TEST BANK
Horngren's Cost Accounting: A Managerial Emphasis, Canadian Edition, 10th
edition
by Srikant Datar, Madhav Rajan
TU
TO
R
G
U
R
U
, TABLE OF CONTENT
The Accountant's Vital Role in Decision Making
An Introduction to Cost Terms and Purposes
Cost–Volume–Profit Analysis
Job Costing
Activity-Based Costing and Management
Master Budget and Responsibility Accounting
TU
Flexible Budgets, Variances, and Management Control: I
Flexible Budgets, Variances, and Management Control: II
Income Effects of Denominator Level on Inventory Valuation
Analysis of Cost Behaviour
TO
Decision Making and Relevant Information
Data Analytic Thinking and Prediction
Pricing Decisions: Profitability and Cost Management
R
Strategy, the Balanced Scorecard, and Profitability Analysis
Period Cost Application
G
Cost Allocation: Joint Products and Byproducts
Revenue and Customer Profitability Analysis
U
Process Costing
Spoilage, Rework, and Scrap
R
Inventory Cost Management Strategies
Capital Budgeting: Methods of Investment Analysis
U
Transfer Pricing and Multinational Management Control Systems
Multinational Performance Measurement and Compensation
,Cost Accounting: A Managerial Emphasis, 10Ce (Datar)
Chapter 1 The Accountant's Vital Role in Decision Making
1.1 Explain how management accounting data are essential to the process of rational operating
and strategic decision making
1) Cost accounting is guided by generally accepted accounting principles.
Answer: FALSE
TU
Diff: 1 Type: TF
CPA Competencies: Chapter 1 -
3.1.1 Evaluates management information requirements,
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
3.1.4 Identifies ethical and privacy issues related to information technology
Skill: Remembering
Objective: LO 1-1
TO
2) Managerial accounting and financial accounting both measure and report financial and non-financial
information related to the cost of acquiring or utilizing resources.
Answer: FALSE
Diff: 1 Type: TF
CPA Competencies: Chapter 1 -
3.1.1 Evaluates management information requirements,
R
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
3.1.4 Identifies ethical and privacy issues related to information technology
Skill: Remembering
G
Objective: LO 1-1
3) Cost accounting provides information only for financial accounting.
Answer: FALSE
U
Diff: 1 Type: TF
CPA Competencies: Chapter 1 -
3.1.1 Evaluates management information requirements,
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
R
3.1.4 Identifies ethical and privacy issues related to information technology
Skill: Remembering
Objective: LO 1-1
U
4) Financial accountants are required to follow the generally accepted accounting principles that are used
for external financial reporting when preparing reports for internal users.
Answer: TRUE
Diff: 2 Type: TF
CPA Competencies: Chapter 1 -
3.1.1 Evaluates management information requirements,
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
3.1.4 Identifies ethical and privacy issues related to information technology
Skill: Remembering
Objective: LO 1-1
, 5) Managers typically receive reports on cost planning and controls that should be considered for external
use only.
Answer: FALSE
Diff: 2 Type: TF
CPA Competencies: Chapter 1 -
3.1.1 Evaluates management information requirements,
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
3.1.4 Identifies ethical and privacy issues related to information technology
Skill: Remembering
TU
Objective: LO 1-1
6) There are three (3) basic business strategies: low cost, premium products, and customer satisfaction.
Answer: FALSE
Diff: 1 Type: TF
CPA Competencies: Chapter 1 -
TO
3.1.1 Evaluates management information requirements,
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
3.1.4 Identifies ethical and privacy issues related to information technology
Skill: Remembering
Objective: LO 1-1
7) Companies with a strategy of low prices compete on their ability to offer unique new products or
R
services that are priced higher than their competition.
Answer: FALSE
Diff: 1 Type: TF
CPA Competencies: Chapter 1 -
G
3.1.1 Evaluates management information requirements,
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
3.1.4 Identifies ethical and privacy issues related to information technology
U
Skill: Remembering
Objective: LO 1-1
8) Cost management only involves short-term decisions that attempt to increase value for customers and
R
lower the costs of products or services.
