Question 1

In a manufacturing company,an accountant's salary is a value-adding cost.

Accepted Answer

A) True 
 B)False

Question 2

A materials request form is prepared whenever the purchasing department orders materials.

Accepted Answer

A) True 
 B)False

Question 3

A production cost is classified as an overhead cost if it is not directly traceable to an end product or a cost object.

Accepted Answer

A) True 
 B)False

Question 4

The key to the preparation of an income statement for a manufacturing company is proper determination of the cost of goods manufactured.

Accepted Answer

A) True 
 B)False

Question 5

If the report is urgently needed,it is sometimes necessary to sacrifice accuracy in the interest of

Accepted Answer

A)  timeliness
B)  personal feelings.
C)  profits.
D)  expectations.E) All of the above
F) A) and D)

Question 6

Cost of goods manufactured is equal to

Accepted Answer

A)  Direct Materials + Direct Labor + Overhead.
B)  Beginning Work in Process Inventory + Total Manufacturing Costs - Ending Work in Process Inventory.
C)  Beginning Work in Process Inventory + Period Costs - Ending Work in Process Inventory.
D)  Beginning Work in Process Inventory + Product Costs.E) B) and C)
F) All of the above

Question 7

The unit of measurement used in management accounting reports is

Accepted Answer

A)  primarily the historical dollar.
B)  usually current replacement cost.
C)  any measurement unit that is useful in a particular situation.
D)  the measurement unit used by competing companies.E) A) and B)
F) A) and C)

Question 8

The fundamental way in which a company will achieve its goal is described in its

Accepted Answer

A)  balance sheet and income statement.
B)  cash flow statement.
C)  budget.
D)  mission statement.E) A) and D)
F) C) and D)

Question 9

The product costs that appear in the financial statements are estimated product costs.

Accepted Answer

A) True 
 B)False

Question 10

The overall guideline or limit for management accounting information is that the report or analysis must be meaningful and must answer the questions or issues under review.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following represents normal cost measurement?

Accepted Answer

A)  Actual Direct Materials + Actual Direct Labor + Actual Overhead
B)  Actual Direct Materials + Actual Direct Labor + Estimated Overhead
C)  Estimated Direct Materials + Estimated Direct Labor + Actual Overhead
D)  Actual Direct Materials + Estimated Direct Labor + Estimated OverheadE) B) and D)
F) All of the above

Question 12

Management accounting information demands more objectivity than financial accounting information.

Accepted Answer

A) True 
 B)False

Question 13

Although some management accountants strive to update their knowledge and skills,such updating is within the realm of management accountants' ethical standards.

Accepted Answer

A) True 
 B)False

Question 14

Management accounting complements each stage of the management process.

Accepted Answer

A) True 
 B)False

Question 15

The costs of marketing and delivering a product are recorded in the Work in Process Inventory account.

Accepted Answer

A) True 
 B)False

Question 16

Management accountants who alter reports to meet targeted levels of performance are not acting unethically,because their job is to provide information that will aid in communicating the goals of the business.

Accepted Answer

A) True 
 B)False

Question 17

Management accountants are obligated to refrain from activities that would prejudice their ability to carry out their duties.

Accepted Answer

A) True 
 B)False

Question 18

Materials costs flow from the Materials Inventory account to the Work in Process Inventory account to the Finished Goods Inventory account.

Accepted Answer

A) True 
 B)False

Question 19

A business plan is a comprehensive statement of how a company will achieve its objectives.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following is not a reason to classify costs as either product or period costs?

Accepted Answer

A)  To determine unit manufacturing costs
B)  To determine if the costs are fixed or variable
C)  To analyze costs for control purposes
D)  To report production costs on the income statementE) None of the above
F) A) and C)

Exam 15: Managerial Accounting and Cost Concepts

The fundamental way in which a company will achieve its goal is described in its

Correct AnswerverifiedShow Answer

A materials request form is prepared whenever the purchasing department orders materials.

Correct AnswerverifiedShow Answer

A business plan is a comprehensive statement of how a company will achieve its objectives.

Correct AnswerverifiedShow Answer

The unit of measurement used in management accounting reports is

Correct AnswerverifiedShow Answer

A production cost is classified as an overhead cost if it is not directly traceable to an end product or a cost object.

Correct AnswerverifiedShow Answer

Which of the following is not a reason to classify costs as either product or period costs?

Correct AnswerverifiedShow Answer

Materials costs flow from the Materials Inventory account to the Work in Process Inventory account to the Finished Goods Inventory account.

Correct AnswerverifiedShow Answer

The key to the preparation of an income statement for a manufacturing company is proper determination of the cost of goods manufactured.

Correct AnswerverifiedShow Answer

Management accounting information demands more objectivity than financial accounting information.

Correct AnswerverifiedShow Answer

Management accountants are obligated to refrain from activities that would prejudice their ability to carry out their duties.

Correct AnswerverifiedShow Answer

Although some management accountants strive to update their knowledge and skills,such updating is within the realm of management accountants' ethical standards.

Correct AnswerverifiedShow Answer

In a manufacturing company,an accountant's salary is a value-adding cost.

Correct AnswerverifiedShow Answer

Cost of goods manufactured is equal to

Correct AnswerverifiedShow Answer

The overall guideline or limit for management accounting information is that the report or analysis must be meaningful and must answer the questions or issues under review.

Correct AnswerverifiedShow Answer

Management accounting complements each stage of the management process.

Correct AnswerverifiedShow Answer

If the report is urgently needed,it is sometimes necessary to sacrifice accuracy in the interest of

Correct AnswerverifiedShow Answer

The costs of marketing and delivering a product are recorded in the Work in Process Inventory account.

Correct AnswerverifiedShow Answer

Management accountants who alter reports to meet targeted levels of performance are not acting unethically,because their job is to provide information that will aid in communicating the goals of the business.

Correct AnswerverifiedShow Answer

Which of the following represents normal cost measurement?

Correct AnswerverifiedShow Answer

The product costs that appear in the financial statements are estimated product costs.

Correct AnswerverifiedShow Answer

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