Garrison Managerial Accounting 12th Edition Test Bank | Chapter 71 Solutions & Answers

Chapterj1j ManagerialjAccountingjandjthejBusinessjEnvironment


True/FalsejQuestions

1. Althoughjfinancialjandjmanagerialjaccountingjdifferjinjmanyjways,jtheyjarejsimilarjinjth
atjbothjrelyjonjthejsamejunderlyingjfinancialjdata.

Answer:jTruej j Level:jMediumj j LO:j1

2. Managerialjaccountingjisjajbranchjofjfinancialjaccountingjandjservesjessentiallyjthejsa
mejpurposesjasjfinancialjaccounting.

Answer:jFalsej j Level:jMediumj j LO:j1

3. Managerialjaccountingjplacesjgreaterjemphasisjonjthejfuturejthanjfinancialja
ccounting,jwhichjisjprimarilyjconcernedjwithjthejpast.

Answer:jTruej j Level:jEasyj j LO:j1

4. Managerialjaccountingjisjnotjneededjinjajnon-profitjorjgovernmentaljorganization.

Answer:jFalsej j Level:jEasyj j LO:j1

5. Whenjcarryingjoutjtheirjplanningjactivities,jmanagersjselectjajcoursejofjactionjandjsp
ecifyjhowjthejactionjwilljbejimplemented.

Answer:jTruej j Level:jEasyj j LO:j2

6. Whenjcarryingjoutjtheirjplanningjactivities,jmanagersjobtainjfeedbackjtojensurejthatjthej
planjisjactuallyjcarriedjoutjandjisjappropriatelyjmodifiedjasjcircumstancesjchange.

Answer:jFalsej j Level:jMediumj j LO:j2

7. Thejcontrollerjoccupiesjajlinejpositionjinjanjorganization.

Answer:jFalsej j Level:jEasyj j LO:j2

8. Decentralizationjmeansjthejdelegationjofjdecision-
makingjauthorityjthroughoutjanjorganizationjbyjallowingjmanagersjatjvariousjoperatin
gjlevelsjtojmakejkeyjdecisionsjrelatingjtojtheirjownjareajofjresponsibility.

Answer:jTruej j Level:jEasyj j LO:j2




Garrison,jManagerialjAccounting,j12thjEdition 3

,Chapterj1j ManagerialjAccountingjandjthejBusinessjEnvironment


9. Ajfirm'sjorganizationjchartjwilljnormallyjshowjbothjthejformaljandjinformaljlinesjofjre
portingjandjcommunication.

Answer:jFalsej j Level:jEasyj j LO:j2

10. ThejChiefjFinancialjOfficerjofjanjorganizationjisjresponsiblejforjensuringjthatjlinejop
erationsjrunjsmoothly.

Answer:jFalsej j Level:jMediumj j LO:j2

11. Traditionally,jcompaniesjhavejmaintainedjlargejamountsjofjrawjmaterials,jworkjinjproce
ss,jandjfinishedjgoodsjinventoriesjtojactjasjbuffersjsojthatjoperationsjcanjproceedjsmoothl
yjevenjifjtherejarejunanticipatedjdisruptions.

Answer:jTruej j Level:jMediumj j LO:j3

12. ProcessjReengineeringjisjgenerallyjconsideredjtojbejajmorejradicaljapproachjtoji
mprovementjthanjTotaljQualityjManagement.

Answer:jTruej j Level:jEasyj j LO:j3

13. ProcessjReengineeringjemphasizesjajteamjapproachjinvolvingjfront-
linejworkers,jwhereasjTotaljQualityjManagementjisjusuallyjimplementedjusingjoutsid
ejspecialistsjandjisjimposedjfromjabove.

Answer:jFalsej j Level:jMediumj j LO:j3

14. Ifjethicaljstandardsjwerejnotjgenerallyjfollowed,jonejofjthejresultsjwouldjprobablyjbejfe
werjgoodsjandjservicesjavailablejinjthejmarketplace.

