Managerial Accounting Exam Questions
Course Introduction
Managerial Accounting focuses on the internal use of accounting information to aid managers in planning, controlling, and decision-making within an organization. The course covers techniques for analyzing financial and non-financial data, including budgeting, cost-volume-profit analysis, performance measurement, and cost allocation. Students will learn to apply accounting tools to real-world business scenarios, enabling them to make strategic decisions, manage resources efficiently, and contribute to the overall success of their organizations. Emphasis is placed on ethical considerations, the role of technology in managerial accounting, and the distinction between managerial and financial accounting.
Recommended Textbook
Accounting 9th Global Edition by Charles T. Horngren
Available Study Resources on Quizplus
24 Chapters
3900 Verified Questions
3900 Flashcards
Source URL: https://quizplus.com/study-set/3448
Page 2
Chapter 1: Accounting and the Business Environment
Available Study Resources on Quizplus for this Chatper
156 Verified Questions
156 Flashcards
Source URL: https://quizplus.com/quiz/68487
Sample Questions
Q1) A proprietor makes a cash withdrawal from the proprietorship. How does this affect the accounting equation?
A)This has no effect on assets, liabilities, or owner's equity.
B)Assets decrease; owner's equity decreases.
C)Assets increase; liabilities decrease.
D)Assets decrease; owner's equity increases.
Answer: B
Q2) Land is purchased by the business for $100,000. The company pays for land with a $20,000 cash payment and the execution of an $80,000 promissory note payable to the seller. How does this purchase affect the business's accounting equation?
A)Assets increase $80,000; liabilities decrease $20,000.
B)Assets increase $20,000; liabilities decrease $80,000.
C)Assets increase $80,000; owner's equity increases $80,000.
D)Assets increase $80,000; liabilities increase $80,000.
Answer: D
Q3) A not-for-profit organization has owners just like other forms of business.
A)True
B)False
Answer: False
To view all questions and flashcards with answers, click on the resource link above.
Page 3
Chapter 2: Recording Business Transactions
Available Study Resources on Quizplus for this Chatper
156 Verified Questions
156 Flashcards
Source URL: https://quizplus.com/quiz/68486
Sample Questions
Q1) A journal is a chronological record of transactions.
A)True
B)False
Answer: True
Q2) Which of the following accounts is an asset?
A)Salary expense
B)Accounts payable
C)Service revenue
D)Prepaid expenses
Answer: D
Q3) A journal entry for a $250 payment to purchase supplies was erroneously recorded as a debit to Supplies for $520 and a credit to Cash for $250. Which of the following statements about the trial balance is TRUE?
A)The sum of the credits will exceed the sum of the debits by $270.
B)The sum of the debits will exceed the sum of the credits by $250.
C)The sum of the debits will exceed the sum of the credits by $270.
D)The trial balance will be in balance; the sum of the credits will equal the sum of the debits.
Answer: C
To view all questions and flashcards with answers, click on the resource link above. Page 4
Chapter 3: The Adjusting Process
Available Study Resources on Quizplus for this Chatper
160 Verified Questions
160 Flashcards
Source URL: https://quizplus.com/quiz/68485
Sample Questions
Q1) The accountant for Duman Legal Services failed to make an adjusting entry for supplies that had been used for the year. Which of the following is TRUE?
A)Total liabilities are overstated.
B)Total liabilities are understated.
C)Total assets are overstated.
D)Total assets are understated.
Answer: C
Q2) Financial statements are prepared from a(n):
A)general journal.
B)general ledger.
C)unadjusted trial balance.
D)adjusted trial balance.
Answer: D
Q3) Which of the following would be considered an interim accounting period?
A)One to two months
B)One to two quarters
C)One to two years
D)Either one month or one quarter
Answer: D
To view all questions and flashcards with answers, click on the resource link above.
Page 5
Chapter 4: Completing the Accounting Cycle
Available Study Resources on Quizplus for this Chatper
165 Verified Questions
165 Flashcards
Source URL: https://quizplus.com/quiz/68484
Sample Questions
Q1) As part of the closing process, revenues and expenses are closed to a temporary account called Net income (loss).
