Management Accounting Test Preparation
Course Introduction
Management Accounting explores the processes and techniques used to provide financial and non-financial information to managers for decision-making, planning, and control within organizations. The course covers cost classification, budgeting, standard costing, variance analysis, performance measurement, and relevant costing for managerial decisions. Emphasis is placed on how management accounting supports strategic objectives, improves efficiency, and enhances operational effectiveness by delivering critical insights tailored to internal business needs. Students will develop analytical skills to interpret data, prepare management reports, and advise on the financial implications of business strategies.
Recommended Textbook
Cost Management A Strategic Emphasis 6th Edition by Edward Blocher
Available Study Resources on Quizplus
20 Chapters
2503 Verified Questions
2503 Flashcards
Source URL: https://quizplus.com/study-set/2632
Page 2
Chapter 1: Cost Management and Strategy
Available Study Resources on Quizplus for this Chatper
79 Verified Questions
79 Flashcards
Source URL: https://quizplus.com/quiz/52540
Sample Questions
Q1) The five steps of strategic decision making include all of the following except:
A)Based on strategy and analysis, choose and implement the desired alternative.
B)Identify the alternative actions.
C)Determine the strategic issues surrounding the problem.
D)Select the proper cost management technique.
E)Provide an ongoing evaluation of the effectiveness of the decision.
Answer: D
Q2) Which of the following aspects of a company would not be considered a critical success factor, for a company that competes on differentiation?
A)Cutting edge research and development.
B)Excellent customer service.
C)Award-winning product quality.
D)Continually beating competitors to the market with new, innovative products.
E)A high level of production efficiency
Answer: E
To view all questions and flashcards with answers, click on the resource link above. Page 3
Available Study Resources on Quizplus for this Chatper
70 Verified Questions
70 Flashcards
Source URL: https://quizplus.com/quiz/52539
Sample Questions
Q1) Patagonia, maker of clothing and gear for outdoor enthusiasts, is very conscious of sustainability issues. The company chose not to produce a product because:
A)The cost of manufacturing the product exceeded its target cost.
B)There was not sufficient demand for the product at the planned price.
C)The environmental impact of toxic waste was unacceptable.
D)The environmental impact of producing the product in terms of carbon emissions and energy consumptions was unacceptable.
E)The company could not justify adding another product when there were acceptable alternatives already in the company's product offerings.
Answer: D
Q2) Which of the following is not a term used for a phase of the value chain?
A)Operations.
B)Upstream.
C)Downstream.
D)Marketing.
Answer: D
To view all questions and flashcards with answers, click on the resource link above.
4
Chapter 3: Basic Cost Management Concepts
Available Study Resources on Quizplus for this Chatper
98 Verified Questions
98 Flashcards
Source URL: https://quizplus.com/quiz/52538
Sample Questions
Q1) Factory overhead costs for a given period were 2 times as much as the direct material costs. Prime costs totaled $8,000. Conversion costs totaled $11,350. What are the direct labor costs for the period?
A)$4,650.
B)$3,560.
C)$4,200.
D)$3,860.
Answer: A
Q2) What should be the amount of total manufacturing cost?
A)$340,000.
B)$350,000.
C)$380,000.
D)$395,000.
Answer: B
Q3) Which of the following is not a product cost?
A)Direct materials costs
B)Selling costs
C)Direct labor costs
D)Factory overhead costs
Answer: B
To view all questions and flashcards with answers, click on the resource link above. Page 5
Chapter 4: Job Costing
Available Study Resources on Quizplus for this Chatper
118 Verified Questions
118 Flashcards
Source URL: https://quizplus.com/quiz/52537
Sample Questions
Q1) Amy and Jay Golden have worked for five years in a firm specializing in restoration of historical buildings. Amy has focused on interior reconditioning and Jay on architectural and structural design. They have specialized in residential structures for the past two years, and are thinking of forming their own residential restoration firm. They plan to do all the structural and decorative design, and subcontract the actual construction and decorative work. One of their concerns is to have an accounting system in place when they begin their business. You have been asked to assist them by answering the following questions.
Required:
(1) Since we have a very basic service-type firm, can a simple accounting system be developed?
