Advanced Managerial Accounting Test Preparation
Course Introduction
Advanced Managerial Accounting delves into the intricate techniques and practices used by managers to make informed business decisions. The course explores topics such as budgeting, cost allocation, performance measurement, variance analysis, and strategic cost management, with an emphasis on leveraging accounting data to drive operational efficiency and support long-term organizational goals. Students will engage with real-world case studies and advanced analytical tools to understand how managerial accounting concepts are applied to complex business scenarios, ensuring they are prepared to address the challenges of dynamic and competitive environments.
Recommended Textbook Managerial Accounting v. 2.1 by Kurt Heisinger and Joe Hoyle
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13 Chapters
876 Verified Questions
876 Flashcards
Source URL: https://quizplus.com/study-set/3576
Page 2
Chapter 1: What Is Managerial Accounting
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75 Verified Questions
75 Flashcards
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Sample Questions
Q1) Enterprise Resource Planning (ERP)systems are only used by large publicly held organizations.
A)True
B)False
Answer: False
Q2) If you compare financial statements prepared in accordance with U.S.GAAP to a managerial accounting report,the managerial accounting report is more likely to:
A)provide financial information for the company as a whole.
B)focus on users of financial information outside the company.
C)provide financial information related to the last accounting period.
D)provide financial information at the product level.
E)None of the above.
Answer: D
Q3) Distinguishing between period and product costs can be done quickly and easily.
A)True
B)False
Answer: False
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Chapter 2: How Is Job Costing Used to Track Production Costs
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44 Verified Questions
44 Flashcards
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Sample Questions
Q1) The Work in Process Inventory account for Baja Manufacturing Company shows a balance of $7,200 at the end of the accounting period.The job cost sheets of the only two uncompleted jobs,Jobs 4 and 7,show respective charges of $2,400 and $1,200 for direct materials used.Jobs 4 and 7 also show respective charges of $1,600 and $800 for direct labor used.Based on this information,what is the predetermined overhead rate as a percentage of direct labor costs that Morris is using?
A)200%
B)50%
C)33.3%
D)16.7%
E)None of the answer choices is correct.
Answer: B
Q2) The journal entry for recording timesheet submissions by employees working on various jobs will include a debit to the Direct Labor account.
A)True
B)False
Answer: False
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4
Chapter 3: How Does an Organization Use Activity-Based
Costing to Allocate Overhead Costs
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70 Verified Questions
70 Flashcards
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Sample Questions
Q1) Which of the following focuses on promoting the efficient use of resources?
A)Reducing quality inspections to minimize allocated quality control department costs.
B)Establishing prices for products.
C)Preparing financial statements for the annual report.
D)Calculating profits for each product so management can decide on which products to promote.
E)None of the answer choices is correct.
Answer: A
Q2) Prevention costs are costs for activities that prevent product defects.
A)True
B)False
Answer: True
Q3) An advantage of using activity-based costing is that it provides detailed information related to production activities.
A)True
B)False
Answer: True
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Page 5
Chapter 4: How Is Process Costing Used to Track
Production Costs
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58 Verified Questions
58 Flashcards
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Sample Questions
Q1) Use the following information to calculate the cost per equivalent unit for direct materials,direct labor,overhead,and in total for the Assembly Department of Dessert Company for the month of June. \(\begin{array}{lccc}
& \text { Direct } & \text { Direct } & \\ & \text { Materials } & \text { Labor } & \text { Overhead } \\ \text { Total costs to be accounted for } & \$ 600,000 & \$ 1,200,000 & \$ 1,800,000 \\ \text { Total equivalent units accounted for } & 30,000 \text { units } & 24,000 \text { units } & 24,000 \text { units } \end{array}\)
Q2) Refer to Exhibit 4-1.What is the cost per equivalent unit for direct labor (rounded to the nearest cent)?
A)$5.28
B)$5.11
C)$4.94
D)$0.86
E)None of the answer choices is correct.