A)True
B)False
Q2) Accounts payable is a temporary account.
A)True
B)False
Q3) Beginning balance in Capital is $80,000. Revenues are $60,000. Expenses are $75,000. No withdrawals were taken. The ending balance in Capital is $95,000.
A)True
B)False
Q4) Under which of the following categories would Land appear?
A)Long-term assets
B)Current assets
C)Long-term liabilities
D)Current liabilities
Q5) Reversing entries are posted on the first day of the month. A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 6
Chapter 5: Merchandising Operations
Available Study Resources on Quizplus for this Chatper
168 Verified Questions
168 Flashcards
Source URL: https://quizplus.com/quiz/68483
Sample Questions
Q1) A company sells merchandise for $1,000 on account with terms of 2/10, n/30. Defective merchandise of $200 is returned 2 days later. Which of the following entries would be made to record the cash receipt for the sale if the payment is received 20 days later?
A)The accounting entry would be an $800 debit to Cash and an $800 credit to Accounts receivable.
B)The accounting entry would be a $784 debit to Cash, a $16 debit to Sales discounts and an $800 credit to Accounts receivable.
C)The accounting entry would be a $16 debit to Sales discounts, an $800 debit to Cash and an $816 credit to Accounts receivable.
D)The accounting entry would be an $800 debit to Cash, a $16 credit to Sales discounts and a $784 credit to Accounts receivable.
Q2) Using the perpetual inventory system, discounts taken on an invoice, such as 3/10, n/30, would be:
A)debited to Inventory.
B)credited to Inventory.
C)debited to Cost of goods sold.
D)credited to Cost of goods sold.
To view all questions and flashcards with answers, click on the resource link above.
Page 7
Chapter 6: Merchandising Inventory
Available Study Resources on Quizplus for this Chatper
155 Verified Questions
155 Flashcards
Source URL: https://quizplus.com/quiz/68482
Sample Questions
Q1) Which of the following are clues that a company may have been "cooking the books" by fraudulently increasing their level of net sales?
A)Several shipping clerks checked into hospitals from lifting heavy boxes.
B)There was a very high level of returned goods shortly after year-end.
C)Several company warehouses reported burglaries.
D)There was a high level of inventory purchases in the following period.
Q2) The lower-of-cost-or-market rule demonstrates accounting conservatism in action. A)True
B)False
Q3) A company should NOT change the inventory costing method each period in order to maximize net income. This is an example of the disclosure principle.
A)True
B)False
Q4) The sum of the Cost of goods sold and the Ending inventory equals the Cost of goods available.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
8
Chapter 7: Internal Control and Cash
Available Study Resources on Quizplus for this Chatper
161 Verified Questions
161 Flashcards
Source URL: https://quizplus.com/quiz/68481
Sample Questions
Q1) A company check for payment must be signed by:
A)any employee of the company.
B)a bank employee.
C)a person specifically authorized by the company.
D)the external auditor.
Q2) In reconciling a bank statement, the bank balance is $1,800 and the checkbook balance is $1,205. Which of the following is the MOST probable reason why the bank balance is larger than the book balance?
A)There are outstanding checks.
B)The bank has deducted certain amounts for bank service charges.
C)A deposit in transit was made at the end of the month.
D)The company erroneously recorded a check for an amount less than actual.
Q3) Which of the following is a security procedure designed for e-commerce?
A)Burglar alarms
B)Firewalls
C)Fireproof vaults
D)Secure inventory storage
Q4) Mandatory vacations and job rotation improve internal control.
A)True
B)False
Page 9
To view all questions and flashcards with answers, click on the resource link above.
Chapter 8: Receivables
Available Study Resources on Quizplus for this Chatper
166 Verified Questions
166 Flashcards
Source URL: https://quizplus.com/quiz/68480
Sample Questions
Q1) The Allowance for uncollectible accounts currently has a debit balance of $200. The company's management estimates that 2.5% of net credit sales will be uncollectible. Net credit sales are $115,000. What will be the amount of Uncollectible accounts expense reported on the income statement?