(2) What kinds of information does the accounting system need to collect?
Q2) Departmental rates are appropriate when all the following exist except:
A)Not all products pass through the same processes.
B)Departments are not similar in function.
C)Departments have dissimilar cost drivers.
D)All departments have similar cost drivers and cost usage characteristics.
E)Products consume departmental resources in a significantly different manner.
To view all questions and flashcards with answers, click on the resource link above. Page 6
Chapter 5: Activity-Based Costing and Customer
Profitability Analysis
Available Study Resources on Quizplus for this Chatper
149 Verified Questions
149 Flashcards
Source URL: https://quizplus.com/quiz/52536
Sample Questions
Q1) An activity that is performed to support the production of a new custom-order product is a(n):
A)Product-level activity.
B)Facility-level activity.
C)Unit-level activity.
D)Customer-support activity.
E)Batch-level activity.
Q2) Which of the following is a benefit of activity-based costing?
A)Reduced overhead costs.
B)More accurate measures of production volume.
C)Facilitate better product pricing decisions.
D)Having fewer cost drivers than volume-based costing systems.
E)More streamlined manufacturing processes.
Q3) Using activity-based costing, total overhead per unit of Great P model is (rounded to the nearest cent):
A)$42.61.
B)$45.99.
C)$61.32.
D)$66.73.
E)$168.00.
7
To view all questions and flashcards with answers, click on the resource link above.
Chapter 6: Process Costing
Available Study Resources on Quizplus for this Chatper
106 Verified Questions
106 Flashcards
Source URL: https://quizplus.com/quiz/52535
Sample Questions
Q1) Irvine Company uses process costing. The following data are available for the month of June.
(a) Materials purchased, $800,000.
(b) Materials used: Direct materials: Department A $250,000, Department B $230,000. Indirect materials: $20,000.
(c) Factory payroll incurred, $600,000: Direct labor: Department A $300,000, Department B $200,000. Indirect labor: $100,000.
(d) Other factory overhead incurred, $30,000: Power and light $2,000, Depreciation $20,000, Property tax $5,000, Insurance $3,000.
(e) Factory overhead cost was allocated equally to Department A and DepartmentB.
(f) Department A completed and transferred to department B $600,000.
(g) Department B completed and transferred to Finished Goods Inventory account $1,000,000.
Required:
(1) Prepare journal entries for June activities in Irvine Company.
(2) Compute ending working-in-process inventories in Department A and Department
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: Cost Allocation: Departments, Joint Products, and By-Products
Available Study Resources on Quizplus for this Chatper
96 Verified Questions
96 Flashcards
Source URL: https://quizplus.com/quiz/52534
Sample Questions
Q1) The total cost accumulated in the assembly department using the step method is (calculate all ratios and percentages to 4 decimal places, for example 33.3333%, and round all dollar amounts to the nearest whole dollar):
A)$1,000,125.
B)$1,890,000.
C)$689,875.
D)$642,000.
E)$923,000.
Q2) In making decisions about whether to sell or further process joint products, allocation of common or joint costs is:
A)Essential.
B)Useful.
C)Irrelevant.
D)Is useful depending on the method chosen.
E)Is the only way to get the true total product cost.
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: Cost Estimation
Available Study Resources on Quizplus for this Chatper
120 Verified Questions
120 Flashcards
Source URL: https://quizplus.com/quiz/52533
Sample Questions
Q1) Data collected on the cost objects and cost drivers for cost estimation must be:
A)Brief and limited.
B)Exhaustive.
C)Concrete.
D)Consistent and accurate.
E)Varied.
Q2) How should the cost function be properly stated?
A)Y = $2,025 + $2.50H.
B)Y = $3,890 + $2.00H.
C)Y = $4,085 + $2.00H.
D)Y = $5,260 + $2.50H.
Q3) Which of the following is not usually influenced by learning curve analysis?
A)Make-or-buy decisions.
B)Cost-volume-profit analysis.
C)Capital budgeting.
D)Development of standard product costs.
E)Theory of constraints.
To view all questions and flashcards with answers, click on the resource link above.
