TEST BANKt
Financial and Managerial Accounting:
t t t
Managerial Chapters, 7th Edition
t t
t
(Miller-Nobles) Chapter 1-11
t t
,Chapter tM:1 Introduction tto tManagerial tAccounting
Learning tObjective tM:1-1
1) Managerial taccounting tfocuses ton tproviding tinformation tfor tinternal tplanning tand
tcontrol. t tAnswer: t TRUE
Diff: t1
LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
PE tQuestion tType: t t Concept
H2: t tWhy tIs tManagerial tAccounting tImportant? t(H1)
2) Financial taccounting tprepares treports tfor tinternal tpurposes, twhereas tmanagerial taccounting
tprovides t information tto texternal tstakeholders.
Answer: t tFALSE
Explanation: tThe treverse tis ttrue. tFinancial taccounting tserves texternal tstakeholder tinformation
tneedswhile t managerial taccounting tserves tthe tneeds tof tmanagers tand tinternal tstaff.
Diff: t1
LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
PE tQuestion tType: t t Concept
H2: t tWhy tIs tManagerial tAccounting tImportant? t(H1)
3) Financial tstatements tprepared tfor tinvestors tand tcreditors toften tinclude tforward-looking
tinformation t because tthey tmake tdecisions tbased ton ta tcompany's tfuture tprospects.
Answer: t tFALSE
Explanation: tFinancial tstatements tprovide tmostly thistorical tinformation; trelevant tand
tfaithfully t representative tinformation tand tfocused ton tthe tpast.
Diff: t1
LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
PE tQuestion tType: t t Concept
H2: t tWhy tIs tManagerial tAccounting tImportant? t(H1)
4) Managerial taccounting treporting tby ta tpublic tfirm tis trequired tto tfollow tthe trules tof
tGAAP. t tAnswer: t FALSE
Explanation: tManagerial taccounting tinformation tis tnot tguided tby tGAAP tbut trather tby tthe
tconcept tof t usefulness tto tmanagement tfor tdecision tmaking tpurposes.
Diff: t1
LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
PE tQuestion tType: t t Concept
,H2: t tWhy tIs tManagerial tAccounting tImportant? t(H1)
5) Financial treporting tis ttypically tmuch tmore tdetailed tthan tmanagerial
taccounting. t tAnswer: t FALSE
Explanation: t Financial t reporting t is t typically t less t detailed t than t managerial
t accounting t information. t Financial t accounting t reporting t is tusually tsummary t reports,
t prepared t primarily t on t the t company tas ta t whole, tusually ton ta tquarterly tor tannual tbasis.
Diff: t1
LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
PE tQuestion tType: t t Concept
H2: t tWhy tIs tManagerial tAccounting tImportant? t(H1)
6) Managerial taccounting tprovides tfinancial tstatements tthat treport tresults tof toperations,
tfinancial t position, tand tcash tflows tboth tto tmanagers tand tto texternal tstockholders.
Answer: t tFALSE
Explanation: tManagerial taccounting tprovides tthe tinformation tneeded tto tplan tand tcontrol
toperations tand t therefore tserves tthe tinformation tneeds tof tinternal tparties tsuch tas tmanagers
tand tstaff.
Diff: t1
LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
PE tQuestion tType: t t Concept
H2: t tWhy tIs tManagerial tAccounting tImportant? t(H1)
7) Which tof tthe tfollowing tis ta tfocus tof tmanagerial taccounting?
A) to tgenerate ta tcompany's tfinancial tstatements tfor ttax treporting
B) to tprovide tinformation tto tbusiness tmanagers tto tassist tthem tin tcontrolling ttheir tbusinesses
C) to tprovide tinformation tto tshareholders tto tassist tthem twith ttheir tinvestment tdecisions
D) to tensure tthat tthe treports tproduced tfor tinternal tand texternal tbusiness tpurposes tare tGAAP
tcompliant t tAnswer: t B
Diff: t1
LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
PE tQuestion tType: t t Concept
H2: t tWhy tIs tManagerial tAccounting tImportant? t(H1)
8) Which tof tthe tfollowing tstatements tis ttrue tof tmanagerial taccounting?
A) The texternal tstakeholders tof ta tcompany tare tthe tprimary tusers tof tmanagerial taccounting.
B) Managerial taccounting tinformation tis tused tto thelp tmanagers tplan, tdirect tand tcontrol ttheir
operations.
t
C) An texternal taudit tby tan tindependent tCPA tis trequired tfor tmanagerial taccounting tinformation.