A)$2,675
B)$2,875
C)$3,275
D)$3,075
Q2) The direct write-off method conforms to the matching principle better than the allowance method.
A)True
B)False
Q3) A company has significant uncollectible receivables. Why is the direct write-off method unacceptable?
A)Assets will be understated on the balance sheet.
B)It violates the matching principle.
C)Direct write-offs would be immaterial.
D)It is not allowed for tax reasons.
To view all questions and flashcards with answers, click on the resource link above.
10
Chapter 9: Plant Assets and Intangibles
Available Study Resources on Quizplus for this Chatper
170 Verified Questions
170 Flashcards
Source URL: https://quizplus.com/quiz/68479
Sample Questions
Q1) Depletion expense is the portion of a natural resource's cost used up in a particular period.
A)True B)False
Q2) Many companies have gotten into trouble by recording costs as expenses, rather than capitalizing them.
A)True B)False
Q3) The cost of excavating a basement for a new building is added to the price of the land.
A)True
B)False
Q4) Depletion is the word we use instead of depreciation to attach to recovering the cost of natural resources.
A)True B)False
Q5) When an asset is fully depreciated, no further depreciation expense is recorded. A)True B)False
To view all questions and flashcards with answers, click on the resource link above. Page 11
Chapter 10: Current Liabilities and Payroll
Available Study Resources on Quizplus for this Chatper
159 Verified Questions
159 Flashcards
Source URL: https://quizplus.com/quiz/68488
Sample Questions
Q1) RGF Manufacturing recently signed a $200,000, 4-month note on June 22. The interest rate is 5%. How much total interest will be due on the note?
A)$10,000
B)$3,833
C)$3,333
D)$203,780
Q2) When a note is payable in installments, the installments must be separately recorded in two different accounts-Short-term notes payable and Long-term notes payable-depending on the due dates of the installments.
A)True
B)False
Q3) SUTA (state unemployment compensation)tax is paid by the employee and deducted from gross pay.
A)True
B)False
Q4) Gross pay is the total amount of compensation earned by an employee, before any deductions are made.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 12
Chapter 11: Long-Term Liabilities, Bonds Payable, and
Available Study Resources on Quizplus for this Chatper
161 Verified Questions
161 Flashcards
Source URL: https://quizplus.com/quiz/68478
Sample Questions
Q1) On November 1, 2012, EZ Products borrowed $48,000 on a 5%, 10-year note with annual installment payments of $4,800 plus interest due on November 1 of each succeeding year. Which of the following describes the first installment payment made on November 1, 2013?
A)$4,800 principal plus $2,400 interest
B)$4,800 principal plus $400 interest
C)$2,400 principal plus $2,400 interest
D)$2,000 interest only
Q2) Which of the following statements is TRUE about a bond that is issued at a premium?
A)It will be sold above par.
B)Its interest rate lower than the prevailing market rate.
C)It will repay principal at more than the face value.
D)It will be sold at par.
Q3) Which of the following describes a term bond?
A)A bond that repays principal in installments
B)A bond that gives the bondholder a claim for specific assets if the issuer fails to pay
C)A bond that matures at one specified time
D)A bond that is not backed by specific assets
To view all questions and flashcards with answers, click on the resource link above. Page 13
Chapter
Available Study Resources on Quizplus for this Chatper
167 Verified Questions
167 Flashcards
Source URL: https://quizplus.com/quiz/68477
Sample Questions
Q1) Which of the following represents one of the basic rights of stockholders?
A)Stockholders can maintain their proportionate ownership if the corporation issues new stock.
B)Stockholders may sell their stock back to the company if they wish.
C)Stockholders may authorize a business contract on behalf of the corporation.
D)Stockholders may determine at what price the company issues stock.
Q2) On which of the following dates do dividends become a liability of a corporation?
