Test Bank for Managerial Accounting 4th Edition By Charles Davis & Elizabeth Davis, ISBN: 9781119577669, All 13 Chapters Covered, Verified Latest Edition

1-1 Test Bank for Davis & Davis, Managerial Accounting, 4/
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TEST BANK
Managerial Accounting 4th Edition
By Charles Davis Elizabeth Davis Chapter 1 - 13

, 1-2 Test Bank for Davis & Davis, Managerial Accounting, 4/
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Table Of Contents QW QW




1. Accounting as a Tool for Management
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2.Cost Behavior and Cost Estimation
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3. Cost-Volume-Profit Analysis and Pricing Decisions
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4. Product Costs and Job Order Costing
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5. Planning and Forecasting
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5A: Planning and Forecasting in a Retail Setting* (online only)
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6. Performance Evaluation: Variance Analysis
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7. Activity-Based Costing and Activity-Based Management
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8. Using Accounting Information to Make Managerial Decisions
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9. Capital Budgeting
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10. Decentralization and Performance Evaluation
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11. Performance Evaluation Revisited: A Balanced Approach
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12. Financial Statement Analysis
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13. Statement of Cash Flows
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Chapter 1 QW




Accounting as a Tool for Management QW QW QW QW QW




CHAPTER LEARNING OBJECTIVES QW QW




1. Define managerial accounting (Unit 1.1) QW QW QW QW




There are several formal definitions of managerial accounting. A simple one is “th
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egeneration of relevant information to support management’s decision-
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making activities.” QW




2. Describe the differences between managerial and financial accounting
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(Unit 1.1) QW




Managerial accounting’s primary users are managers and decision makers within an or
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ganization, whereas financial accounting is aimed primarily at external users. Unlike GA
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AP that guides financial accounting, there are no mandated rules in managerial accoun
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ting. Managerial accounting reports focus on operating segments, while financialaccou
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nting statements report results for the organization as a whole. Managerial accounting
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is concerned more with projecting future results than reporting past results. Manageria
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l information is prepared to take advantage of a window of opportunity, evenif some a
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ccuracy must be sacrificed. Financial accounting information is balanced to the penny a
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nd is delivered after the end of the accounting period.
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3. List and describe the four functions of managers (Unit 1.1)
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Planning means setting a direction for the organization. Long-
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term, or strategic planningprovides direction for a five- to ten-year period. Short-
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term or operational planning provides more detailed guidance for the coming year; it t
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ranslates the company’s strategy into action steps. Controlling is the monitoring of day
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-to-
day operations to identify any problems that require corrective action. Evaluating is th
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e process of comparing a particular period’s actual results to planned results, for the p
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urpose of assessing managerial performance. Decision making means choosing betwee
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n alternative courses of action.
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4. Explain how the selection of a particular business strategy determines the
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information that managers need to run an organization effectively (Unit 1 QW QW QW QW QW QW QW QW QW QW




.2)
To run a business effectively, managers need information that shows how well oper
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ations are meeting the organization’s strategic goals. For instance, if the organizatio
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n’s strategy is to be a low-
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cost producer, information about product costsand cost variances will be more usef
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ul to managers than information about researchand development.
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5. Discuss the importance of ethical behavior in managerial accounting (Unit
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1.3)
Ethical behavior means knowing right from wrong and then doing the right thing. Man
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ycompanies and most professional organizations have codes of conduct to guide empl
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oyees’ actions. Acting unethically can lead to illegal activity and ultimately to the destr
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uction of the firm. Furthermore, research has shown that a public commitment toethi
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cal behavior can lead to superior financial performance.
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