Question 1

Which of the following is not a characteristic of financial accounting?

Accepted Answer

A)  Financial reports are prepared according to GAAP.
B)  Information is used by external parties.
C)  Information is subjective,relevant and future-oriented.
D)  Reports are prepared periodically.

Question 2

All manufacturing costs are inventoriable costs.Manufacturing costs are product costs that are assigned to the product as it is being manufactured.Product costs are also called inventoriable costs because they are counted as inventory until the product is finally sold.

Accepted Answer

A) True 
 B)False

Question 3

For a cost to be relevant,it must be

Accepted Answer

A)  a differential cost and a sunk cost.
B)  a differential cost,but not a sunk cost.
C)  a sunk cost,but not a differential cost.
D)  neither a differential cost nor a sunk cost.

Question 4

Prime costs include direct materials,direct labor,and manufacturing overhead.Taken together,direct materials and direct labor are referred to as prime cost.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following changes introduced by the Sarbanes-Oxley Act is not one intended to encourage good character?

Accepted Answer

A)  Anonymous tip lines
B)  Whistle-blower protection
C)  Code of ethics
D)  Stiffer fines and prison terms

Question 6

Which of the following changes introduced by the Sarbanes-Oxley Act is not one intended to reduce opportunities for error and fraud?

Accepted Answer

A)  Internal control report from management
B)  Code of ethics
C)  Stronger oversight by directors
D)  Internal control audit by external auditors

Question 7

Which of the following is the correct sequencing of the managerial process?

Accepted Answer

A)  Planning - Organizing - Control - Directing/Leading
B)  Planning - Directing/Leading - Organizing - Control
C)  Planning - Organizing - Directing/Leading - Control
D)  Organizing - Directing/Leading - Planning - Control

Question 8

Although there are numerous ways to categorize costs,each individual cost will only be classified in one particular way.A single cost can be classified in more than one way,depending on how the information will be used.

Accepted Answer

A) True 
 B)False

Question 9

Financial accounting information is prepared according to generally accepted accounting principles.External financial statements are required to be prepared according to GAAP.

Accepted Answer

A) True 
 B)False

Question 10

An actual outlay of cash is a(n)

Accepted Answer

A)  out-of-pocket cost.
B)  opportunity cost.
C)  direct cost.
D)  cost object.

Question 11

A cost object is

Accepted Answer

A)  an item for which managers are trying to determine the cost.
B)  an item to which managers must directly trace costs.
C)  an item to which it is not worth the effort of tracing costs.
D)  an item for sale by a business.

Question 12

Since hospitals,universities,and charitable organizations do not exist strictly to earn profit for shareholders,managerial accounting information is not vital to their operations.Managerial accounting information is vital to nonprofit organizations,including hospitals,universities,and charitable organizations.Although these organizations do not exist strictly to earn profit for shareholders,their managers still need managerial accounting information to prepare budgets,manage resources,and make strategic and operational decisions.

Accepted Answer

A) True 
 B)False

Question 13

Investors,creditors and regulators are the primary users of managerial accounting information.Managerial accounting information is used by internal business owners and managers.

Accepted Answer

A) True 
 B)False

Question 14

Conversion costs can be defined as

Accepted Answer

A)  Manufacturing costs plus non-manufacturing costs.
B)  Direct labor plus direct materials.
C)  Variable costs plus fixed costs.
D)  Manufacturing costs minus direct materials.

Question 15

An opportunity cost is

Accepted Answer

A)  the foregone benefit of the path not taken.
B)  an actual outlay of cash.
C)  the initial investment required to pursue an opportunity.
D)  a cost that cannot be traced to a specific cost object.

Question 16

Robin Company has the following balances for the current month: What are Robin's conversion costs?

Accepted Answer

A)  $70,400
B)  $60,800
C)  $91,200
D)  $57,600

Question 17

Out-of-pocket costs involve an actual outlay of cash.Out-of-pocket costs are those paid for items purchased,and involve an actual outlay of cash.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following functions of management involves taking corrective action if needed?

Accepted Answer

A)  Planning
B)  Organizing
C)  Directing/leading
D)  Control

Question 19

GAAP reporting rules require that all manufacturing costs be treated as

Accepted Answer

A)  period costs.
B)  product costs.
C)  value-added costs.
D)  relevant costs.

Question 20

Manufacturing costs are generally classified into which of the following categories?