A)On the declaration date
B)On the date of record
C)At the end of the fiscal year
D)On the payment date
Q3) The formation of a corporation is generally less complicated than the formation of a partnership.
A)True
B)False
Q4) All corporations must issue both common and preferred shares of stock.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 14
Chapter 13: Corporations: Effects on Retained Earnings and the
Income Statement
Available Study Resources on Quizplus for this Chatper
164 Verified Questions
164 Flashcards
Source URL: https://quizplus.com/quiz/68476
Sample Questions
Q1) Which of the following would be a reason for a company to appropriate a portion of retained earnings?
A)To ensure that the business does not take on too much debt
B)To increase the amount of earnings available for dividends
C)To help the company control levels of operating expenses
D)To limit the amount of retained earnings available for dividends, in order to retain sufficient funds for growth
Q2) Which of the following would be a reason for a company to restrict its cash dividends or treasury stock purchases?
A)Because the company needs treasury stock to offer as performance incentives to upper management
B)In order to give shareholders stock dividends
C)Due to the desire of shareholders to retain the company's earnings for future growth and capital expenditures
D)Due to requirements of lenders or creditors that companies maintain enough equity to meet their obligations
To view all questions and flashcards with answers, click on the resource link above.
15
Chapter 14: The Statement of Cash Flows
Available Study Resources on Quizplus for this Chatper
162 Verified Questions
162 Flashcards
Source URL: https://quizplus.com/quiz/68475
Sample Questions
Q1) The statement of cash flows explains the difference between net income and the change in cash balance.
A)True
B)False
Q2) The financing section of the statement of cash flows reflects transactions in the equity accounts only.
A)True
B)False
Q3) Which of the following sections from the statement of cash flows includes purchases and sales of long-term assets?
A)The financing section
B)The operating section
C)The investing section
D)The noncash investing and financing section
Q4) Buying property, plant and equipment would be considered a cash outflow from financing.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
Page 16
Chapter 15: Financial Statement Analysis
Available Study Resources on Quizplus for this Chatper
163 Verified Questions
163 Flashcards
Source URL: https://quizplus.com/quiz/68474
Sample Questions
Q1) Benchmarking is the comparison of a company's current year results with an earlier year's performance.
A)True
B)False
Q2) The rate of return on total assets is a way to measure a company's profitability.
A)True
B)False
Q3) The debt ratio is the ratio of total debt divided by total equity.
A)True
B)False
Q4) A company reports net income of $70,000 and net sales of $950,000. Which of the following is the rate of return on net sales?
A)0.05
B)0.20
C)0.07
D)0.66
Q5) The inventory turnover ratio indicates how rapidly inventory is sold.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 17
Chapter 16: Introduction to Management Accounting
Available Study Resources on Quizplus for this Chatper
163 Verified Questions
163 Flashcards
Source URL: https://quizplus.com/quiz/68473
Sample Questions
Q1) The cost of goods sold for Frye Manufacturing in 2012 was $233,000. The January 1, 2012 finished goods inventory balance was $31,600, and the December 31, 2012 finished goods inventory balance was $24,200. What was cost of goods manufactured during 2012?
A)$288,800
B)$233,000
C)$225,600
D)$240,400
Q2) Management is accountable to its suppliers and vendors in which of the following ways?
A)Providing products to customers that are safe and free of defects
B)Repaying loans in a timely manner
C)Providing a return on the owner's shareholders' investment
D)Making timely payments and complying with contract terms
Q3) Which of the following applies to goods that are purchased from a producer and sold by a merchandising company?
A)Materials inventory
B)Work in process inventory
C)Merchandise inventory
D)Finished goods inventory
To view all questions and flashcards with answers, click on the resource link above. Page 18
Chapter 17: Job Order and Process Costing
Available Study Resources on Quizplus for this Chatper
172 Verified Questions
172 Flashcards
Source URL: https://quizplus.com/quiz/68472
Sample Questions
Q1) On June 30, Coraline Company finished job number 750, with total job costs of $4,600, and transferred the costs to Finished goods. On July 6, they completed the sale of the goods to a customer for $5,100 cash. In order to record the sale, two entries are necessary, one to record revenue, and one to record cost of goods sold. Which of the following is the correct entry needed to record the revenues?
