Strategic Management Accounting
Textbook Exam Questions
Course Introduction
Strategic Management Accounting explores the role of accounting information in formulating and implementing business strategy. This course examines the integration of accounting techniques with management decision-making to drive long-term organizational success. Topics include cost management, performance measurement, budgeting, value chain analysis, and competitive positioning, with an emphasis on providing relevant financial and non-financial data to support strategic choices. Through case studies and applied projects, students learn how to use management accounting tools to analyze complex business environments, enhance value creation, and sustain competitive advantage.
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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Sample Questions
Q1) Which of the following employees would normally occupy a line position in a hospital?
A)the manager of the cafeteria
B)a hospital administrator
C)the chief of surgery
D)a staff nurse
Answer: C
Q2) The belief that each member of a group bears some responsibility for the well-being of other members is a common principle underlying all ethical systems.
A)True
B)False
Answer: True
Q3) CMA,CGA and CA organizations have recently have been brought together under a new professional body called CPA Canada.
A)True
B)False
Answer: True
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Page 3
Chapter 2: Basic Managerial Accounting Concepts
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222 Flashcards
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Sample Questions
Q1) Nelvana Company makes tablets.During the year,Nelvana manufactured and sold 75,000 tablets at a sales price of $600 per unit.Nelvana's per-unit product cost was $540,and selling and administrative expenses totalled $3,200,000.
Required:
A. Compute the total sales revenue.
B. Compute the gross margin.
C. Compute the operating income.
D. Compute the operating income if 75,000 tablets were produced and 69,000 were sold.
Answer: 11ea8d4f_07ea_4e57_b445_d5f933cf924c_TB6710_00
Q2) Which of the following is characteristic of a manufacturer?
A)It will show the ending balance of work in process.
B)It contains only manufacturing costs.
C)It will show the ending balance of materials inventory.
D)It covers a certain period of time.
Answer: D
Q3) Sugar used in cookie production
A)Product cost
B)Period cost
Answer: A
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Page 4
Chapter 3: Cost Behaviour
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222 Flashcards
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Sample Questions
Q1) corresponds to the fixed cost
A)Dependant variable
B)Independent variable
C)Intercept
D)Slope Answer: C
Q2) Has an increased fixed component at specific intervals
A)Variable
B)Fixed
C)Mixed
D)Step Answer: D
Q3) Cost of gear shifters
A)Variable
B)Fixed Answer: A
Q4) Real estate taxes
A)Variable
B)Fixed Answer: B
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Chapter 4: Costvolumeprofit Analysis: a Managerial Planning Tool
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Sample Questions
Q1) What is the purpose of doing a cost-volume-profit (CVP)analysis?
A)CVP analysis provides managers with information used for control only.
B)CVP analysis allows managers to do sensitivity analysis by examining the impact of various prices or costs on volume.
C)CVP analysis shows how revenues, expenses, and profits behave as volume changes.
D)CVP analysis is effectively used by single-product firms only.
Q2) What "what-if" technique examines the impact on an answer as a result of changes in underlying assumptions?
A)degree of sensitivity
B)sensitivity training
C)sensitivity analysis
D)degree of operating leverage
Q3) Refer to the Figure.What is the variable expense ratio?
A)36%
B)40%
C)46%
D)50%
Q4) What are the assumptions underlying cost-volume-profit analysis?
Q5) Explain why cost-volume-profit analysis can be useful to managers.
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Chapter 5: Job-Order Costing
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177 Flashcards
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Sample Questions
Q1) Actual overhead is used to arrive at the cost of goods manufactured.
A)True
B)False
Q2) Refer to Rally Point,Inc.What is the balance in the work-in-process account on January 31?
A)$0
B)$16,100
C)$23,600
D)$212,390
Q3) A job-order cost sheet is the source document where direct labour costs are assigned to individual jobs.
A)True
B)False
Q4) Which account is usually credited when the work-in-process account is debited for direct labour?
A)cash
B)wages payable
C)overhead control
D)raw materials
Q5) What are the three steps of overhead application?
Page 7
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Chapter 6: Process Costing
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Sample Questions
Q1) Any product or service that is basically homogeneous and repetitively produced can take advantage of a process-costing approach.
A)True
B)False
Q2) Units must pass through one process before they can be worked on in later processes.
A)Parallel processing
B)Sequential processing
C)Process costing
D)Weighted average costing method
Q3) When should process costing techniques be used in assigning costs to products?
A)any time production is only partially completed during the accounting period
B)when the product is composed of mass-produced homogeneous products
C)when the product is manufactured according to customer specifications
D)when the product is unique and made to order
Q4) Describe how process costing for services differs from process costing for manufactured goods.
Q5) Refer to Process Department A.
A. What is the cost of goods transferred out?
B. What is the cost of ending work-in-process inventory?
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Chapter 7: Activity-Based Costing and Management
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Sample Questions
Q1) Refer to the Figure.What is the total cost per component associated with using Customer 2 as the supplier?
A)$8.95
B)$12.00
C)$15.74
D)$84.26
Q2) Activities necessary to remain in business are called value added activities.
A)True
B)False
Q3) Which of the following is an example of types of resources consumed in an activity dictionary?
A)activity sharing
B)qualities
C)activity attributes
D)allocations
Q4) One way to improve efficiency is to produce higher activity output with higher cost. A)True
B)False
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Page 9
Chapter 8: Absorption and Variable Costing, and Inventory Management
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Sample Questions
Q1) How does a JIT system respond to the problems traditionally solved by carrying inventories?
