of the following is most likely an element of Competence?
a. Refrain from using information for unethical or illegal advantage
b. Communicate information fairly and objectively
c. Mitigate actual conflicts of interest
d. Perform professional duties in accordance with relevant laws, regulations and technical
standards
31. Which of the following will most likely be considered as an element of Confidentiality?
a. Maintain an appropriate level of professional expertise continually developing
knowledge and skills
b. Provide decision support information and recommendation that are accurate, clear,
concise and timely.
c. Keep information from other parties except when disclosure is authorized or legally
required.
d. Both a and b is correct
32. Assume that a managerial accountant regularly communicates with business associates to
avoid conflicts of interest and advises relevant parties of potential conflicts. In so doing, the
accountant will have applied the ethical standard of:
a. objectivity.
b. confidentiality.
c. integrity.
d. credibility.
33. According to IMA of Ethical Professional Practice, what should a management accountant do if
a significant ethical situation can't be resolved?
a. The accountant should try to rationalize and understand the position of the other party.
b. The accountant should say nothing about the matter until he or she has retired.
c. The accountant should confront the guilty party and demand the unethical action be
stopped.
d. The accountant should first discuss the matter with the immediate supervisor.
34. Which of the following are associated with Planning?
a. Specifies the resources needed to achieve the company goals
b. Communicates a company's goals to employees
c. Evaluating managers to determine how their performance should be rewarded or
punished
d. Evaluating operations to provide information as to whether they should be changed or
not
35. Which of the following is associated with Controlling?
a. Specifies the resources needed to achieve the company goals
b. communicates a company's goals to employees
c. Evaluating managers to determine how their performance should be rewarded or
punished
d. Evaluating operations to provide information as to whether they should be changed or
not
36. Which of the following is part of planning?
a. Departmental performance report.
b. Incremental analysis
c. Cash-flow budget
d. Management by exception
37. A management function that measures performance against objectives, determining causes
of deviations and taking necessary corrective action
a. Organizing
b. Planning
c. Motivating
d. Controlling
38. Which function is most directly related to management by objectives?
a. Planning
b. Control
c. Decision making
 d. Reporting.
39. Planning and control are
a. different names for the same thing
b. the basic functions of management
c. described equally well by the terms "decision making" and "performance evaluation.”
d. exemplified by, respectively, financial statements and budgeting.
40. The process of ensuring that a firm’s operating results are proceeding according to plan is
known as
a. Organizing
b. Planning
c. Directing
d. Controlling
41. The unit of measurement used in management accounting is
a. primarily the historical peso.
b. usually current replacement cost.
c. any measurement unit that is useful in a particular situation.
d. the measurement unit used by competing companies.
42. In comparing management accounting with financial accounting, which of the following
statements is true?
a. Both use historical costs as their primary unit of measurement.
b. Both depend on the double-entry system of accounting.
c. Both require adherence to GAAP.
d. Financial accounting reports are more objective, whereas management accounting
reports are more subjective.
43. The two dimensions of managerial accounting are:
a. a decision-facilitating dimension and a decision-influencing dimension.
b. a decision-facilitating dimension and a financial-influencing dimension.
c. a decision-influencing dimension and a cost-minimizing dimension.
d. a cost-minimizing dimension and a profit-maximizing dimension.
44. What statement about management accounting is FALSE?
a. Management accounting helps managers fulfill organizational objectives.
b. Management accounting is used by managerial accountants to make strategic and
operational decisions.
c. Management accounting is the process of identifying, measuring, accumulating,
analyzing, preparing, interpreting and communicating information.
d. Management accounting produces information for managers in an organization
45. Which of the following is not true?
a. managerial accounting information is prepared for internal users
b. managerial accounting information is not required by various laws
c. there are specific standards of acceptability for managerial accounting
d. the structure of managerial accounting practice is relatively flexible
46. The use of management accounting is
a. Optional
b. Compulsory
c. Legally obligatory
d. Compulsory to some and optional to others
47. Which least likely to be true about Managerial Accounting?
a. Presents very detailed information
b. Presents only monetary information
c. Places emphasis on future
d. None of the above
48. Which of the following is not an objective of managerial accounting?
a. Providing information for decision making and planning.
b. Assisting in directing and controlling operations.
c. Maximizing profits and minimizing costs.
d. Measuring the performance of managers and subunits.