A)Debit Finished goods inventory $4,600, credit Sales revenue $4,600
B)Debit cash $5,100, credit Sales revenue $5,100
C)Debit Sales revenue $5,100, credit Cash $5,100
D)Debit Cost of goods sold $4,600, credit Sales revenue $4,600
Q2) When manufacturing overhead is allocated, the amount is recorded as a debit to Finished goods and a credit to Work in process.
A)True
B)False
Q3) When direct materials are requisitioned, the Work in process account will be debited.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
Page 19
Chapter 18: Activity-Based Costing and Other Cost Management Tools
Available Study Resources on Quizplus for this Chatper
162 Verified Questions
162 Flashcards
Source URL: https://quizplus.com/quiz/68471
Sample Questions
Q1) Pollenti Company has just merged with another industrial firm whose business had been failing. Pollenti immediately conducted a thorough study of the new company's work processes, and produced a report including the data shown below: A new inspection process is recommended to minimize defective raw materials. It would cost $12,000 to implement.
Shoddy business practices are resulting in excessive warranty costs $15,000 more than normal due mainly to material failure.
Reengineering of the assembly line will increase productivity. It would cost $18,000 to implement.
Inefficient workplace design is costing $5,000 in unnecessary rework costs.
Estimated amount of lost profits due to dissatisfied customers who turn to the competition is $80,000.
Based on the above, what is the amount of external failure costs, if any, included here?
A)$5,000
B)$12,000
C)$95,000
D)Zero
To view all questions and flashcards with answers, click on the resource link above.
Page 20
Chapter 19: Cost-Volume-Profit Analysis
Available Study Resources on Quizplus for this Chatper
165 Verified Questions
165 Flashcards
Source URL: https://quizplus.com/quiz/68470
Sample Questions
Q1) Peterson Company has both fixed and variable costs. If the volume doubles, the total of all costs combined will double.
A)True
B)False
Q2) Porterhouse Company has both fixed and variable production costs. If volume goes up by 20%, how would that affect the total of all costs? (Assume all volumes are within the relevant range.)
A)Would go up 20%
B)Would remain the same
C)Would go up by some amount less than 20%
D)Would go down
Q3) CVP graphs can help managers quickly estimate the profit or loss earned at different levels of sales volume.
A)True
B)False
Q4) The variable cost per unit is assumed to be constant within a particular relevant range of activity.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 21
Chapter 20: Short-Term Business Decisions
Available Study Resources on Quizplus for this Chatper
163 Verified Questions
163 Flashcards
Source URL: https://quizplus.com/quiz/68469
Sample Questions
Q1) A company produces 100 microwave ovens per month, each of which includes one electrical circuit. The company currently manufactures the circuit in-house but is considering outsourcing the circuits at a contract price of $28 each. Currently, the cost of producing circuits in-house includes variable costs of $26 per circuit and fixed costs of $5,000 per month. Assume the company could not reduce any fixed costs by outsourcing, and that there is no alternative use for the facilities presently being used to make circuits. If the company outsources, how will it affect monthly operating income?
A)Operating income will go up by $4,800.
B)Operating income will go down by $2,800.
C)Operating income will go down by $200.
D)Operating income will stay the same.
Q2) Which of the following business strategies would NOT be consistent with a price setter?
A)Enter a competitive market and focus on cost cutting
B)Produce a unique product
C)Exploit the value of a fashionable brand name
D)Differentiate the product clearly from the competitors
To view all questions and flashcards with answers, click on the resource link above.
