Accounting for Managers
Exam Materials
Course Introduction
Accounting for Managers is designed to equip future business leaders with essential knowledge of accounting principles and practices relevant to managerial decision-making. The course covers the interpretation and analysis of financial statements, budgeting, cost-volume-profit analysis, performance measurement, and the use of accounting information to plan, control, and evaluate organizational activities. Emphasis is placed on practical applications in various business contexts, enabling managers to make informed financial decisions, understand the implications of accounting data, and communicate effectively with stakeholders about financial matters.
Recommended Textbook
Intermediate Accounting 6th Edition Volume 2 by Thomas H. Beechy
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11 Chapters
1425 Verified Questions
1425 Flashcards
Source URL: https://quizplus.com/study-set/2889
Page 2
Chapter 1: The Framework for Financial Reporting
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69 Verified Questions
69 Flashcards
Source URL: https://quizplus.com/quiz/57522
Sample Questions
Q1) A firm sold $100,000 worth of goods during 2014.The firm extends warranty coverage on these goods.Historically,warranty costs have averaged 2% of total sales.During 2014,the firm incurred $1,000 to service goods sold in 2013 and $200 to service goods sold in 2014.What is warranty expense for 2014?
A) $200
B) $1,200
C) $2,000
D) $3,200
Answer: C
Q2) Contingencies must be both accrued and disclosed.
A)True
B)False
Answer: False
Q3) Accounts payable should include only obligations directly related to the primary and continuing operations of an entity.
A)True
B)False
Answer: True
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3
Chapter 2: Accounting Judgements
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77 Verified Questions
77 Flashcards
Source URL: https://quizplus.com/quiz/57521
Sample Questions
Q1) When the interest payment dates of a bond are May 31 and November 30,and a bond issue is sold on July 1,the price of the bond will be:
A) Decreased by accrued interest from July 1 to November 30.
B) Decreased by accrued interest from May 31 to July 1.
C) Increased by accrued interest from May 31 to July 1.
D) Increased by accrued interest from July 1 to November 30.
E) Unaffected by accrued interest.
Answer: E
Q2) All of the following are true with respect to sinking funds except:
A) A sinking fund is a cash fund that is restricted for retiring the debt of a company.
B) A sinking fund may be handled by a trustee or by the individual company.
C) A sinking fund may make the investment more attractive to investors.
D) Once the sinking fund is established, the company has no more responsibility to the debt.
Answer: D
Q3) Hedging is one method of minimizing foreign exchange risk.
A)True
B)False
Answer: True
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Page 4
Chapter 3: Statements of Income and Comprehensive Income
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168 Verified Questions
168 Flashcards
Source URL: https://quizplus.com/quiz/57520
Sample Questions
Q1) As of January 1,2013 there are 2 years of dividends in arrears on an issue of cumulative nonconvertible preferred shares.No dividends on preferred shares were declared in 2013.Therefore,under IFRS,on the Dec.31,2013 financial statements,the firm issuing the preferred shares:
A) Reports a liability equal to 3 years of dividends on preferred shares
B) Reports a liability equal to 2 years of dividends on preferred shares
C) Subtracts 2 years of dividends on preferred shares from earnings when computing earnings per share for 2013
D) Discloses in a footnote to 2013's balance sheet that there are 3 years of dividends on preferred shares in arrears
E) Discloses in a footnote to 2013's balance sheet that there are 2 years of dividends on preferred shares in arrears
Answer: D
Q2) Total retained earnings include both appropriated and unappropriated retained earnings.
A)True
B)False
Answer: True
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Chapter 4: Statements of Financial Position and Changes in Equity; Disclosure Notes
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127 Verified Questions
127 Flashcards
Source URL: https://quizplus.com/quiz/57519
Sample Questions
Q1) On January 1,2014,ABC Incorporated issued $10,000,000 face amount of 8%,10 year,subordinated convertible debentures at face value in a private placement.The debentures pay interest annually,in cash,on 31 December.The bonds are convertible into 50 common shares for each $1,000 of the bonds' face value.
Part A: Prepare Journal entries to record the issuance of the bonds on January 1,2014.Assume that the principal will not be repaid.Instead,shares will be issued to the holders of the debentures in addition to the cash interest paid.In other words,conversion is deemed to be mandatory.
Part B: Prepare Journal entry to record the interest payment on the first interest date of 31 December 2014.Also record the related equity transfer.
Q2) Options are ONLY for the purpose of buying or selling financial instruments.
A)True
B)False
Q3) On the statement of cash flows,a hybrid financial instrument should be:
A) Reported as an operating activity
B) Reported as a financial activity
C) Reported as an investing activity
D) Reported according to its individual components
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Chapter 5: The Statement of Cash Flows
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116 Verified Questions
116 Flashcards
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Sample Questions
Q1) Which of the following is an example of a temporary difference,which would result in a deferred tax asset?
A) Use of straight-line depreciation for accounting purposes and an accelerated rate for income tax purposes
B) Rent revenue collected in advance when included in taxable income before it is included in pre-tax accounting income
C) Use of a shorter depreciation period for accounting purposes than is used for income tax purposes
D) Investment losses recognized later for accounting purposes than for tax purposes
Q2) Golf dues paid for by a company are:
A) a temporary difference
B) a timing difference
C) a permanent difference
D) a reversing difference
Q3) What term is used to describe an amount that will eventually be tax deductible?