A)by ensuring that sufficient inventory is on hand to prevent stockouts
B)by purchasing extra materials when price discounts are offered
C)by negotiating long-term contracts with supplier to lock in low prices
D)by selecting an inventory level that minimizes the total of ordering and carrying costs
Q2) Stimpson Company sells 900 units of its deluxe product each year.The cost of setting up for one production run is $150; the cost of carrying one unit in inventory for a year is $3. A. What is the economic order quantity?
B. What is the annual setup cost of the EOQ policy?
C. What is the annual carrying cost of the EOQ policy?
D. What is the total inventory-related cost of the EOQ policy?
Q3) Refer to the Figure.What is the relationship between absorption-costing net income and variable-costing net income?
A)Absorption-costing net income is $72,000 less.
B)Absorption-costing net income is $70,000 less.
C)Absorption-costing net income is $72,000 greater.
D)Absorption-costing net income is $70,000 greater.
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Chapter 9: Budgeting, production, cash, and Master Budget
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Sample Questions
Q1) Refer to the Figure.How many units of component A are budgeted to be purchased in May?
A)64,500
B)66,600
C)180,000
D)264,300
Q2) What does budgeted operating income include?
A)budgeted interest expense
B)budgeted income taxes
C)budgeted cost of goods sold
D)budgeted net income
Q3) The department manager reviews the budget,provides policy guidelines and budgetary goals,resolves differences that arise as the budget is prepared,approves the final budget,and monitors the actual performance of the organization as the year unfolds.
A)True
B)False
Q4) Briefly describe the attributes of an ideal budgetary system.What features of budgeting have been identified that encourage positive behaviour?
Q5) Does a not-for-profit agency need to budget? Why or why not?
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Chapter 10: Standard Costing: a Managerial Control Tool
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173 Flashcards
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Sample Questions
Q1) Which of the following is NOT characteristic of the use of materials variance information?
A)The production manager has the responsibility for controlling the materials price variance.
B)The production manager is generally responsible for materials usage.
C)The production manager is concerned with minimizing scrap, waste, and rework.
D)The purchasing department is responsible for acquiring quality materials.
Q2) Refer to the Figure.What is the materials price variance?
A)$135,000 U
B)$150,000 F
C)$155,000 F
D)$170,000 U
Q3) Refer to the Figure.What was Perfect Builders' labour rate variance?
A)$240,000 U
B)$240,000 F
C)$280,000 U
D)$280,000 F
Q4) Actual price of inputs is less than the standard price.
A)Favourable variance
B)Unfavourable variance
Page 12
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Chapter 11: Flexible Budgets and Overhead Analysis
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149 Flashcards
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Sample Questions
Q1) Refer to the Figure.Actual costs incurred were $246,000 fixed and $144,000 variable.Suppose the actual number of setups in June was 30.What would be the activity-based flexible budget variance?
A)$12,000 U
B)$12,000 F
C)$15,000 U
D)$15,000 F
Q2) The variable overhead spending variance is conceptually identical to the price variances of materials and labour.
A)True B)False
Q3) Refer to the Figure.What is the variable overhead efficiency variance?
A)$8,300 U
B)$32,000 U
C)$38,300 U
D)$80,000 U
Q4) The volume variance is often interpreted as a measure of capacity utilization.
A)True B)False
Q5) What is a performance report?
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Chapter 12: Performance Evaluation and Decentralization
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Sample Questions
Q1) Economic value added (EVA)can be calculated by multiplying margin by turnover.
A)True
B)False
Q2) Which responsibility centre designation would be used for a production manager?
A)an investment centre
B)a revenue centre
C)a profit centre
D)a cost centre
Q3) Which Balanced Scorecard perspective defines the customer and market segments in which the business unit will compete?
A)the customer perspective
B)the process perspective
C)the learning and growth perspective
D)the financial perspective
Q4) Refer to the Figure.What are the average operating assets for Division B?
A)$5,000
B)$25,000
C)$125,000
D)$208,333
Q5) What are the advantages and disadvantages of return on investment (ROI)?
Page 14
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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) Classify Company has a product that its sales department believes can be sold for $40 each.Classify requires that all new products yield 20% profit.What is the target cost of the new product?
A)$4.00
B)$25.50
C)$26.00
D)$32.00
Q2) What is the term for the act of choosing among alternatives with an immediate or limited end in view?
A)assessing feasible alternatives
B)strategic decision making
C)constructing a decision model
D)short-run decision making
Q3) Refer to the Figure.Assume that EBP can sell as many as 1,000 sinks and 500 tubs per year.How many tubs should EBP produce?
A)0
B)410
C)500
D)675
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Page 15
Chapter 14: Capital Investment Decisions
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Sample Questions
Q1) Because of the postaudit,managers are more likely to make capital investment decisions in the best interests of the firm.
A)True
B)False
Q2) Which of the following is NOT characteristic of the internal rate of return for a project?
A)If the internal rate of return is less than the required rate of return, the project will be rejected.
B)If the internal rate of return is equal to the required rate of return, the net present value of the project is positive.
C)If the internal rate of return is more than the required rate of return, the project will be accepted.
D)If the internal rate of return is equal to the required rate of return, the net present value of the project is negative.
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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