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Page 6
Chapter 5: How Do Organizations Identify Cost Behavior
Patterns
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68 Verified Questions
68 Flashcards
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Sample Questions
Q1) Which of the following costs is typically not a fixed overhead cost for a factory?
A)Salaries of factory supervisors.
B)Rent on the factory building.
C)Property taxes on the factory building.
D)Indirect materials used in production.
E)None of the answer choices is correct.
Q2) Randle Company ran a regression analysis comparing total units of production and maintenance costs for the past four months.The regression analysis shows an R-squared of 0.76.Which of the following statements best describes this measure?
A)76 percent of the total maintenance costs are fixed and 24 percent are variable.
B)76 percent of the variation in maintenance costs is not explained by the increase or decrease in production.
C)76 percent of the variation in maintenance costs is explained by the increase or decrease in production.
D)76 percent of the company's total costs are maintenance costs.
E)None of the answer choices is correct.
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Chapter 6: How Is Cost-Volume-Profit Analysis Used for Decision Making
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79 Verified Questions
79 Flashcards
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Sample Questions
Q1) Absorption costing treats fixed manufacturing overhead costs as product costs.
A)True
B)False
Q2) Operating leverage refers to the level of fixed costs within an organization.
A)True
B)False
Q3) If the number of units produced is more than the number of units sold,which of the following statements is true when comparing overhead costs under absorption versus variable costing?
A)Variable costing will produce higher fixed overhead costs on the income statement.
B)Absorption costing will produce higher fixed overhead costs on the income statement.
C)Overhead costs on the income statement are the same under both methods.
D)Absorption costing will have higher variable overhead costs on the income statement.
E)None of the answer choices is correct.
Q4) Sensitivity analysis is also called "what-if analysis."
A)True
B)False
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Chapter 7: How Are Relevant Revenues and Costs Used to
Make Decisions
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76 Verified Questions
76 Flashcards
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Sample Questions
Q1) In which of the following cases is a customer most likely to be dropped?
A)When the customer's variable costs are more than its total fixed costs.
B)When the customer's avoidable fixed costs are more than its contribution margin.
C)When the customer's total fixed costs are more than its contribution margin.
D)When the customer's contribution margin is more than its avoidable fixed costs.
E)None of the answer choices is correct.
Q2) Refer to Exhibit 7-1.Which of the following amounts is a sunk cost in this problem?
A)$1,060 per unit
B)$40 per unit
C)$600 per unit
D)$400 per unit
E)None of the answer choices is correct.
Q3) A "make-or-buy" decision means a company is deciding whether to build the product or outsource the product.
A)True
B)False
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Chapter 8: How Is Capital Budgeting Used to Make Decisions
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72 Verified Questions
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Sample Questions
Q1) Niwot Inc.is considering an investment that will generate $600,000 in cash inflows per year for 7 years and has $360,000 of cash outflows for the same period (before income taxes).The cost of the asset is $420,000 and it will be depreciated using straight-line depreciation over the 7 year life.The asset has no salvage value.Niwot's tax rate is 30%.The cost of capital is 9%.
Factors: Present Value af an Annuity \(( r = 9 \% )\)
\(\begin{array} { l l } \text { Year 1 } & 0.9174 \\ \text { Year 2 } & 1.7591 \\ \text { Year 3 } & 2.5313 \\ \text { Year 4 } & 3.2397 \\ \text { Year 5 } & 3.8897 \\ \text { Year 6 } & 4.4859 \\ \text { Year 7 } & 50330 \end{array}\)
What is the net present value of this investment (rounded to the nearest dollar)?
A)$516,138
B)$953,400
C)$999,180
D)$485,940
E)None of the answer choices is correct.
Q2) Managers often rank investment opportunities by internal rate of return.