Page 22
Chapter 21: Capital Investment Decisions and the Time
Value of Money
Available Study Resources on Quizplus for this Chatper
153 Verified Questions
153 Flashcards
Source URL: https://quizplus.com/quiz/68468
Sample Questions
Q1) Dylan Company is considering an investment in new equipment costing $720,000. The equipment will be depreciated on a straight-line basis over a five-year life and is expected to have a salvage value of $45,000. The equipment is expected to generate net cash flows totaling $970,000 during the five years. What is the rate of return associated with the equipment investment?
A)15.4%
B)16.4%
C)30.4%
D)13.9%
Q2) Using the NPV method of evaluating investments, a company should consider a project a good investment opportunity as long as the NPV of the total cash flows is positive.
A)True
B)False
Q3) When a company invests in lean manufacturing processes or "green" technologies, the efficiencies and elimination of waste are factors that should NOT be included when conducting a discounted cash flow analysis of the investment.
A)True
B)False
Page 23
To view all questions and flashcards with answers, click on the resource link above.
Chapter 22: The Master Budget and Responsibility Accounting
Available Study Resources on Quizplus for this Chatper
157 Verified Questions
157 Flashcards
Source URL: https://quizplus.com/quiz/68467
Sample Questions
Q1) Argyle Company forecasts sales of $50,000 in January, $60,000 in February, $70,000 in March, and $75,000 in April. The inventory balance at January 1 is $12,000. Cost of goods sold is budgeted at 40% of sales revenue. Argyle wishes to have inventory levels at the end of each month equal to 60% of cost of goods sold for the following month, plus a "safety cushion" of $1,000. How much should be budgeted for inventory purchases in February?
A)$21,000
B)$22,100
C)$26,400
D)$23,400
Q2) Which of the following is an example of the benchmarking function of a budget?
A)A budget demands integrated input from different business units and functions.
B)Budgeting requires close cooperation between accountants and operational personnel.
C)Budget figures are used to evaluate the performance of managers.
D)The budget outlines a specific course of action for the coming period.
Q3) The capital expenditure budget is part of the operating budget.
A)True
B)False
Page 24
To view all questions and flashcards with answers, click on the resource link above.
Chapter 23: Flexible Budgets and Standard Costs
Available Study Resources on Quizplus for this Chatper
166 Verified Questions
166 Flashcards
Source URL: https://quizplus.com/quiz/68466
Sample Questions
Q1) When management is investigating overhead variances, they need to further determine whether cost increases were controllable or uncontrollable.
A)True
B)False
Q2) Cardinal Corporation produces birdhouses. It takes 1 hour of direct labor to produce a birdhouse. Cardinal's standard labor cost is $15 per hour. During June, Cardinal produced 10,000 birdhouses and used 10,250 hours of direct labor at a total cost of $143,500. What is Cardinal's direct labor price variance for June?
A)$10,000 U
B)$10,250 U
C)$10,250 F
D)$10,000 F
Q3) Which one of the following is NOT a reason for using standard costs?
A)To set performance targets
B)To strengthen internal controls over inventory
C)To decrease accounting costs
D)To make budgeting easier
To view all questions and flashcards with answers, click on the resource link above.
25
Chapter 24: Performance Evaluation and the Balanced Scorecard
Available Study Resources on Quizplus for this Chatper
166 Verified Questions
166 Flashcards
Source URL: https://quizplus.com/quiz/68465
Sample Questions
Q1) In a balanced scorecard system, if customer satisfaction was one of the critical factors, which of the following would be a relevant KPI?
A)Revenue growth
B)Production yield rate
C)Market share
D)Employee training hours
Q2) Which of the following statements is TRUE about the weighted average cost of capital (WACC)?
A)If a business has a high risk level, the WACC will be higher.
B)If a business has a high risk level, the WACC will be lower.
C)The WACC represents the corporation's internal return targets.
D)The WACC is the same as a business's ROI.
Q3) One perspective of the balanced scorecard focuses on revenue growth and productivity. Which of the four perspectives is this?
A)Financial perspective
B)Customer perspective
C)Internal business perspective
D)Learning and growth perspective
To view all questions and flashcards with answers, click on the resource link above. Page 26