10
Chapter
Cvp Analysis
Available Study Resources on Quizplus for this Chatper
105 Verified Questions
105 Flashcards
Source URL: https://quizplus.com/quiz/52532
Sample Questions
Q1) The degree of operating leverage (DOL) at any given sales volume, X, is useful as:
A)An alternative measure of the breakeven volume.
B)A measure of targeted profit, expressed on a pre-tax basis.
C)A way to estimate fixed costs for an upcoming period.
D)A measure of risk in conjunction with a CVP model.
E)An easy way to perform a Monte Carlo Simulation (MCS) analysis.
Q2) The CVP profit-planning model assumes that over the relevant range of activity:
A)Only revenues are linear.
B)Only revenues and fixed costs are linear.
C)Only revenues and variable costs are linear.
D)Variable cost per unit decreases because of increases in productivity.
E)Both revenues and total costs are linear.
Q3) Cleaning Care's margin of safety (MOS) in sales dollars is:
A)$12,000.
B)$24,000.
C)$48,000.
D)$50,000.
E)$96,000.
To view all questions and flashcards with answers, click on the resource link above. Page 11
Chapter 10: Strategy and the Master Budget
Available Study Resources on Quizplus for this Chatper
146 Verified Questions
146 Flashcards
Source URL: https://quizplus.com/quiz/52531
Sample Questions
Q1) Suppose that Capital One's management believes that a $1,600 increase in the monthly promotion costs will provide a boost to sales. By what amount must sales increase during the month to justify the contemplated expenditure? Round answer up to the nearest whole number.
A)200 units.
B)334 units.
C)400 units.
D)668 units.
E)None of the above.
Q2) Sales forecasting by its nature is:
A)Precise.
B)Deterministic in nature.
C)Objective.
D)Somewhat subjective.
E)Mechanical.
Q3) Allmakes Software budgeted August purchases of new software at $140,000.The store had software costing $6,000 on hand at the beginning of August, and to cover part of anticipated back-to-school sales in September they expect to have $15,000 of software on hand at the end of August.
Required: What was the budgeted cost of goods sold for August?
To view all questions and flashcards with answers, click on the resource link above. Page 12
Chapter 11: Decision Making With a Strategic Emphasis
Available Study Resources on Quizplus for this Chatper
137 Verified Questions
137 Flashcards
Source URL: https://quizplus.com/quiz/52530
Sample Questions
Q1) Operating at or near full capacity will require a firm considering a special sales order to potentially recognize the:
A)Opportunity cost from lost sales.
B)Value of full employment.
C)The use of operating leverage.
D)Need for good management.
E)Importance of facility-level cost drivers.
Q2) In a joint production process, joint product costs are:
A)Those costs incurred after the split-off point.
B)Allocated to outputs (products) to facilitate short-term decision making.
C)Not relevant to the decision whether to produce at all.
D)Those that are incurred before the point in the process when individual products arise.
E)Relatively small compared to costs incurred after the split-off point.
Q3) Sunk costs:
A)Are substitutes for opportunity costs.
B)In and of themselves are not relevant to decision making.
C)Are, by definition, relevant to decision making.
D)Are fixed costs.
E)Are relevant to long-run but generally not to short-run decisions.
To view all questions and flashcards with answers, click on the resource link above.
Page 13
Chapter 12: Strategy and the Analysis of Capital Investments
Available Study Resources on Quizplus for this Chatper
167 Verified Questions
167 Flashcards
Source URL: https://quizplus.com/quiz/52529
Sample Questions
Q1) What is the net present value (NPV) of the investment? (The PV annuity factor for 5 years, 10% is 3.791.) Assume that the cash inflows occur at year-end.
A)($270,480).
B)$63,936.
C)$109,428.
D)$154,920.
E)None of the above.
Q2) The amount of after-tax cash inflow from the asset in Year 3 is:
A)$6,600.
B)$7,500.
C)$8,100.
D)$9,000.
E)$9,750.
Q3) A characteristic of the payback method (before taxes) is that it
A)Never incorporates the time value of money.
B)Neglects total project profitability.
C)Uses accrual accounting numbers in the numerator of the calculation.
