1-1 Test Bank for Davis & Davis, Managerial Accounting, 4/e
TESTBANK
ManagerialAccounting4thEdition
ByCharles Davis Elizabeth Davis Chapter 1 - 13
https://www.stuvia.com/user/Brainbox
, 1-2 Test Bank for Davis & Davis, Managerial Accounting, 4/e
Table Of Contents
1. Accounting as a Tool for Management
2. Cost Behavior and Cost Estimation
3. Cost-Volume-Profit Analysis and Pricing Decisions
4. Product Costs and Job Order Costing
5. Planning and Forecasting
5A: Planning and Forecasting in a Retail Setting* (online only)
6. Performance Evaluation: Variance Analysis
7. Activity-Based Costing and Activity-Based Management
8. Using Accounting Information to Make Managerial Decisions
9. Capital Budgeting
10. Decentralization and Performance Evaluation
11. Performance Evaluation Revisited: A Balanced Approach
12. Financial Statement Analysis
13. Statement of Cash Flows
https://www.stuvia.com/user/Brainbox
, 1-3 Test Bank for Davis & Davis, Managerial Accounting, 4/e
Chapter 1
Accounting as a Tool for Management
CHAPTER LEARNING OBJECTIVES
1. Define managerial accounting (Unit 1.1)
There are several formal definitions of managerial accounting. A simple one is
“thegeneration of relevant information to support management’s decision-
making activities.”
2. Describe the differences between managerial and financial accounting(Unit
1.1)
Managerial accounting’s primary users are managers and decision makers within an
organization, whereas financial accounting is aimed primarily at external users. Unlike
GAAP that guides financial accounting, there are no mandated rules in managerial
accounting. Managerial accounting reports focus on operating segments, while
financial accounting statements report results for the organization as a whole.
Managerial accounting is concerned more with projecting future results than reporting
past results. Managerial information is prepared to take advantage of a window of
opportunity, even if some accuracy must be sacrificed. Financial accounting information
is balanced to the penny and is delivered after the end of the accounting period.
3. List and describe the four functions of managers (Unit 1.1) Planning means setting a
direction for the organization. Long-term, or strategic planningprovides direction for a
five- to ten-year period. Short-term or operational planning provides more detailed
guidance for the coming year; it translates the company’s strategy into action steps.
https://www.stuvia.com/user/Brainbox
, 1-4 Test Bank for Davis & Davis, Managerial Accounting, 4/e
Controlling is the monitoring of day-to-day operations to identify any problems that
require corrective action. Evaluating is the process of comparing a particular period’s
actual results to planned results, for the purpose of assessing managerial performance.
Decision making means choosing between alternative courses of action.
4. Explain how the selection of a particular business strategy determines
theinformation that managers need to run an organization effectively (Unit
1.2)
To run a business effectively, managers need information that shows how well
operations are meeting the organization’s strategic goals. For instance, if the
organization’s strategy is to be a low-cost producer, information about product
costsand cost variances will be more useful to managers than information about
researchand development.
https://www.stuvia.com/user/Brainbox
TESTBANK
ManagerialAccounting4thEdition
ByCharles Davis Elizabeth Davis Chapter 1 - 13
https://www.stuvia.com/user/Brainbox
, 1-2 Test Bank for Davis & Davis, Managerial Accounting, 4/e
Table Of Contents
1. Accounting as a Tool for Management
2. Cost Behavior and Cost Estimation
3. Cost-Volume-Profit Analysis and Pricing Decisions
4. Product Costs and Job Order Costing
5. Planning and Forecasting
5A: Planning and Forecasting in a Retail Setting* (online only)
6. Performance Evaluation: Variance Analysis
7. Activity-Based Costing and Activity-Based Management
8. Using Accounting Information to Make Managerial Decisions
9. Capital Budgeting
10. Decentralization and Performance Evaluation
11. Performance Evaluation Revisited: A Balanced Approach
12. Financial Statement Analysis
13. Statement of Cash Flows
https://www.stuvia.com/user/Brainbox
, 1-3 Test Bank for Davis & Davis, Managerial Accounting, 4/e
Chapter 1
Accounting as a Tool for Management
CHAPTER LEARNING OBJECTIVES
1. Define managerial accounting (Unit 1.1)
There are several formal definitions of managerial accounting. A simple one is
“thegeneration of relevant information to support management’s decision-
making activities.”
2. Describe the differences between managerial and financial accounting(Unit
1.1)
Managerial accounting’s primary users are managers and decision makers within an
organization, whereas financial accounting is aimed primarily at external users. Unlike
GAAP that guides financial accounting, there are no mandated rules in managerial
accounting. Managerial accounting reports focus on operating segments, while
financial accounting statements report results for the organization as a whole.
Managerial accounting is concerned more with projecting future results than reporting
past results. Managerial information is prepared to take advantage of a window of
opportunity, even if some accuracy must be sacrificed. Financial accounting information
is balanced to the penny and is delivered after the end of the accounting period.
3. List and describe the four functions of managers (Unit 1.1) Planning means setting a
direction for the organization. Long-term, or strategic planningprovides direction for a
five- to ten-year period. Short-term or operational planning provides more detailed
guidance for the coming year; it translates the company’s strategy into action steps.
https://www.stuvia.com/user/Brainbox
, 1-4 Test Bank for Davis & Davis, Managerial Accounting, 4/e
Controlling is the monitoring of day-to-day operations to identify any problems that
require corrective action. Evaluating is the process of comparing a particular period’s
actual results to planned results, for the purpose of assessing managerial performance.
Decision making means choosing between alternative courses of action.
4. Explain how the selection of a particular business strategy determines
theinformation that managers need to run an organization effectively (Unit
1.2)
To run a business effectively, managers need information that shows how well
operations are meeting the organization’s strategic goals. For instance, if the
organization’s strategy is to be a low-cost producer, information about product
costsand cost variances will be more useful to managers than information about
researchand development.
https://www.stuvia.com/user/Brainbox