Q4) Deferred taxes may be classified as either current or non-current under IFRS.
A)True
B)False
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Chapter 6: Revenue Recognition
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98 Verified Questions
98 Flashcards
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Sample Questions
Q1) Better matching is achieved when deferred income tax assets due to carry forwards are fully recognized in the year of the loss.
A)True B)False
Q2) Existing sufficient taxable temporary differences,which will result in taxable income,is one piece of evidence to support a more likely than not criteria.
A)True
B)False
Q3) How does the existence of a loss in the year impact the accounting of temporary differences?
Q4) Once it is deemed that a potential benefit of a loss carry forward does not meet the more likely than not criteria,the benefit may not be recognized.
A)True B)False
Q5) Companies normally apply tax loss carry backs sequentially. A)True B)False
Q6) Describe the difference between a tax loss and a tax benefit.
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Chapter 7: Financial Assets: Cash and Receivables
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227 Verified Questions
227 Flashcards
Source URL: https://quizplus.com/quiz/57516
Sample Questions
Q1) Assume the following facts relating to a lease: Leased asset,new at inception of lease term.
Estimated useful life,14 years.
Lease term,8 years; asset returns to lessor.
Interest rate implicit in the lease,10 percent (known by lessee).
Lessee's marginal borrowing rate,12 percent.
Amount of each lease payment,$2,000.
Lessor's cost of the leased asset,$15,164.
Market value of leased asset at inception of the lease term,$15,164
Lease payments are due at the end of each period.
From the perspective of the lessee,this lease should be classified as a(n):
A) sales-type lease.
B) direct financing lease.
C) operating lease.
D) finance lease.
Q2) In a sale and leaseback arrangement,the lessee is also:
A) the new owner of the property
B) the seller
C) the buyer
D) a third party guarantor
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Page 9
Chapter 8: Cost-Based Inventories and Cost of Sales
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93 Verified Questions
93 Flashcards
Source URL: https://quizplus.com/quiz/57515
Sample Questions
Q1) ABC has a non-contributory,defined benefit pension plan.Data for 2014 were as follows: Pension plan assets (at fair value)January 1,2014,$240,000,and December 31,2014,$285,000; APO,January 1,2014,$243,000 and December 31,2014,$345,000.The accrued pension obligation was underfunded at the end of 2014 in the amount of:
A) $15,000.
B) $30,000.
C) $45,000.
D) $60,000.
Q2) The accumulated benefit and projected unit credit methods both result in increasing employer contributions to the pension plan over time.
A)True
B)False
Q3) In accounting for pension costs,any difference between current year's pension expense and contribution into the pension trust should be reported as a(n):
A) offset to pension plan assets.
B) accrued actuarial liability.
C) deferred pension liability/cost.
D) operating expense of the current period.
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Chapter 9: Long-Lived Assets
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134 Verified Questions
134 Flashcards
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Sample Questions
Q1) EPS figures must be disclosed on the face of the financial statements for discontinued operations.
A)True
B)False
Q2) In some cases,diluted earnings per share amounts may be the same as the basic earnings per share amounts.
A)True
B)False
Q3) Basic EPS is an historical amount.
A)True
B)False
Q4) Options are in-the-money if the exercise price is higher that the market value of common shares.
A)True
B)False
Q5) Nonconvertible,cumulative,preferred shares affect the computation of EPS (for a simple capital structure),basic EPS,but not diluted EPS.
A)True
B)False
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Chapter 10: Depreciation, Amortization, and Impairment
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154 Verified Questions
154 Flashcards
Source URL: https://quizplus.com/quiz/57513
Sample Questions
Q1) An asset cost $12,000 when acquired and had an estimated useful life of 10 years with no estimated residual value.Use straight-line depreciation.During Year 7,the overall life was changed to 12 years.
(a)What should be recorded as depreciation expense for Year 7?
$_________________________.
(b)What would the balance of accumulated depreciation be at the start of Year 8?
$______________________________
(c)Would a correCt.ing entry be made during Year 7 for the change?
Yes ____________ No ______________ Explain why._______________
Q2) Which of the following should not be reported retrospectively?
A) Use of an unacceptable accounting principle, then changing to an acceptable accounting principle
B) Correction of an overstatement of ending inventory two years ago
C) Use of an unrealistic accounting estimate, then changing to a realistic estimate
D) Change from a good faith but erroneous estimate to a new estimate
Q3) Accounting policy changes must always be handled retrospectively.
A)True
B)False
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12
Chapter 11: Financial Instruments: Investments in Bonds and Equity Securities
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162 Verified Questions
162 Flashcards
Source URL: https://quizplus.com/quiz/57512
Sample Questions
Q1) The rule of thumb for the current ratio is 2:1.When would a current ratio below this threshold not necessarily be a concern for a company?
A) When accounts receivable balances are high
B) When cash flows are steady and reliable
C) When inventories are high
D) None of these choices are correct
Q2) The amount of working capital would not be affected by which of the following transactions?
A) Sale of long-term investments for cash at a loss
B) Transfer of a long-term investment for cash
C) Issuance of a long-term note in exchange for cash
D) Issuance of common shares of the corporation in exchange for noncurrent assets
E) All of these choices would affect working capital
Q3) An adverse opinion is given if the auditor disagrees with the company on decisions made.This is generally not a serious condition as it relates only to a difference of opinion.
A)True
B)False
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Page 13