Answer:jTruej j Level:jMediumj j LO:j4

15. ThejStandardsjofjEthicaljConductjforjManagementjAccountantsjpromulgatedjbyjthejIns
titutejofjManagementjAccountantsjspecificallyjstatejthatjmanagementjaccountants'jsolej
ethicaljresponsibilityjisjtojnotjbreakjanyjlaws.

Answer:jFalsej j Level:jEasyj j LO:j4




4 Garrison,jManagerialjAccounting,j12thjEdition

,Chapterj1j ManagerialjAccountingjandjthejBusinessjEnvironment


MultiplejChoicejQuestions

16. Managementjaccountingjfocusesjprimarilyjonjprovidingjdatajfor:
A) internaljusesjbyjmanagers.
B) externaljusesjbyjstockholdersjandjcreditors.
C) externaljusesjbyjthejInternaljRevenuejService.
D) externaljusesjbyjthejSecuritiesjandjExchangejCommission.

Answer:jAj j Level:jEasyj j LO:j1

17. Managerialjaccounting:
A) isjmorejfuturejorientedjthanjfinancialjaccounting.
B) tendsjtojsummarizejinformationjmorejthanjfinancialjaccounting
C) isjprimarilyjconcernedjwithjprovidingjinformationjtojexternaljusers.
D) isjmorejconcernedjwithjprecisionjthanjtimeliness.

Answer:jAj j Level:jEasyj j LO:j1

18. Comparedjtojfinancialjaccounting,jmanagerialjaccountingjplacesjmorejemphasisjon:
A) thejflexibilityjofjinformation.
B) thejprecisionjofjinformation.
C) thejtimelinessjofjinformation.
D) bothjAjandjCjabove.

Answer:jDj j Level:jEasyj j LO:j1

19. Thejfunctionjofjmanagementjthatjcomparesjplannedjresultsjtojactualjresultsjisjknownjas:
A) planning.
B) directingjandjmotivating.
C) controlling.
D) decisionjmaking.

Answer:jCj j Level:jEasyj j LO:j2

20. Whichjofjthejfunctionsjofjmanagementjinvolvesjoverseeingjday-to-dayjactivities?
A) Planning
B) Directingjandjmotivating
C) Controlling
D) Decisionjmaking

Answer:jBj j Level:jEasyj j LO:j2




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, Chapterj1j ManagerialjAccountingjandjthejBusinessjEnvironment


21. Whichjofjthejfollowingjisjnotjonejofjthejthreejbasicjactivitiesjofjajmanager?
A) Planning
B) Controlling
C) Directingjandjmotivating
D) Compilingjmanagementjaccountingjreportsj

Answer:jDj Level:jEasyj LO:j2

22. Thejdelegationjofjdecisionjmakingjtojlowerjlevelsjinjanjorganizationjisjknownjas:
A) thejplanningjandjcontroljcycle.
B) controlling.
C) decentralization.
D) nonejofjthese.

Answer:jCj j Level:jEasyj j LO:j2

23. Whichjofjthejfollowingjstatementsjarejfalsejconcerningjlinejandjstaffjfunctions?

I. Personsjoccupyingjstaffjfunctionsjhavejauthorityjoverjpersonsjoccupyingjlinejf
unctions.
II. Bothjlinejandjstaffjfunctionsjarejdepictedjonjthejorganizationjchart.
III. Linejfunctionsjarejdirectlyjrelatedjtojthejbasicjobjectivesjofjanjorganization.

A) OnlyjI
B) OnlyjII
C) OnlyjIjandjII
D) I,jII,jandjIII

Answer:jAj j Level:jMediumj j LO:j2

24. Whichjofjfollowingjwouldjnormallyjbejfoundjonjajmanufacturingjcompany'sjor
ganizationjchart?
A) thejlayoutjofjthejfactoryjassemblyjlines
B) ajlistjofjthejmaterialsjneededjtojproducejeachjofjthejcompany'sjproducts
C) thejinformaljlinesjofjreportingjandjcommunication
D) nonejofjthejabove

Answer:jDj j Level:jEasyj j LO:j2




6 Garrison,jManagerialjAccounting,j12thjEdition