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Cost Accounting, 14e (Horngren/Datar/Rajan)
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Chapter 1 The Accountant's Role in the Organization
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Objective 1.1 bg
1) Management accounting:
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A) focuses on estimating future revenues, costs, and other measures to forecast activities and their
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results
B) provides information about the company as a whole
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C) reports information that has occurred in the past that is verifiable and reliable
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D) provides information that is generally available only on a quarterly or annual basis
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Answer: A b g
Diff: 2 bg
Terms: treasury b g
Objective: 1 b g
AACSB: Reflective thinking b g bg
2) Managers use management accounting information to ________ strategy.
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A) choose
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B) communicate
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C) implement
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D) All of these answers are correct.
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Answer: D b g
Diff: 1 bg
Terms: total quality management (TQM)
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Objective: 1 b g
AACSB: Analytical skills b g bg
3) Financial accounting:
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A) focuses on the future and includes activities such as preparing next year's operating budget
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B) must comply with GAAP (generally accepted accounting principles)
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C) reports include detailed information on the various operating segments of the business such as
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product lines or departments
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D) is prepared for the use of department heads and other employees
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Answer: B b g
Diff: 2 bg
Terms: financial accounting
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Objective: 1 b g
AACSB: Reflective thinking b g bg
1
Copyright © 2012 Pearson Education, Inc.
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4) The person most likely to use ONLY financial accounting information is a:
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A) factory shift supervisor
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B) vice president of operations
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C) current shareholder
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D) department manager
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Answer: C b g
Diff: 1 bg
Terms: financial accounting b g bg
Objective: 1 b g
AACSB: Analytical skills b g bg
5) Which of the following people is LEAST likely to use management accounting information?
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A) the controller
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B) a shareholder evaluating a stock investment
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C) the treasurer
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D) an assembly department supervisor
bg bg bg bg
Answer: B b g
Diff: 1 bg
Terms: treasury b g
Objective: 1 b g
AACSB: Analytical skills b g bg
6) Financial accounting provides the primary source of information for:
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A) decision making in the finishing department
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B) improving customer service
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C) preparing the income statement for shareholders
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D) planning next year's operating budget
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Answer: C b g
Diff: 2 bg
Terms: financial accounting b g bg
Objective: 1 b g
AACSB: Reflective thinking b g bg
7) Which of the following descriptors refers to management accounting information?
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A) It is verifiable and reliable.
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B) It is driven by rules.
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C) It is prepared for shareholders.
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D) It provides reasonable and timely estimates.
bg bg bg bg bg bg
Answer: D b g
Diff: 2 bg
Terms: treasury b g
Objective: 1 b g
AACSB: Reflective thinking b g bg
2
Copyright © 2012 Pearson Education, Inc.
bg bg bg bg bg
,bg
8) Which of the following statements refers to management accounting information?
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A) There are no regulations governing the reports.
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B) The reports are generally delayed and historical.
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C) The audience tends to be stockholders, creditors, and tax authorities.
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D) It primarily measures and records business transactions.
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Answer: A b g
Diff: 2 bg
Terms: treasury b g
Objective: 1 b g
AACSB: Reflective thinking b g bg
9) Which of the following groups would be LEAST likely to receive detailed management accounting
bg bg bg bg bg bg bg bg bg bg bg bg bg bg
reports?
A) stockholders
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B) sales representatives
bg bg
C) production supervisors
bg bg
D) managers
bg
Answer: A b g
Diff: 1 bg
Terms: treasury b g
Objective: 1 b g
AACSB: Analytical skills b g bg
10) Management accounting information includes:
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A) tabulated results of customer satisfaction surveys
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B) the cost of producing a product
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C) the percentage of units produced that are defective
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D) All of these answers are correct.
bg bg bg bg bg bg
Answer: D b g
Diff: 1 bg
Terms: treasury b g
Objective: 1 b g
AACSB: Reflective thinking b g bg
11) Cost accounting:
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A) provides information on the efficiency of factory labor
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B) provides information on the cost of servicing commercial customers
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C) provides information on the performance of an operating division
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D) All of these answers are correct.
bg bg bg bg bg bg
Answer: D b g
Diff: 1 bg
Terms: cost accounting b g bg
Objective: 1 b g
AACSB: Reflective thinking b g bg
3
Copyright © 2012 Pearson Education, Inc. bg bg bg bg bg
,bg
Cost Accounting, 14e (Horngren/Datar/Rajan)
bg bg bg
Chapter 1 The Accountant's Role in the Organization
bg b g bg bg bg bg bg
Objective 1.1 bg
1) Management accounting:
bg bg
A) focuses on estimating future revenues, costs, and other measures to forecast activities and their
bg bg bg bg bg bg bg bg bg bg bg bg bg bg
results
B) provides information about the company as a whole
bg bg bg bg bg bg bg bg
C) reports information that has occurred in the past that is verifiable and reliable
bg bg bg bg bg bg bg bg bg bg bg bg bg
D) provides information that is generally available only on a quarterly or annual basis
bg bg bg bg bg bg bg bg bg bg bg bg bg
Answer: A b g
Diff: 2 bg
Terms: treasury b g
Objective: 1 b g
AACSB: Reflective thinking b g bg
2) Managers use management accounting information to ________ strategy.
