TEST BANK FOR MANAGERIAL ACCOUNTING 5TH EDITION BY BRAUN

DOWNLOAD THE Test Bank for Managerial Accounting 5th Edition Braun



Managerial Accounting, 5e (Braun et al.)
Chapter 2 Building Blocks of Managerial Accounting

2.1 Distinguish among service, merchandising, and manufacturing companies

1) Service companies must carry a large amount of inventory to meet consumer demand.
Answer: FALSE
Diff: 1
LO: 2-1
EOC: S2-
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.

2) Manufacturing companies usually have three types of inventory.
Answer: TRUE
Diff: 1
LO: 2-1
EOC: S2-2
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.

3) Retailers sell their products to consumers.
Answer: TRUE
Diff: 1
LO: 2-1
EOC: S2-2
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.

4) Merchandising companies include both wholesalers and retailers.
Answer: TRUE
Diff: 1
LO: 2-1
EOC: S2-2
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.

5) All companies have the same types of inventories.
Answer: FALSE
Diff: 1
LO: 2-1
EOC: S2-2
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.




1
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,DOWNLOAD THE Test Bank for Managerial Accounting 5th Edition Braun



6) Only manufacturing companies have finished goods inventory.
Answer: TRUE
Diff: 2
LO: 2-1
EOC: S2-2
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.

7) Which of the following are merchandising companies?
A) Manufacturers
B) Retailers
C) Wholesalers
D) Both retailers and wholesalers
Answer: D
Diff: 1
LO: 2-1
EOC: S2-2
AACSB: Analytical thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.

8) Which of the following types of companies has raw materials, work in process and finished goods
inventory?
A) Retailers
B) Manufacturers
C) Wholesalers
D) Service companies
Answer: B
Diff: 1
LO: 2-1
EOC: S2-2
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.

9) Which type of company makes up the largest sector of the United States economy?
A) Manufacturers
B) Merchandising
C) Wholesalers
D) Service companies
Answer: D
Diff: 1
LO: 2-1
EOC: S2-2
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.




2
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mynursytest.store

,DOWNLOAD THE Test Bank for Managerial Accounting 5th Edition Braun



10) The balance sheet of a service company has
A) raw materials inventory.
B) little or no inventory.
C) three categories of inventory.
D) two categories of inventory.
Answer: B
Diff: 1
LO: 2-1
EOC: S2-1
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.

11) Schlabig & Associates, a public accounting firm that provides business consulting to a consumer, is
what type of company?
A) Manufacturer
B) Retailer
C) Service
D) Wholesaler
Answer: C
Diff: 1
LO: 2-1
EOC: S2-2
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.

12) Jiffy Lube, an automotive maintenance company, is primarily what type of company?
A) Manufacturer
B) Retailer
C) Wholesaler
D) Service
Answer: D
Diff: 1
LO: 2-1
EOC: S2-2
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.

13) Among other products, Nabisco makes Oreo cookies. Which type of company is Nabisco?
A) Service
B) Manufacturer
C) Retailer
D) Wholesaler
Answer: B
Diff: 1
LO: 2-1
EOC: S2-2
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.




3
Copyright © 2018 Pearson Education, Inc.
mynursytest.store

, DOWNLOAD THE Test Bank for Managerial Accounting 5th Edition Braun



14) Which type of company typically produces its own inventory?
A) Manufacturer
B) Service company
C) Retailer
D) Wholesaler
Answer: A
Diff: 1
LO: 2-1
EOC: S2-2
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.

15) Before these materials are used to manufacture its cars, Toyota classifies steel, glass, and plastic as
A) raw materials inventory.
B) finished goods inventory.
C) work in process inventory.
D) merchandise inventory.
Answer: A
Diff: 1
LO: 2-1
EOC: S2-2
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.

16) Before these materials are used to manufacture cabinets, a woodworker classifies lumber, paint, and
glue as
A) finished goods inventory.
B) work in process inventory.
C) raw materials inventory.
D) merchandise inventory.
Answer: C
Diff: 1
LO: 2-1
EOC: S2-2
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.

17) Macy's (the department store chain) classifies its clothing held for sale as
A) merchandise inventory.
B) raw materials inventory.
C) work in process inventory.
D) finished goods inventory.
Answer: A
Diff: 1
LO: 2-1
EOC: S2-2
AACSB: Reflective thinking
Learning Outcome: Describe the basics of managerial accounting and its function within an organization.




4
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