49. Managerial accounting:
a. is unregulated.
b. produces information that is useful only for manufacturing organizations.
 c. is based exclusively on historical data.
d. is regulated by the Securities and Exchange Commission (SEC).
50. Financial accounting focuses primarily on reporting:
a. to parties outside of an organization.
b. to parties within an organization.
c. to an organization's board of directors.
d. to financial institutions.
51. Which of the following characteristic(s) relate(s) more to managerial accounting than to
financial accounting?
a. A focus on reporting to external parties.
b. An area of accounting that is heavily regulated.
c. A focus on providing information that is relevant for planning, decision making,
directing, and control.
d. None of the above
52. When comparing management accounting and financial accounting, which of the following
statements is FALSE?
a. Behavioral considerations are of primary importance in management accounting, but
not in financial accounting.
b. Management accountants are constrained by the principles of reporting promulgated
by the Institute of Management Accountants whereas financial accountants are
constrained by Generally Accepted Accounting Principles.
c. Management accounting has a future orientation whereas financial accounting has a
past orientation.
d. Management accounting prepares detailed reports whereas financial accounting
prepares summary reports
53. Which of the following typically does not relate to the role of a controller?
a. A controller supervises the accounting department.
b. A controller safeguards an organization's assets.
c. A controller oversees the preparation of reports required by governmental authorities.
d. None of the above
54. The controller of a company or other organization is
a. a staff manager
b. an operating manager
c. an accountant, not a manager
d. a natural manager.
55. The functions of planning for control, evaluating and consulting, and governmental reporting
are typically assumed within organizations by:
a. the company treasurer
b. the company controller
c. the company vice-president of marketing
d. external auditors
56. The treasurer function includes:
a. tax administration
b. evaluating and consulting
c. economic appraisal
d. None of the above
57. You were newly appointed as controller of CZX Corporation. Among the jobs your
department would do include the following:
a. cash receipts, cash disbursements, general accounting, taxation, financial accounting
analysis, and internal auditing.
b. financial reporting, strategic planning, managerial accounting, taxation, financial
statement analysis, and internal accounting.
c. financial accounting, managerial accounting, cost accounting, inventory accounting,
payroll accounting, tax accounting, and sales forecasting.
d. tax accounting, internal accounting, internal auditing, and general accounting.
58. Which of the following employees at Delta Airlines would not be considered as holding a line
position?
a. Pilot.
b. Chief financial officer (CFO).
 c. Flight attendant.
d. Ticket agent.
59. All of the following are staff personnel except:
a. production supervisor.
b. cost accountant.
c. corporate controller.
d. Maintenance supervisor
60. A position to which decision-making authority has been delegated within the chain of
command from senior managers to front line production or service employees is called.
a. line position.
b. staff position.
c. Both a and b
d. None of the above
61. For a hospital, which of the following positions will most likely be classified as a staff position?
a. Emergency Room Manager
b. Human Resources Manager
c. Head Nurse
d. None of the above
62. In a technology company, which department/s will most likely be classified as line position?
a. Building Maintenance Department
b. Accounting Department
c. Research and Development Department
d. None of the above
63. The IMA Code of Ethics requires a management accountant to follow the established policies
of the organization when facing an ethical conflict. When management accountants fail to
resolve an ethical conflict by talking with their immediate supervisor, they should
a. communicate the problem to authorities outside the organization.
b. contact the next higher managerial level.
c. notify the audit committee of the board of directors.
d. contact the chief financial officer.
64. To determine whether a particular action is professionally ethical or not, using the Institute of
Management Accountants Statement of Ethical Professional Practice, it is necessary to know:
a. whether the act is legal in your jurisdiction.
b. the intent and the business context of the act.
c. the amount of the fraud or theft that is involved.
d. whether the management accountant is certified.
65. Under which ethical standard of conduct does the managerial accountant have the
responsibility to disclose fully all relevant information that could reasonably be expected to
influence an intended user's understanding of the reports, comments, and recommendations
presented?
a. Credibility
b. confidentiality
c. competence
d. integrity