Answer: FALSE
Diff: 1 Type: TF
CPA Competencies: Chapter 1 -
U
3.1.1 Evaluates management information requirements,
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
3.1.4 Identifies ethical and privacy issues related to information technology
Skill: Remembering
Objective: LO 1-1
Horngren's Cost Accounting: A Managerial Emphasis, Canadian Edition, 10th
edition
by Srikant Datar, Madhav Rajan
TU
TO
R
G
U
R
U
, TABLE OF CONTENT
The Accountant's Vital Role in Decision Making
An Introduction to Cost Terms and Purposes
Cost–Volume–Profit Analysis
Job Costing
Activity-Based Costing and Management
Master Budget and Responsibility Accounting
TU
Flexible Budgets, Variances, and Management Control: I
Flexible Budgets, Variances, and Management Control: II
Income Effects of Denominator Level on Inventory Valuation
Analysis of Cost Behaviour
TO
Decision Making and Relevant Information
Data Analytic Thinking and Prediction
Pricing Decisions: Profitability and Cost Management
R
Strategy, the Balanced Scorecard, and Profitability Analysis
Period Cost Application
G
Cost Allocation: Joint Products and Byproducts
Revenue and Customer Profitability Analysis
U
Process Costing
Spoilage, Rework, and Scrap
R
Inventory Cost Management Strategies
Capital Budgeting: Methods of Investment Analysis
U
Transfer Pricing and Multinational Management Control Systems
Multinational Performance Measurement and Compensation
,Cost Accounting: A Managerial Emphasis, 10Ce (Datar)
Chapter 1 The Accountant's Vital Role in Decision Making
1.1 Explain how management accounting data are essential to the process of rational operating
and strategic decision making
1) Cost accounting is guided by generally accepted accounting principles.
Answer: FALSE
TU
Diff: 1 Type: TF
CPA Competencies: Chapter 1 -
3.1.1 Evaluates management information requirements,
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
3.1.4 Identifies ethical and privacy issues related to information technology
Skill: Remembering
Objective: LO 1-1
TO
2) Managerial accounting and financial accounting both measure and report financial and non-financial
information related to the cost of acquiring or utilizing resources.
Answer: FALSE
Diff: 1 Type: TF
CPA Competencies: Chapter 1 -
3.1.1 Evaluates management information requirements,
R
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
3.1.4 Identifies ethical and privacy issues related to information technology
Skill: Remembering
G
Objective: LO 1-1
3) Cost accounting provides information only for financial accounting.
Answer: FALSE
U
Diff: 1 Type: TF
CPA Competencies: Chapter 1 -
3.1.1 Evaluates management information requirements,
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
R
3.1.4 Identifies ethical and privacy issues related to information technology
Skill: Remembering
Objective: LO 1-1
U
4) Financial accountants are required to follow the generally accepted accounting principles that are used
for external financial reporting when preparing reports for internal users.
Answer: TRUE
Diff: 2 Type: TF
CPA Competencies: Chapter 1 -
3.1.1 Evaluates management information requirements,
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
3.1.4 Identifies ethical and privacy issues related to information technology
Skill: Remembering
Objective: LO 1-1
, 5) Managers typically receive reports on cost planning and controls that should be considered for external
use only.
Answer: FALSE
Diff: 2 Type: TF
CPA Competencies: Chapter 1 -
3.1.1 Evaluates management information requirements,
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
3.1.4 Identifies ethical and privacy issues related to information technology
Skill: Remembering
TU
Objective: LO 1-1
6) There are three (3) basic business strategies: low cost, premium products, and customer satisfaction.
Answer: FALSE
Diff: 1 Type: TF
CPA Competencies: Chapter 1 -
TO
3.1.1 Evaluates management information requirements,
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
3.1.4 Identifies ethical and privacy issues related to information technology
Skill: Remembering
Objective: LO 1-1
7) Companies with a strategy of low prices compete on their ability to offer unique new products or
R
services that are priced higher than their competition.
Answer: FALSE
Diff: 1 Type: TF
CPA Competencies: Chapter 1 -
G
3.1.1 Evaluates management information requirements,
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
3.1.4 Identifies ethical and privacy issues related to information technology
U
Skill: Remembering
Objective: LO 1-1
8) Cost management only involves short-term decisions that attempt to increase value for customers and
R
lower the costs of products or services.
Answer: FALSE
Diff: 1 Type: TF
CPA Competencies: Chapter 1 -
U
3.1.1 Evaluates management information requirements,
3.1.2 Evaluates the types of information systems used and the role they play in an organization,
3.1.4 Identifies ethical and privacy issues related to information technology
Skill: Remembering
Objective: LO 1-1