D)Uses the estimated life of the asset in the denominator of the calculation.
E)Uses the hurdle (i.e., discount) rate in the calculation.
Page 14
To view all questions and flashcards with answers, click on the resource link above.
Chapter 13: Cost Planning for the Product Life Cycle: Target
Costing, Theory of Constraints, and Strategic Pricing
Available Study Resources on Quizplus for this Chatper
94 Verified Questions
94 Flashcards
Source URL: https://quizplus.com/quiz/52528
Sample Questions
Q1) Caldwell Company desires to enter a market with a new product. As part of this process the following tasks will be performed: 1. Determine a desired profit margin.
2) Use Kaizen costing.
3) Design and engineer the product.
4) Determine the product's cost.
5) Determine the suggested selling price.
Which task would Caldwell Company perform first if it plans to use target costing?
A)Determine a desired profit margin.
B)Use Kaizen costing.
C)Design and engineer the product.
D)Determine the product's cost.
E)Determine the suggested selling price.
Q2) Which function(s) is/are the bottleneck(s)?
A)Exterior construction and pulp filter insertion.
B)Pulp filter insertion.
C)Painting.
D)Packaging.
E)Exterior construction.
To view all questions and flashcards with answers, click on the resource link above. Page 15
Chapter
Direct-Cost Variances, and the Role of Nonfinancial
Performance Measures
Available Study Resources on Quizplus for this Chatper
178 Verified Questions
178 Flashcards
Source URL: https://quizplus.com/quiz/52527
Sample Questions
Q1) The direct materials usage variance for December is:
A)$1,800 unfavorable.
B)$1,800 favorable.
C)$59,400 unfavorable.
D)$59,400 favorable.
Q2) The way managers and employees who are affected by a standard cost system perceive the system will:
A)Be of little consequence on the success of the system if correctly implemented.
B)Generally be minimal in impact on the implementation of the system.
C)Affect its success or failure in implementing the system.
D)Be difficult to assess.
E)Not matter in the long run.
Q3) The actual total cost of direct materials used in production is:
A)$458,068.
B)$459,862.
C)$461,132.
D)$462,938.
E)$478,400.
Q4) What is a direct materials usage ratio? For what purpose is this ratio used?
To view all questions and flashcards with answers, click on the resource link above. Page 16
Chapter 15: Operational Performance Measurement:
Indirect-Cost Variances and Resource-Capacity Management
Available Study Resources on Quizplus for this Chatper
167 Verified Questions
167 Flashcards
Source URL: https://quizplus.com/quiz/52526
Sample Questions
Q1) In a standard cost system, when production is greater than the denominator volume level, there will be:
A)An unfavorable production-volume variance.
B)An unfavorable total spending variance.
C)A favorable production-volume variance.
D)A favorable sales-volume variance.
E)A favorable overhead budget variance.
Q2) A comprehensive management accounting and control system regarding manufacturing overhead costs:
A)Includes nonfinancial but not financial performance indicators.
B)Relies on direct managerial observation rather than a formal system for cost-control purposes.
C)Provides information for strategic but not operational control.
D)Provides financial-control information to operating personnel, while both financial and nonfinancial performance indicators to managers.
E)Includes both financial performance indicators as well as nonfinancial performance indicators.
To view all questions and flashcards with answers, click on the resource link above. Page 17
Chapter 16: Operational Performance Measurement:
Further Analysis of Productivity and Sales
Available Study Resources on Quizplus for this Chatper
134 Verified Questions
134 Flashcards
Source URL: https://quizplus.com/quiz/52525
Sample Questions
Q1) The partial direct labor operational productivity in 2012 is:
A)0.22.
B)0.25.
C)4.00.
D)4.50.
E)5.00.
Q2) What is ET's sales mix variance?
A)$7,680 favorable.
B)$8,640 favorable.
C)$11,520 favorable.
D)$12,960 favorable.
E)$24,960 favorablE.
Q3) The sales quantity variance for Product X is:
A)$4,000 favorable.
B)$25,000 favorable.
C)$26,000 favorable.
D)$45,000 favorable.
