Fundamental Managerial Accounting Concepts, 8e Thomas Edmonds
Christopher Edmonds Bor-Yi Tsay Philip Olds (Test Bank All
Chapters, 100% Original Verified, A+ Grade)
Chapter 01
Management Accounting and Corporate Governance
Answer Key
Multiple Choice Questions
1. Ashley Bradshaw is the manager of one department in a large store. In this capacity,
which of the following kinds of information would she be interested in?
A. Economic data
B. Financial data
C. Nonfinancial data
D. Both financial data and nonfinancial data
Answer: D
Learning Objective: 01-01 Distinguish between managerial and financial accounting.
Topic: Users and Types of Information
Blooms: Remember
AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Decision Making
Difficulty: 1 Easy
2. All of the following are features of managerial accounting except:
A. information is provided primarily to insiders such as managers.
B. information includes economic and non-financial data as well as financial data.
C. information is characterized by objectivity, reliability, consistency, and accuracy.
D. information is reported continuously with a present or future orientation.
Answer: C
Learning Objective: 01-01 Distinguish between managerial and financial accounting.
Topic: Information Characteristics
Blooms: Remember
1-1
Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
,AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Decision Making
Difficulty: 1 Easy
3. Choose the answer that is not a distinguishing characteristic of financial accounting
information.
A. It is global information that reflects the performance of the whole company.
B. It is focused primarily on the future.
C. It is more concerned with financial data than physical or economic data.
D. It is more highly regulated than managerial accounting information.
Answer: B
Learning Objective: 01-01 Distinguish between managerial and financial accounting.
Topic: Information Characteristics
Blooms: Remember
AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Decision Making
Difficulty: 1 Easy
4. Managerial accounting information is limited or restricted by which of the following
authorities or principles?
A. Securities and Exchange Commission
B. Generally Accepted Accounting Principles
C. Managerial Accounting Standards Board
D. Value-Added Principle
Answer: C
Learning Objective: 01-01 Distinguish between managerial and financial accounting.
Topic: Regulation
Blooms: Remember
AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Decision Making
Difficulty: 1 Easy
1-2
Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
,5. Select the incorrect statement regarding the relationship between type of user and type
of information.
A. Middle managers need more nonfinancial, or operational data than do senior
executives.
B. Assembly line supervisors need more immediate feedback on performance than do
senior executives.
C. Senior executives need less aggregated information than do lower-level managers.
D. Senior executives use general economic information as well as financial
information.
Answer: C
Learning Objective: 01-01 Distinguish between managerial and financial accounting.
Topic: Users and Types of Information
Blooms: Remember
AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Decision Making
Difficulty: 1 Easy
6. Select the correct statement regarding managerial and financial accounting.
A. Users of managerial accounting information desire greater aggregation than do users
of financial accounting information.
B. Both managerial and financial accounting use economic and physical data in
addition to financial data.
C. Financial accounting is more highly regulated than managerial accounting.
D. Timeliness is more important in financial accounting than in managerial accounting.
Answer: C
Learning Objective: 01-01 Distinguish between managerial and financial accounting.
Topic: Regulation
Blooms: Remember
AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Decision Making
Difficulty: 1 Easy
1-3
Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
, 7. Which of the following most exemplifies the value-added principle?
A. An ongoing process where continuous improvement is the goal
B. A competitive management program that emphasizes quality
C. Information gathering and reporting activities should be restricted to those activities
that add value in excess of their cost
D. Managerial accounting information is measured in economic, physical, and financial
terms
Answer:
Learning Objective: 01-01 Distinguish between managerial and financial accounting.
Topic: Regulation
Blooms: Remember
AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Decision Making
Difficulty: 1 Easy
8. Which of the following costs would be classified as a direct cost for a company that
produces motorcycles?
A. Rent of manufacturing facility that produces motorcycles
B. Seats used in the motorcycles
C. Wages of motorcycle assembly workers
D. Both seats used in the motorcycles and wages of motorcycle assembly workers are
correct.
Answer: D
Learning Objective: 01-03 Show how manufacturing product costs affect financial statements.
