COST ACCOUNTING EXAM 1 TERMS Questions
and Answers Updated 2026
# Term Definition
1 Planning
information regarding future costs and actions (eg
budgeting)
2 Control
monitoring a plan's implementation and taking corrective
action
3 Decision making choosing among competing alternatives
4 ERP Enterprise resource planning
5 Customer value = what customer receives - what customer gives up
6 Value Chain -design -develop -produce -market -deliver
7 Total Quality Management
"acceptable quality" no longer OK. Total quality = zero
defects.
8 Effectiveness doing the right thing
9 Efficiency doing the right thing well
10 Cost is a measure of efficiency
11 Line -production -sales
12 Staff -support the line positions -accountants are staff
, 13 Controller
Chief Accounting Officer -internal auditing -cost
accounting -financial reporting and systems
14 Treasurer
responsible for finance function. -raise capital and
manage cash and investments -responsible for credit &
collection and insurance
15 Sarbanes-Oxley Act of 2002
-passed by Congress in response to corporate securities
frauds and corporate misconduct -established stronger
government control & regulation of public companies\ -
more attention to corporate ethics
# Term Definition
16 Exchange Relationships examples
-organization-customer -boss-subordinate
-company-supplier
17 Ethical Problem Areas
-Unequal power relationships -financial quandaries -
cover-ups -ignoring responsibility
18 Heuristics for Ethical Decision Making
-the golden rule -the professional ethic -the Public
Perception test -Kant's categorical imperative (acting in a
way that would be a universal law of behavior for
everyone facing those circumstances) -the legality test
(legal doesn't mean ethical)
19
IMA - Statement of Ethical Professional -competence -confidentiality -integrity -credibility
Practice -resolution of ethical conflict
20 CMA Certified Management Accountant
21 CIA Certified Internal Auditor
22 Accounting Information System
Collects and processes data to provide information to
users
and Answers Updated 2026
# Term Definition
1 Planning
information regarding future costs and actions (eg
budgeting)
2 Control
monitoring a plan's implementation and taking corrective
action
3 Decision making choosing among competing alternatives
4 ERP Enterprise resource planning
5 Customer value = what customer receives - what customer gives up
6 Value Chain -design -develop -produce -market -deliver
7 Total Quality Management
"acceptable quality" no longer OK. Total quality = zero
defects.
8 Effectiveness doing the right thing
9 Efficiency doing the right thing well
10 Cost is a measure of efficiency
11 Line -production -sales
12 Staff -support the line positions -accountants are staff
, 13 Controller
Chief Accounting Officer -internal auditing -cost
accounting -financial reporting and systems
14 Treasurer
responsible for finance function. -raise capital and
manage cash and investments -responsible for credit &
collection and insurance
15 Sarbanes-Oxley Act of 2002
-passed by Congress in response to corporate securities
frauds and corporate misconduct -established stronger
government control & regulation of public companies\ -
more attention to corporate ethics
# Term Definition
16 Exchange Relationships examples
-organization-customer -boss-subordinate
-company-supplier
17 Ethical Problem Areas
-Unequal power relationships -financial quandaries -
cover-ups -ignoring responsibility
18 Heuristics for Ethical Decision Making
-the golden rule -the professional ethic -the Public
Perception test -Kant's categorical imperative (acting in a
way that would be a universal law of behavior for
everyone facing those circumstances) -the legality test
(legal doesn't mean ethical)
19
IMA - Statement of Ethical Professional -competence -confidentiality -integrity -credibility
Practice -resolution of ethical conflict
20 CMA Certified Management Accountant
21 CIA Certified Internal Auditor
22 Accounting Information System
Collects and processes data to provide information to
users
