Test Bank — Financial & Managerial Accounting for Decision Makers, 5th Edition (Hanlon, Magee, Pfeiffer, Kulp & Dragoo, 2023) | All Chapters 1-24 Covered

TEST BANK
Financial & Managerial Accounting for Decision
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Makers
Hanlon, Magee, Pfeiffer, Kulp, Dragoo
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5th Edition
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TEST BANK
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, TABLE OF CONTENTS
Test Bank: Financial & Managerial Accounting for Decision Makers, 5th Edition
By Hanlon, Magee, Pfeiffer, Kulp, Dragoo
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CHAPTER 1 Introducing Financial Accounting

CHAPTER 2 Constructing Financial Statements
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CHAPTER 3 Adjusting Accounts for Financial Statements

CHAPTER 4 Reporting and Analyzing Cash Flows

CHAPTER 5 Analyzing and Interpreting Financial Statements

CHAPTER 6 Reporting and Analyzing Revenues, Receivables, and Operating Income
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CHAPTER 7 Reporting and Analyzing Inventory

CHAPTER 8 Reporting and Analyzing Long-Term Operating Assets
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CHAPTER 9 Reporting and Analyzing Liabilities

Reporting and Analyzing Leases, Pensions, Income Taxes, and Commitments and
CHAPTER 10 Contingencies
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CHAPTER 11 Reporting and Analyzing Stockholders’ Equity

CHAPTER 12 Reporting and Analyzing Financial Investments

CHAPTER 13 Managerial Accounting: Tools for Decision-Making

CHAPTER 14 Cost Behavior, Activity Analysis, and Cost Estimation
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CHAPTER 15 Cost-Volume-Profit Analysis and Planning

CHAPTER 16 Using Relevant Costs and Differential Analysis for Decision-Making

CHAPTER 17 Product Costing: Job and Process Operations
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CHAPTER 18 Activity-Based Costing, Customer Profitability, and Activity-Based Management

CHAPTER 19 Additional Topics in Product Costing

CHAPTER 20 Decision-Making: Pricing and Product Cost Management
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CHAPTER 21 Operational Budgeting and Profit Planning

CHAPTER 22 Standard Costs and Performance Reports

Performance Measurement Using Segment Reporting, Transfer Pricing, and
CHAPTER 23 Balanced Scorecard
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CHAPTER 24 Capital Budgeting Decisions

, Chapter 1
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Introducing Financial Accounting
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Learning Objectives – Coverage by question
Multiple Essay
True/False Choice Exercises Problems Questions
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LO1-1 Identify the users of
accounting information and
1, 2 1-3 1, 2 2, 5, 6
discuss the costs and benefits of
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disclosure. (p. 1-3)

LO1-2 Describe a company's
business activities and explain
how these activities are 3-6 4, 5 3 1, 6
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represented by the accounting
equation. (p. 1-7)

LO1-3 Introduce the four key
financial statements including the
balance sheet, income statement,
7-9 4, 6-11 4-11 1-5
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statement of stockholders' equity,
and statement of cash flows.
(p. 1-11)

LO1-4 Describe the institutions
that regulate financial accounting
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and their role in establishing 10-12 12, 19, 20 3, 4
generally accepted accounting
principles. (p. 1-16)

LO1-5 Compute two key ratios
that are commonly used to
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assess profitability and risk - 13, 14 13-18 13, 14
return on equity and the debt-to-
equity ratio. (p. 1-21)

LO1-6 Appendix 1A: Explain the
conceptual framework for 15, 16 21, 22 12 3, 5
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financial reporting. (p. 1-25)




© Cambridge Business Publishers, 2024

, Chapter 1: Introducing Financial Accounting
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True/False


Topic: Cost and benefits of disclosure
LO: 1
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1. One reason companies are motivated to disclose financial information to external decision makers is
that it may lower financing and operating costs.

Answer: True
Rationale: For example, when a company applies for a loan, the bank uses the company’s financial
statements to help determine the appropriate interest rate. Without this financial information, a company
may have a higher cost of borrowing or not obtain the loan at all.
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Topic: Demand for accounting information
LO: 1
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2. Financial accounting is designed primarily for decision makers within the company.

Answer: False
Rationale: Financial accounting is designed primarily to provide information to decision makers outside
of the company, while managerial accounting is designed primarily for decision makers within the
company.
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Topic: Investing activities
LO: 2
3. Investing activities are the acquiring and disposing of liabilities that a company needs in order to finance
its operating activities.
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Answer: False
Rationale: Investing activities are the acquiring and disposing of assets that a company needs for the
production and sale of a company’s products and services.
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Topic: Accounting equation
LO: 2
4. Assets must always equal liabilities plus stockholders’ equity.

Answer: True
Rationale: The accounting equation is Assets = Liabilities + Stockholders’ Equity. This relation must
always stay in balance.
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© Cambridge Business Publishers, 2024
Test Bank, Chapter 1