Managerial Accounting 4th Edition By Charles Davis - Test Bank, All 13 Chapters Covered, Verified Latest Edition

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TEST BANK ii




Managerial Accounting 4th Edition
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By Charles Davis Elizabeth Davis Chapter 1 - 13
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, 1-2 Test iiBank iifor iiDavis ii& iiDavis, iiManagerial iiAccounting,
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Table Of Contents ii ii




1. Accounting as a Tool for Management
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2.Cost Behavior and Cost Estimation
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3. Cost-Volume-Profit Analysis and Pricing Decisions
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4. Product Costs and Job Order Costing
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5. Planning and Forecasting
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5A: Planning and Forecasting in a Retail Setting* (online only)
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6. Performance Evaluation: Variance Analysis
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7. Activity-Based Costing and Activity-Based Management
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8. Using Accounting Information to Make Managerial Decisions
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9. Capital Budgeting
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10. Decentralization and Performance Evaluation
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11. Performance Evaluation Revisited: A Balanced Approach
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12. Financial Statement Analysis
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13. Statement of Cash Flows
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Chapter 1 ii


Accounting as a Tool for Management ii ii ii ii ii




CHAPTER LEARNING OBJECTIVES
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1. Define managerial accounting (Unit 1.1)
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There iiare iiseveral iiformal iidefinitions iiof iimanagerial iiaccounting. iiA iisimple
iione iiis ii“theigeneration iiof iirelevant iiinformation iito iisupport ii management’s

iidecision-making iiactivities.”


2. Describe the differences between managerial and financial
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accounting(Unit 1.1)
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Managerial iiaccounting’s iiprimary iiusers iiare iimanagers iiand iidecision iimakers
iiwithin iian ii organization, iiwhereas iifinancial iiaccounting iiis iiaimed iiprimarily iiat

iiexternal iiusers. iiUnlike iiGAAP iithat iiguides iifinancial iiaccounting, iithere iiare iino


iimandated iirules iiin iimanagerial iiaccounting. iiManagerial iiaccounting iireports

iifocus iion iioperating ii segments, iiwhile iifinancial iaccounting iistatements iireport

iiresults iifor iithe iiorganization iias iia iiwhole. iiManagerial iiaccounting iiis iiconcerned

iimore iiwith iiprojecting iifuture iiresults ii than iireporting iipast iiresults. ii Managerial

iiinformation iiis iiprepared iito ii take iiadvantage ii of iia iiwindow iiof iiopportunity,

iieveniif iisome iiaccuracy iimust iibe ii sacrificed. iiFinancial iiaccounting iiinformation iiis

iibalanced iito iithe ii penny iiand iiis iidelivered iiafter iithe iiend ii of iithe iiaccounting


iiperiod.


3. List and describe the four functions of managers (Unit 1.1)
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Planning iimeans iisetting iia iidirection iifor iithe iiorganization. iiLong-term, iior
iistrategic iiplanningiprovides iidirection iifor iia iifive- iito iiten-year iiperiod. iiShort-

term iior iioperational iiplanning iiprovides iimore iidetailed iiguidance iifor iithe
iicoming iiyear; iiit iitranslates iithe ii company’s ii strategy iiinto iiaction iisteps.

iiControlling iiis iithe iimonitoring iiof iiday-to-day iioperations iito iiidentify iiany

iiproblems iithat iirequire iicorrective iiaction. iiEvaluating iiis iithe iiprocess ii of

iicomparing iia ii particular iiperiod’s iiactual iiresults iito iiplanned iiresults, iifor iithe


iipurpose iiof iiassessing iimanagerial iiperformance. iiDecision iimaking iimeans

iichoosing iibetween iialternative iicourses iiof iiaction.


4. Explain how the selection of a particular business strategy
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determines theinformation that managers need to run an
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organization effectively (Unit 1.2)
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To iirun iia iibusiness iieffectively, iimanagers iineed iiinformation iithat iishows
iihow iiwell iioperations iiare iimeeting ii the ii organization’s iistrategic iigoals. iiFor

iiinstance, iiif iithe iiorganization’s ii strategy iiis ii to iibe iia iilow-cost iiproducer,

iiinformation iiabout iiproduct iicostsiand ii cost iivariances iiwill iibe iimore iiuseful iito

iimanagers iithan iiinformation iiabout iiresearchia nd iidevelopment.

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5. Discuss the importance of ethical behavior in managerial
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accounting (Unit1.3)
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Ethical iibehavior iimeans iiknowing iiright iifrom iiwrong iiand iithen iidoing iithe
iiright iithing. iiManyicompanies iiand ii most iiprofessional iiorganizations iihave


iicodes iiof iiconduct iito iiguide iiemployees’ iiactions. iiActing iiunethically iican iilead

iito iiillegal iiactivity iiand iiultimately iito ii the iidestruction iiof iithe iifirm.

iiFurthermore, iiresearch iihas iishown ii that iia iipublic iicommitment iitoiethical

iibehavior iican iilead iito iisuperior iifinancial iiperformance.