E)$52,000 unfavorablE.Total units: budget = 2,000 + 6,000 = 8,000; actual units = 1,500 + 8,500 = 10,000
Page 18
To view all questions and flashcards with answers, click on the resource link above.
Chapter 17: The Management and Control of Quality
Available Study Resources on Quizplus for this Chatper
147 Verified Questions
147 Flashcards
Source URL: https://quizplus.com/quiz/52524
Sample Questions
Q1) What effect does the new equipment have on appraisal costs?
A)$10,000 increase.
B)$20,000 decrease.
C)$170,000 increase.
D)$220,000 increase.
E)No change.
Q2) The cost of statistical quality control in a product quality cost system is properly characterized as a(n):
A)External failure cost.
B)Internal failure cost.
C)Training cost.
D)Opportunity cost.
E)Appraisal cost.
Q3) In a Cost-of-Quality (COQ) reporting framework, the "cost of nonconformance" includes:
A)Prevention costs and appraisal costs.
B)Internal failure costs and external failure costs.
C)Prevention costs and internal failure costs.
D)Appraisal costs, internal failure costs, and external failure costs.
E)Prevention costs and external failure costs.
To view all questions and flashcards with answers, click on the resource link above. Page 19
Chapter 18: Strategic Performance Measurement: Cost
Centers, Profit Centers, and the Balanced Scorecard
Available Study Resources on Quizplus for this Chatper
133 Verified Questions
133 Flashcards
Source URL: https://quizplus.com/quiz/52523
Sample Questions
Q1) Variable costing operating income for 2013 is calculated to be:
A)$149.
B)$430.
C)$655.
D)$1,030.
E)$1,180.
Q2) Which of the following is not a revenue driver factor which affects sales volume for a manufacturing firm?
A)Price changes.
B)Customer service.
C)Delivery dates.
D)Discounts.
E)Productivity.
Q3) Expenditures made in revenue centers usually include:
A)Order-purchasing costs.
B)Order-getting costs.
C)Order-producing costs.
D)Order-scheduling costs.
E)Order-delivering costs.
To view all questions and flashcards with answers, click on the resource link above.
Chapter 19: Strategic Performance Measurement:
Investment Centers and Transfer Pricing
Available Study Resources on Quizplus for this Chatper
151 Verified Questions
151 Flashcards
Source URL: https://quizplus.com/quiz/52522
Sample Questions
Q1) Which one of the following is not a limitation shared by residual income (RI) and return on investment (ROI) divisional performance measures?
A)They are both short-term performance indicators.
B)They both may fail to capture significant value-creating activities of the organization.
C)They are both subject to short-term manipulation on the part of divisional managers.
D)Both are subject to a number of measurement issues that complicate their use in practice.
E)They both relate, in percentage terms, earnings to the level of investment in each division.
Q2) This question pertains to the use of market-based transfer prices.
Required:
What is the primary advantage and what is the primary difficulty in using market-based transfer prices?
Q3) What are the principal advantages and disadvantages of using cost-based transfer prices? (Give a short explanation of each item you list.)
To view all questions and flashcards with answers, click on the resource link above.
21
Chapter 20: Management Compensation, Business
Analysis, and Business
Valuation
Available Study Resources on Quizplus for this Chatper
108 Verified Questions
108 Flashcards
Source URL: https://quizplus.com/quiz/52521
Sample Questions
Q1) EVA is calculated as:
A)EVA Net Income - (Cost of Capital x EVA Invested Capital).
B)Total Net Income - (Cost of Capital x Invested Capital).
C)Gross Income - Cost of Capital.
D)Total Net Income - EVA Net Income.
E)Accounting earnings adjusted for EVA.
Q2) A CFO whose compensation plan may have had the effect of creating an incentive for unethical actions includes:
A)Kenneth Lay
B)Scott Sullivan
C)Bernie Madoff
D)Dennis Kozlowski
Q3) The ideal compensation plan would make all company contributions to the plan immediately tax-deductible and all tax consequences for managers:
A)Insignificant.
B)Deferred or avoidable.
C)Limited, but current.
D)Limited, but pre-paid.
To view all questions and flashcards with answers, click on the resource link above. Page 22