Test Bank for Managerial Accounting for Managers 2nd Edition by Noreen Brewer Garrison

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Chapter,02,
Managerial,Accounting,and,Cost,Concepts,

True,/,False,Questions,

1. Managerial,accounting,is,primarily,concerned,with,the,organization,as,a,whole,rather,than,
with,segments,of,the,organization.,True,False,
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2. Managerial,accounting,places,less,emphasis,on,nonmonetary,data,than,financial,accountin
g.,True,False,
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3. Direct,labor,is,a,part,of,both,prime,cost,and,conversion,cost.,True,,,False, ,




4. Wages,paid,to,production,supervisors,would,be,considered,direct,labor.,True, False,




5. Direct,,material,,cost,,combined,,with,,manufacturing,,overhead,,cost,,is,,known,,as,,conver
sion,cost.,True,,,False, ,


6. Advertising,is,a,product,cost,as,long,as,it,promotes,specific,products.,True, False,
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2-1,
7. Although,depreciation,is,always,a,period,cost,in,a,merchandising,firm,,it,can,be,a,,
product,cost,in,a,manufacturing,firm.,True,,,False,

, Chapter,02,-,Managerial,Accounting,and,Cost,Concepts,
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8. In,a,manufacturing,firm,,all,costs,are,product,costs.,True,,,False,
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9. The,cost,of,shipping,parts,from,a,supplier,is,considered,a,product,cost.,True, False,
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10. If,the,finished,goods,inventory,increases,between,the,beginning,and,the,end,of,a,period,,the
n,the,cost,of,goods,manufactured,for,the,period,is,larger,than,the,cost,of,goods,sold.,True,F
alse,
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11. The,inventory,of,finished,goods,on,hand,at,the,end,of,a,period,is,considered,an,asset,,but,in
ventories,of,raw,materials,and,work-in-
process,are,not,considered,assets,until,production,is,completed.,True,False,
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12. The,cost,of,goods,manufactured,for,a,period,is,the,amount,transferred,from,work,in,proces
s,inventory,to,finished,goods,inventory,during,the,period.,True,False,
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13. Differential,costs,can,be,either,fixed,or,variable.,,True,False,
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14. A,fixed,cost,is,constant,per,unit,of,product.,True, False,
15. The,variable,cost,per,unit,is,constant,and,does,not,depend,on,how,many,units,are,produced
.,True,False,
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2-2,

, Chapter,02,-,Managerial,Accounting,and,Cost,Concepts,
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16. The,cost,of,napkins,put,on,each,person's,tray,at,a,fast,food,restaurant,is,a,fixed,cost.,True,F
alse,
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17. A,factory,supervisor's,salary,would,be,classified,as,a,direct,cost,of,a,unit,of,product.,True,F
alse,
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Multiple,Choice,Questions,
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18. Managerial,accounting:,
A. has,its,primary,emphasis,on,the,future.,
B. is,required,by,regulatory,bodies,such,as,the,SEC.,
C. focuses,on,the,organization,as,a,whole,,rather,than,on,the,organization's,segments.,
D. Responses,a,,b,,and,c,are,all,correct.,
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19.,The,plans,of,management,are,expressed,formally,in:,A.,
, the,annual,report,to,shareholders.,
B. Form,10-
Q,submitted,to,the,Securities,and,Exchange,Commission.,
C. performance,reports.,D.,budgets.,
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2-3,

, Chapter,02,-,Managerial,Accounting,and,Cost,Concepts,
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20.,Which,of,the,following,IS,a,characteristic,of,financial,,
accounting?,A.,not,mandatory,
B. must,follow,GAAP,
C. emphasis,on,relevance,of,data,,rather,than,precision,
D. both,A,and,C,above,
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21.,The,corporate,controller's,salary,would,be,considered,a(n):,A.,
, manufacturing,cost.,B.,
, product,cost.,
C.,administrative,cost.,D.
,selling,expense.,
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22.,The,costs,of,direct,materials,are,classified,as:,




A. Option,A,
B. Option,B,
C. Option,C,
D. Option,D,
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, 23.,Manufacturing,overhead:,
A. can,be,either,a,variable,cost,or,a,fixed,cost.,
B. includes,the,costs,of,shipping,finished,goods,to,customers.,
C. includes,all,factory,labor,costs.,
D. includes,all,fixed,costs.,
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2-4,