Introduction to Managerial Accounting Review Questions
Course Introduction
Introduction to Managerial Accounting provides students with a foundational understanding of how accounting information supports management decision-making processes. The course covers key concepts such as cost behavior, budgeting, performance evaluation, and the use of accounting data for planning and controlling organizational activities. Students learn how managers analyze and interpret financial information to formulate strategies, allocate resources, and optimize operational efficiency. Practical applications and case studies help illustrate how managerial accounting tools are essential for both short-term and long-term business success.
Recommended Textbook
Cornerstones of Managerial Accounting 3rd Canadian Edition by Maryanne Mowen
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14 Chapters
2190 Verified Questions
2190 Flashcards
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Page 2
Chapter 1: Introduction to Managerial Accounting
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66 Verified Questions
66 Flashcards
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Sample Questions
Q1) With which of the following do virtually all managerial accounting practices assist managers?
A)maximizing profits
B)determining costs
C)creating annual reports
D)generating tax reports
Answer: A
Q2) Management accounting information is used only by manufacturing organizations.
A)True
B)False Answer: False
Q3) The process of choosing among competing alternatives is decision making.
A)True
B)False
Answer: True
Q4) Financial accounting has its emphasis on the future.
A)True
B)False Answer: False
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Chapter 2: Basic Managerial Accounting Concepts
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222 Verified Questions
222 Flashcards
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Sample Questions
Q1) Factory security costs
A)Product cost
B)Period cost
Answer: A
Q2) Gross margin period costs
A)Gross margin
B)Selling expenses
C)Sales revenue
D)Cost of goods sold
E)Operating income
Answer: E
Q3) What is one of the main purposes of assigning costs to cost objects?
A)It provides information on why money was spent.
B)It records the historical events of the organization.
C)It allows management to incorporate products in marketing.
D)It facilitates service businesses in following financial regulations.
Answer: A
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Chapter 3: Cost Behaviour
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222 Verified Questions
222 Flashcards
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Sample Questions
Q1) Fixed costs are costs that vary in total within the relevant range as the level of output increases or decreases.
A)True
B)False
Answer: False
Q2) Cost of tires
A)Variable
B)Fixed
Answer: A
Q3) What is an attribute of the scattergraph method?
A)allows a cost analyst to inspect data visually
B)uses only the high and low points
C)does not reveal the presence of outliers
D)is complex and time consuming
Answer: A
Q4) Internet advertising
A)Discretionary
B)Committed
Answer: A
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Chapter 4: Costvolumeprofit Analysis: a Managerial Planning Tool
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161 Verified Questions
161 Flashcards
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Sample Questions
Q1) Refer to the Figure.What is the contribution margin ratio?
A)36%
B)40%
C)44%
D)50%
Q2) What is the ratio of fixed expenses to the contribution margin ratio?
A)the break-even point in sales
B)the break-even point in units
C)the variable cost ratio
D)the margin of safety
Q3) Measured in units sold
A)horizontal-axis of CVP graph
B)vertical-axis of CVP graph
C)slope of revenue line
D)slope of cost line
E)point where the total revenue line and the total cost line intersect
Q4) The break-even point in sales dollars is equal to the break-even units multiplied by the variable cost per unit.
A)True
B)False
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Chapter 5: Job-Order Costing
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177 Flashcards
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Sample Questions
Q1) Form that asks for the type,quantity,and unit price of direct materials
A)Job-order cost sheet
B)Time ticket
C)Materials requisition form
Q2) For which of the following are time tickets filled out?
A)indirect labourers
B)direct labourers
C)managers
D)supervisors
Q3) Process costing is used for manufacturing and service firms producing unique products or services.
A)True
B)False
Q4) Refer to the Figure.Suppose Blackfoot decides to continue using departmental overhead rates.What are the predetermined rates for the assembly and testing departments,respectively?
A)assembly: $4 per direct labour hour; testing: $2 per machine hour
B)assembly: $2 per direct labour hour; testing: $4 per machine hour
C)assembly: $4 per direct labour hour; testing: $4 per direct labour hour
D)assembly: $7.22 per machine hour; testing: $7.22 per machine hour
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Chapter 6: Process Costing
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157 Verified Questions
157 Flashcards
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Sample Questions
Q1) Which account do the costs of completed products move to after work-in-process?
A)sales
B)finished goods
C)completed goods
D)cost of goods sold
Q2) Which two methods determine the equivalent units of production in process costing?
A)weighted average and FIFO
B)FIFO and LIFO
C)actual costing and LIFO
D)weighted average and actual costing
Q3) Physical flow analysis
A)Step 1 in preparing a Production Report
B)Step 2 in preparing a Production Report
C)Step 3 in preparing a Production Report
D)Step 4 in preparing a Production Report
E)Step 5 in preparing a Production Report
Q4) Transferred-in costs are a type of raw material cost.
A)True
B)False
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Chapter 7: Activity-Based Costing and Management
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154 Verified Questions
154 Flashcards
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Sample Questions
Q1) What is the term for the time required to produce one unit of a product?
A)efficiency
B)velocity
C)speed
D)cycle time
Q2) What is the term for the identification and removal of activities that fail to add value?
A)activity selection
B)activity stabilization
C)activity reduction
D)activity elimination
Q3) Product diversity means that products consume overhead activities in systematically similar proportions.
A)True
B)False
Q4) Refer to the Figure.What is the activity rate for processing sales orders?