bg bg bg bg bg bg bg bg
A) choose
bg
B) communicate
bg
C) implement
bg
D) All of these answers are correct.
bg bg bg bg bg bg
Answer: D b g
Diff: 1 bg
Terms: total quality management (TQM)
b g bg bg bg
Objective: 1 b g
AACSB: Analytical skills b g bg
3) Financial accounting:
bg bg
A) focuses on the future and includes activities such as preparing next year's operating budget
bg bg bg bg bg bg bg bg bg bg bg bg bg bg
B) must comply with GAAP (generally accepted accounting principles)
bg bg bg bg bg bg bg bg
C) reports include detailed information on the various operating segments of the business such as
bg bg bg bg bg bg bg bg bg bg bg bg bg bg
product lines or departments
bg bg bg
D) is prepared for the use of department heads and other employees
bg bg bg bg bg bg bg bg bg bg bg
Answer: B b g
Diff: 2 bg
Terms: financial accounting
b g bg
Objective: 1 b g
AACSB: Reflective thinking b g bg
1
Copyright © 2012 Pearson Education, Inc.
bg bg bg bg bg
,bg
4) The person most likely to use ONLY financial accounting information is a:
bg bg bg bg bg bg bg bg bg bg bg bg
A) factory shift supervisor
bg bg bg
B) vice president of operations
bg bg bg bg
C) current shareholder
bg bg
D) department manager
bg bg
Answer: C b g
Diff: 1 bg
Terms: financial accounting b g bg
Objective: 1 b g
AACSB: Analytical skills b g bg
5) Which of the following people is LEAST likely to use management accounting information?
bg bg bg bg bg bg bg bg bg bg bg bg bg
A) the controller
bg bg
B) a shareholder evaluating a stock investment
bg bg bg bg bg bg
C) the treasurer
bg bg
D) an assembly department supervisor
bg bg bg bg
Answer: B b g
Diff: 1 bg
Terms: treasury b g
Objective: 1 b g
AACSB: Analytical skills b g bg
6) Financial accounting provides the primary source of information for:
bg bg bg bg bg bg bg bg bg
A) decision making in the finishing department
bg bg bg bg bg bg
B) improving customer service
bg bg bg
C) preparing the income statement for shareholders
bg bg bg bg bg bg
D) planning next year's operating budget
bg bg bg bg bg
Answer: C b g
Diff: 2 bg
Terms: financial accounting b g bg
Objective: 1 b g
AACSB: Reflective thinking b g bg
7) Which of the following descriptors refers to management accounting information?
bg bg bg bg bg bg bg bg bg bg
A) It is verifiable and reliable.
bg bg bg bg bg
B) It is driven by rules.
bg bg bg bg bg
C) It is prepared for shareholders.
bg bg bg bg bg
D) It provides reasonable and timely estimates.
bg bg bg bg bg bg
Answer: D b g
Diff: 2 bg
Terms: treasury b g
Objective: 1 b g
AACSB: Reflective thinking b g bg
2
Copyright © 2012 Pearson Education, Inc.
bg bg bg bg bg
,bg
8) Which of the following statements refers to management accounting information?
bg bg bg bg bg bg bg bg bg bg
A) There are no regulations governing the reports.
bg bg bg bg bg bg bg
B) The reports are generally delayed and historical.
bg bg bg bg bg bg bg
C) The audience tends to be stockholders, creditors, and tax authorities.
bg bg bg bg bg bg bg bg bg bg
D) It primarily measures and records business transactions.
bg bg bg bg bg bg bg
Answer: A b g
Diff: 2 bg
Terms: treasury b g
Objective: 1 b g
AACSB: Reflective thinking b g bg
9) Which of the following groups would be LEAST likely to receive detailed management accounting
bg bg bg bg bg bg bg bg bg bg bg bg bg bg
reports?
A) stockholders
bg
B) sales representatives
bg bg
C) production supervisors
bg bg
D) managers
bg
Answer: A b g
Diff: 1 bg
Terms: treasury b g
Objective: 1 b g
AACSB: Analytical skills b g bg
10) Management accounting information includes:
bg bg bg bg
A) tabulated results of customer satisfaction surveys
bg bg bg bg bg bg
B) the cost of producing a product
bg bg bg bg bg bg
C) the percentage of units produced that are defective
bg bg bg bg bg bg bg bg
D) All of these answers are correct.
bg bg bg bg bg bg
Answer: D b g
Diff: 1 bg
Terms: treasury b g
Objective: 1 b g
AACSB: Reflective thinking b g bg
11) Cost accounting:
bg bg
A) provides information on the efficiency of factory labor
bg bg bg bg bg bg bg bg
B) provides information on the cost of servicing commercial customers
bg bg bg bg bg bg bg bg bg
C) provides information on the performance of an operating division
bg bg bg bg bg bg bg bg bg
D) All of these answers are correct.
bg bg bg bg bg bg
Answer: D b g
Diff: 1 bg
Terms: cost accounting b g bg
Objective: 1 b g
AACSB: Reflective thinking b g bg
3
Copyright © 2012 Pearson Education, Inc. bg bg bg bg bg
