MANAGERIAL ACCOUNTING -- EXAM 1
(CHAPTER 15, 16, 18) QUESTIONS AND
ANSWERS WITH SOLUTIONS 2024
financial accounting - ANSWER info is report3ed at fixed intervals (monthly, quarterly, yearly, in general-
purpose financial statements
managerial accounting - ANSWER designed to meet the specific needs of a company's management
-directing daily operations
-planning future operations
-developing business strategies
historical data - ANSWER provide objective measures of past operations
estimated data - ANSWER provide subjective estimates about future decisions
verticals - ANSWER referred to as business units b/c they're often structured as separate businesses w/in
the parent company
-develop products that are sold directly to customers
horizontals - ANSWER departments w/in the company that aren't responsible for developing products
-provide services to the various verticals and other horizontals
(management process)
1. Planning - ANSWER -used in developing the company's objectives (goals) & translating these
objectives into courses of action
Strategic planning - ANSWER developing long-term actions to achieve the company's objectives
-involve periods of 5-10 years
, Operational planning - ANSWER develops short term actions for managing the day-to-day operations of
the company
(management process)
2. directing - ANSWER process by which managers run day-to-day operations
(management process)
3. controlling - ANSWER monitoring operating results and comparing actual results w/ the expected
results
management by exception - ANSWER the philosophy of controlling by comparing actual and expected
results
(management process)
4. improving - ANSWER continuous process improvement
-the philosophy of continually improving employees, business processes, and products
--objective = to eliminate the source of problems in a process
(management process)
5. decision making - ANSWER inherent in each of the preceding management processes
-in managing a company, management must continually decide among alternative actions
cost - ANSWER a sacrifice made to obtain some benefit
cost object - ANSWER a segment of operations
-may be a product, a sale territory, a department, or an activity (research and development)
direct costs - ANSWER can be identified w/ and traced to a cost object
indirect costs - ANSWER cannot be identified w/ or traced to a cost object
(CHAPTER 15, 16, 18) QUESTIONS AND
ANSWERS WITH SOLUTIONS 2024
financial accounting - ANSWER info is report3ed at fixed intervals (monthly, quarterly, yearly, in general-
purpose financial statements
managerial accounting - ANSWER designed to meet the specific needs of a company's management
-directing daily operations
-planning future operations
-developing business strategies
historical data - ANSWER provide objective measures of past operations
estimated data - ANSWER provide subjective estimates about future decisions
verticals - ANSWER referred to as business units b/c they're often structured as separate businesses w/in
the parent company
-develop products that are sold directly to customers
horizontals - ANSWER departments w/in the company that aren't responsible for developing products
-provide services to the various verticals and other horizontals
(management process)
1. Planning - ANSWER -used in developing the company's objectives (goals) & translating these
objectives into courses of action
Strategic planning - ANSWER developing long-term actions to achieve the company's objectives
-involve periods of 5-10 years
, Operational planning - ANSWER develops short term actions for managing the day-to-day operations of
the company
(management process)
2. directing - ANSWER process by which managers run day-to-day operations
(management process)
3. controlling - ANSWER monitoring operating results and comparing actual results w/ the expected
results
management by exception - ANSWER the philosophy of controlling by comparing actual and expected
results
(management process)
4. improving - ANSWER continuous process improvement
-the philosophy of continually improving employees, business processes, and products
--objective = to eliminate the source of problems in a process
(management process)
5. decision making - ANSWER inherent in each of the preceding management processes
-in managing a company, management must continually decide among alternative actions
cost - ANSWER a sacrifice made to obtain some benefit
cost object - ANSWER a segment of operations
-may be a product, a sale territory, a department, or an activity (research and development)
direct costs - ANSWER can be identified w/ and traced to a cost object
indirect costs - ANSWER cannot be identified w/ or traced to a cost object