D) Managerial taccounting tinformation tmust tcomply twith tGenerally tAccepted tAccounting
Principles. t tAnswer: t B
t
Diff: t1
, LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
Financial and Managerial Accounting:
t t t
Managerial Chapters, 7th Edition
t t
t
(Miller-Nobles) Chapter 1-11
t t
,Chapter tM:1 Introduction tto tManagerial tAccounting
Learning tObjective tM:1-1
1) Managerial taccounting tfocuses ton tproviding tinformation tfor tinternal tplanning tand
tcontrol. t tAnswer: t TRUE
Diff: t1
LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
PE tQuestion tType: t t Concept
H2: t tWhy tIs tManagerial tAccounting tImportant? t(H1)
2) Financial taccounting tprepares treports tfor tinternal tpurposes, twhereas tmanagerial taccounting
tprovides t information tto texternal tstakeholders.
Answer: t tFALSE
Explanation: tThe treverse tis ttrue. tFinancial taccounting tserves texternal tstakeholder tinformation
tneedswhile t managerial taccounting tserves tthe tneeds tof tmanagers tand tinternal tstaff.
Diff: t1
LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
PE tQuestion tType: t t Concept
H2: t tWhy tIs tManagerial tAccounting tImportant? t(H1)
3) Financial tstatements tprepared tfor tinvestors tand tcreditors toften tinclude tforward-looking
tinformation t because tthey tmake tdecisions tbased ton ta tcompany's tfuture tprospects.
Answer: t tFALSE
Explanation: tFinancial tstatements tprovide tmostly thistorical tinformation; trelevant tand
tfaithfully t representative tinformation tand tfocused ton tthe tpast.
Diff: t1
LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
PE tQuestion tType: t t Concept
H2: t tWhy tIs tManagerial tAccounting tImportant? t(H1)
4) Managerial taccounting treporting tby ta tpublic tfirm tis trequired tto tfollow tthe trules tof
tGAAP. t tAnswer: t FALSE
Explanation: tManagerial taccounting tinformation tis tnot tguided tby tGAAP tbut trather tby tthe
tconcept tof t usefulness tto tmanagement tfor tdecision tmaking tpurposes.
Diff: t1
LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
PE tQuestion tType: t t Concept
,H2: t tWhy tIs tManagerial tAccounting tImportant? t(H1)
5) Financial treporting tis ttypically tmuch tmore tdetailed tthan tmanagerial
taccounting. t tAnswer: t FALSE
Explanation: t Financial t reporting t is t typically t less t detailed t than t managerial
t accounting t information. t Financial t accounting t reporting t is tusually tsummary t reports,
t prepared t primarily t on t the t company tas ta t whole, tusually ton ta tquarterly tor tannual tbasis.
Diff: t1
LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
PE tQuestion tType: t t Concept
H2: t tWhy tIs tManagerial tAccounting tImportant? t(H1)
6) Managerial taccounting tprovides tfinancial tstatements tthat treport tresults tof toperations,
tfinancial t position, tand tcash tflows tboth tto tmanagers tand tto texternal tstockholders.
Answer: t tFALSE
Explanation: tManagerial taccounting tprovides tthe tinformation tneeded tto tplan tand tcontrol
toperations tand t therefore tserves tthe tinformation tneeds tof tinternal tparties tsuch tas tmanagers
tand tstaff.
Diff: t1
LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
PE tQuestion tType: t t Concept
H2: t tWhy tIs tManagerial tAccounting tImportant? t(H1)
7) Which tof tthe tfollowing tis ta tfocus tof tmanagerial taccounting?
A) to tgenerate ta tcompany's tfinancial tstatements tfor ttax treporting
B) to tprovide tinformation tto tbusiness tmanagers tto tassist tthem tin tcontrolling ttheir tbusinesses
C) to tprovide tinformation tto tshareholders tto tassist tthem twith ttheir tinvestment tdecisions
D) to tensure tthat tthe treports tproduced tfor tinternal tand texternal tbusiness tpurposes tare tGAAP
tcompliant t tAnswer: t B
Diff: t1
LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
PE tQuestion tType: t t Concept
H2: t tWhy tIs tManagerial tAccounting tImportant? t(H1)
8) Which tof tthe tfollowing tstatements tis ttrue tof tmanagerial taccounting?
A) The texternal tstakeholders tof ta tcompany tare tthe tprimary tusers tof tmanagerial taccounting.
B) Managerial taccounting tinformation tis tused tto thelp tmanagers tplan, tdirect tand tcontrol ttheir
operations.
t
C) An texternal taudit tby tan tindependent tCPA tis trequired tfor tmanagerial taccounting tinformation.
D) Managerial taccounting tinformation tmust tcomply twith tGenerally tAccepted tAccounting
Principles. t tAnswer: t B
t
Diff: t1
, LO: t t M:1-1
AACSB: t Application tof
tknowledge t AICPA tFunctional:
t Reporting