Accepted Answer

A)  relevant costs and irrelevant costs
B)  direct materials,direct labor,and manufacturing overhead
C)  prime costs and conversion costs
D)  conversion costs,marketing costs,and administrative costs

Exam 1: Introduction to Managerial Accounting

Correct Answer
verified

All manufacturing costs are inventoriable costs.Manufacturing costs are product costs that are assigned to the product as it is being manufactured.Product costs are also called inventoriable costs because they are counted as inventory until the product is finally sold.

Correct Answer
verified

GAAP reporting rules require that all manufacturing costs be treated as

Correct Answer
verified

Which of the following is not a characteristic of financial accounting?

Correct Answer
verified

Which of the following changes introduced by the Sarbanes-Oxley Act is not one intended to encourage good character?

Correct Answer
verified

Out-of-pocket costs involve an actual outlay of cash.Out-of-pocket costs are those paid for items purchased,and involve an actual outlay of cash.

Correct Answer
verified

Robin Company has the following balances for the current month: What are Robin's conversion costs?

Correct Answer
verified

Prime costs include direct materials,direct labor,and manufacturing overhead.Taken together,direct materials and direct labor are referred to as prime cost.

Correct Answer
verified

An actual outlay of cash is a(n)

Correct Answer
verified

Manufacturing costs are generally classified into which of the following categories?

Correct Answer
verified

Which of the following is the correct sequencing of the managerial process?

Correct Answer
verified

An opportunity cost is

Correct Answer
verified

Although there are numerous ways to categorize costs,each individual cost will only be classified in one particular way.A single cost can be classified in more than one way,depending on how the information will be used.

Correct Answer
verified

Conversion costs can be defined as

Correct Answer
verified

Financial accounting information is prepared according to generally accepted accounting principles.External financial statements are required to be prepared according to GAAP.

Correct Answer
verified

Which of the following functions of management involves taking corrective action if needed?

Correct Answer
verified

For a cost to be relevant,it must be

Correct Answer
verified

A cost object is

Correct Answer
verified

Which of the following changes introduced by the Sarbanes-Oxley Act is not one intended to reduce opportunities for error and fraud?

Correct Answer
verified

Investors,creditors and regulators are the primary users of managerial accounting information.Managerial accounting information is used by internal business owners and managers.

Correct Answer
verified

Exam 1: Introduction to Managerial Accounting

Correct AnswerverifiedShow Answer

All manufacturing costs are inventoriable costs.Manufacturing costs are product costs that are assigned to the product as it is being manufactured.Product costs are also called inventoriable costs because they are counted as inventory until the product is finally sold.

Correct AnswerverifiedShow Answer

GAAP reporting rules require that all manufacturing costs be treated as

Correct AnswerverifiedShow Answer

Which of the following is not a characteristic of financial accounting?

Correct AnswerverifiedShow Answer

Which of the following changes introduced by the Sarbanes-Oxley Act is not one intended to encourage good character?

Correct AnswerverifiedShow Answer

Out-of-pocket costs involve an actual outlay of cash.Out-of-pocket costs are those paid for items purchased,and involve an actual outlay of cash.

Correct AnswerverifiedShow Answer

Robin Company has the following balances for the current month: What are Robin's conversion costs?

Correct AnswerverifiedShow Answer

Prime costs include direct materials,direct labor,and manufacturing overhead.Taken together,direct materials and direct labor are referred to as prime cost.

Correct AnswerverifiedShow Answer

An actual outlay of cash is a(n)

Correct AnswerverifiedShow Answer

Manufacturing costs are generally classified into which of the following categories?

Correct AnswerverifiedShow Answer

Which of the following is the correct sequencing of the managerial process?

Correct AnswerverifiedShow Answer

An opportunity cost is

Correct AnswerverifiedShow Answer

Although there are numerous ways to categorize costs,each individual cost will only be classified in one particular way.A single cost can be classified in more than one way,depending on how the information will be used.

Correct AnswerverifiedShow Answer

Conversion costs can be defined as

Correct AnswerverifiedShow Answer

Financial accounting information is prepared according to generally accepted accounting principles.External financial statements are required to be prepared according to GAAP.

Correct AnswerverifiedShow Answer

Which of the following functions of management involves taking corrective action if needed?

Correct AnswerverifiedShow Answer

For a cost to be relevant,it must be

Correct AnswerverifiedShow Answer

A cost object is

Correct AnswerverifiedShow Answer

Which of the following changes introduced by the Sarbanes-Oxley Act is not one intended to reduce opportunities for error and fraud?

Correct AnswerverifiedShow Answer

Investors,creditors and regulators are the primary users of managerial accounting information.Managerial accounting information is used by internal business owners and managers.

Correct AnswerverifiedShow Answer

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