Topic: Effect of Manufacturing Product Costs on Financial Statements
Blooms: Understand
AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Measurement
Difficulty: 2 Medium
1-4
Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
Christopher Edmonds Bor-Yi Tsay Philip Olds (Test Bank All
Chapters, 100% Original Verified, A+ Grade)
Chapter 01
Management Accounting and Corporate Governance
Answer Key
Multiple Choice Questions
1. Ashley Bradshaw is the manager of one department in a large store. In this capacity,
which of the following kinds of information would she be interested in?
A. Economic data
B. Financial data
C. Nonfinancial data
D. Both financial data and nonfinancial data
Answer: D
Learning Objective: 01-01 Distinguish between managerial and financial accounting.
Topic: Users and Types of Information
Blooms: Remember
AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Decision Making
Difficulty: 1 Easy
2. All of the following are features of managerial accounting except:
A. information is provided primarily to insiders such as managers.
B. information includes economic and non-financial data as well as financial data.
C. information is characterized by objectivity, reliability, consistency, and accuracy.
D. information is reported continuously with a present or future orientation.
Answer: C
Learning Objective: 01-01 Distinguish between managerial and financial accounting.
Topic: Information Characteristics
Blooms: Remember
1-1
Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
,AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Decision Making
Difficulty: 1 Easy
3. Choose the answer that is not a distinguishing characteristic of financial accounting
information.
A. It is global information that reflects the performance of the whole company.
B. It is focused primarily on the future.
C. It is more concerned with financial data than physical or economic data.
D. It is more highly regulated than managerial accounting information.
Answer: B
Learning Objective: 01-01 Distinguish between managerial and financial accounting.
Topic: Information Characteristics
Blooms: Remember
AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Decision Making
Difficulty: 1 Easy
4. Managerial accounting information is limited or restricted by which of the following
authorities or principles?
A. Securities and Exchange Commission
B. Generally Accepted Accounting Principles
C. Managerial Accounting Standards Board
D. Value-Added Principle
Answer: C
Learning Objective: 01-01 Distinguish between managerial and financial accounting.
Topic: Regulation
Blooms: Remember
AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Decision Making
Difficulty: 1 Easy
1-2
Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
,5. Select the incorrect statement regarding the relationship between type of user and type
of information.
A. Middle managers need more nonfinancial, or operational data than do senior
executives.
B. Assembly line supervisors need more immediate feedback on performance than do
senior executives.
C. Senior executives need less aggregated information than do lower-level managers.
D. Senior executives use general economic information as well as financial
information.
Answer: C
Learning Objective: 01-01 Distinguish between managerial and financial accounting.
Topic: Users and Types of Information
Blooms: Remember
AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Decision Making
Difficulty: 1 Easy
6. Select the correct statement regarding managerial and financial accounting.
A. Users of managerial accounting information desire greater aggregation than do users
of financial accounting information.
B. Both managerial and financial accounting use economic and physical data in
addition to financial data.
C. Financial accounting is more highly regulated than managerial accounting.
D. Timeliness is more important in financial accounting than in managerial accounting.
Answer: C
Learning Objective: 01-01 Distinguish between managerial and financial accounting.
Topic: Regulation
Blooms: Remember
AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Decision Making
Difficulty: 1 Easy
1-3
Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
, 7. Which of the following most exemplifies the value-added principle?
A. An ongoing process where continuous improvement is the goal
B. A competitive management program that emphasizes quality
C. Information gathering and reporting activities should be restricted to those activities
that add value in excess of their cost
D. Managerial accounting information is measured in economic, physical, and financial
terms
Answer:
Learning Objective: 01-01 Distinguish between managerial and financial accounting.
Topic: Regulation
Blooms: Remember
AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Decision Making
Difficulty: 1 Easy
8. Which of the following costs would be classified as a direct cost for a company that
produces motorcycles?
A. Rent of manufacturing facility that produces motorcycles
B. Seats used in the motorcycles
C. Wages of motorcycle assembly workers
D. Both seats used in the motorcycles and wages of motorcycle assembly workers are
correct.
Answer: D
Learning Objective: 01-03 Show how manufacturing product costs affect financial statements.
Topic: Effect of Manufacturing Product Costs on Financial Statements
Blooms: Understand
AACSB: Knowledge Application
AICPA: BB Industry
AICPA: FN Measurement
Difficulty: 2 Medium
1-4
Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.