A)$1.47 per order
B)$182.00 per order
C)$625.00 per order
D)$667.00 per order
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Chapter 8: Absorption and Variable Costing, and Inventory Management
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97 Verified Questions
97 Flashcards
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Sample Questions
Q1) What costs do the ordering costs become when the economic order quantity (EOQ)model is applied to units produced within the company?
A)setup costs
B)stockout costs
C)carrying costs
D)safety-stock costs
Q2) Variable selling expense
A)Variable costing income statement
B)Absorption costing income statement
C)Both types of income statements
Q3) Fixed factory overhead for units sold
A)Variable costing income statement
B)Absorption costing income statement
C)Both types of income statements
Q4) JIT relies on a push system to control finished goods inventory.
A)True B)False
Q5) Total inventory-related cost consists of ordering cost and carrying cost. A)True B)False
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Chapter 9: Budgeting, production, cash, and Master Budget
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165 Verified Questions
165 Flashcards
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Sample Questions
Q1) Refer to the Figure.What is the direct labour cost budgeted for June?
A)$20,000
B)$40,000
C)$150,000
D)$450,000
Q2) Ideally,managers are held accountable for controllable costs.
A)True
B)False
Q3) Cash budgets are often prepared monthly or even weekly.
A)True
B)False
Q4) What is the formula to compute the units to be produced?
A)units produced = units sold
B)units produced = units sold + units in beginning inventory + units in ending inventory
C)units produced = units sold + units in beginning inventory units in ending inventory
D)units produced = units sold units in beginning inventory + units in ending inventory
Q5) Does a not-for-profit agency need to budget? Why or why not?
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11
Chapter 10: Standard Costing: a Managerial Control Tool
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173 Verified Questions
173 Flashcards
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Sample Questions
Q1) Which of the following are sources of quantity standards?
A)historical experience
B)budget studies
C)input from interested personnel
D)benchmarks
Q2) In kaizen costing,each period's Kaizen standard is based on prior periods' improvement,thereby locking in these improvements.
A)True
B)False
Q3) The quantity of each input that should be used to produce one unit of output is documented on the standard cost sheet.
A)True
B)False
Q4) Refer to the Figure.What are the materials price variance and the materials usage variance,respectively?
A)$9,000 U and $1,200 F
B)$9,000 F and $1,200 U
C)$9,300 U and $1,500 F
D)$9,300 F and $1,500 U
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Chapter 11: Flexible Budgets and Overhead Analysis
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149 Verified Questions
149 Flashcards
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Sample Questions
Q1) Refer to the Figure.What is the fixed overhead spending variance?
A)$0
B)$28,000 U
C)$28,000 F
D)$32,000 U
Q2) Activity-based budgeting assumes that activity cost varies with units of product.
A)True
B)False
Q3) Which two costs are compared in a performance report that uses activity flexible budgeting?
A)budgeted costs for actual activity-usage levels and the actual activity costs
B)actual activity costs and budgeted overhead costs
C)actual overhead costs and the budgeted activity costs for actual activity-usage levels
D)static activity budget costs and the budgeted activity costs for the actual activity-usage levels
Q4) Discuss why activity-based flexible budgeting provide a more accurate prediction of costs than a traditional flexible budget.
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13
Chapter 12: Performance Evaluation and Decentralization
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Sample Questions
Q1) In terms of operating income for the company as a whole,the transfer price set by the buying and selling divisions nets out.
A)True
B)False
Q2) Refer to the Figure.Assume that Sophistosand and Videostuff have agreed on a transfer price of $2.20.What are the total cost savings for Videostuff?
A)$18,000
B)$63,000
C)$69,000
D)$81,000
Q3) Which Balanced Scorecard perspective details the economic consequences of actions taken in the other three perspectives?
A)the customer perspective
B)the process perspective
C)the learning and growth perspective
D)the financial perspective
Q4) How is EVA (economic value added)different from standard residual income calculations?
Q5) What is Strategy?
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Chapter 13: Short-Run Decision Making: Relevant Costing
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149 Flashcards
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Sample Questions
Q1) Which of the following is an important qualitative factor to consider regarding a special order?
A)variable costs associated with the special order
B)avoidable fixed costs associated with the special order
C)the effect the sale of special-order units will have on the sale of regularly priced units
D)incremental revenue from the special order
Q2) Why does a special-order decision frequently ignore fixed factory overhead?
Q3) MacAllister Company charges cost plus 35%.Suppose the price of an item is $90.What is the item's cost?
A)$50.00
B)$62.50
C)$66.67
D)$80.00
Q4) Refer to the Figure.What is the contribution margin per hour of machine time for Test C?
A)$10
B)$20
C)$40
D)$100
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Chapter 14: Capital Investment Decisions
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153 Flashcards
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Sample Questions
Q1) A disadvantage of the payback period is that it ignores a project's total profitability.
A)True
B)False
Q2) Charlotte Company invests in a new piece of equipment costing $80,000.The equipment is expected to yield the following amounts per year for the equipment's four-year useful life: What is the net present value of this investment in equipment?
\(\begin{array} { l r } \text { Cash revenues } & \$ 120,000 \\ \text { Cash expenses } & ( 64,000 ) \\ \text { Depreciation expenses (straight-line) } & ( 20,000 ) \\ \text { Income provided from equipment } & \$ 36,000\\\text { Cost of capital }&14\% \end{array}\)
A)($4,480)
B)$41,592
C)$52,452
D)$83,184
Q3) Projects that do NOT affect the cash flows of other projects are called mutually exclusive projects.
A)True
B)False
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