A)True
B)False
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Chapter 9: How Are Operating Budgets Created
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68 Verified Questions
68 Flashcards
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Sample Questions
Q1) Fireside Inc.had sales as follows during 2016: \(\begin{array}{ll}
\text { Quarter 1 } & 15,000 \text { units } \\
\text { Quarter 2 } & 15,500 \text { units } \\
\text { Quarter 3 } & 18,000 \text { units } \\
\text { Quarter 4 } & 16,000 \text { units } \end{array}\)
Fireside expects sales in each quarter of 2013 to be 15% more than the respective quarters for 2016.If each unit sells for $40,what amounts will appear as sales revenue in the quarterly sales budgets for 2013?
A)$690,000;$713,000;$828,000;$736,000
B)$741,750;$741,750;$741,750;$741,750
C)$540,000;$558,000;$648,000;$576,000
D)$600,000;$620,000;$720,000;$640,000
E)None of the answer choices is correct.
Q2) Sales personnel who are paid a bonus for exceeding budgeted sales have an incentive to underestimate sales when establishing the sales budget.
A)True
B)False
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11
Chapter 10: How Do Managers Evaluate Performance Using Cost Variance Analysis
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69 Verified Questions
69 Flashcards
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Sample Questions
Q1) Standard cost typically refers to costs per unit for direct materials,direct labor,and variable overhead.
A)True
B)False
Q2) Colfax Company incurred production labor costs of $5,400 in February (payable in March)for work requiring 1,100 standard hours at a standard rate of $15 per hour;1,200 actual direct labor hours were worked.Based on this information,which one of the following would be included in the journal entry to record the labor costs?
A)$16,500 credit to Work-in-process Inventory.
B)$1,500 credit to Labor Efficiency Variance.
C)$16,200 credit to Wages Payable.
D)$1,500 credit to Labor Rate Variance.
E)None of the answer choices is correct.
Q3) Management by exception is a term used to describe managers who focus solely on variances that are significant.
A)True
B)False
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Page 12
Chapter 11: How Do Managers Evaluate Performance in
Decentralized Organizations
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63 Verified Questions
63 Flashcards
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Sample Questions
Q1) Refer to Exhibit 11-1.Assume the Trikes Division has average operating assets totaling $400,000 for the year.What is the division's return on investment?
A)19.2%
B)40.0%
C)90.0%
D)24.0%
E)None of the answer choices is correct.
Q2) A cost center is an organizational segment in which the manager is responsible for costs and revenues,but not investments in assets.
A)True
B)False
Q3) Although economic value added (EVA)is similar to residual income,adjustments are made to the financial information to better reflect the economic results of the division.
A)True
B)False
Q4) Segments of an organization are often referred to as divisions.
A)True
B)False
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Chapter 12: How Is the Statement of Cash Flows Prepared and Used
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65 Verified Questions
65 Flashcards
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Sample Questions
Q1) Refer to Exhibit 12-5.How will the change in inventory be reported in the operating activities section of the statement of cash flows?
A)The increase of $50,000 will be added to cost of goods sold.
B)The increase of $50,000 will be added to net income.
C)The increase of $50,000 will be subtracted from net income.
D)The increase of $50,000 will be subtracted from cost of goods sold.
E)None of the answer choices is correct.
Q2) When preparing the operating activities section of the statement of cash flows using the indirect method,increases in current assets are added to net income.
A)True
B)False
Q3) When using the indirect method,losses related to investing activities are adjusted by adding them to net income in the operating activities section of the statement of cash flows.
A)True
B)False
Q4) Operating cash flow ratios are always greater than 1.0.
A)True
B)False
Page 14
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Chapter 13: How Do Managers Use Financial and
Nonfinancial Performance Measures
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62 Verified Questions
62 Flashcards
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Sample Questions
Q1) Companies with higher inventory turnover ratios tend to have lower inventory costs,including lower inventory storage and insurance costs,than companies with lower inventory turnover ratios.
A)True
B)False
Q2) The quick ratio is a short-term liquidity ratio.
A)True
B)False
Q3) Return on assets is calculated as average total assets divided by net income. A)True
B)False
Q4) Refer to Exhibit 13-1.What is the debt to assets ratio for 2017 (rounded to two decimal places)?
A)0.30
B)0.50
C)2.00
D)1.00
E)None of the answer choices is correct.
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