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

1-1 Test llBank llfor llDavis ll& llDavis, llManagerial llAccounting,
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TEST BANK ll




Managerial Accounting 4th Edition
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By Charles Davis Elizabeth Davis Chapter 1 - 13
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, 1-2 Test llBank llfor llDavis ll& llDavis, llManagerial llAccounting,
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Table Of Contents ll ll




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 ll


Accounting as a Tool for Managementll ll ll ll ll




CHAPTER LEARNING OBJECTIVES
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1. Define managerial accounting (Unit 1.1)
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There llare llseveral llformal lldefinitions llof llmanagerial llaccounting. llA llsimple llone llis
ll“thelgeneration llof llrelevant llinformation llto llsupport llmanagement’s lldecision-

making llactivities.”
2. Describe the differences between managerial and financial
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accounting(Unit 1.1)
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Managerial llaccounting’s llprimary llusers llare llmanagers lland lldecision llmakers llwithin llan
llorganization, llwhereas llfinancial llaccounting llis llaimed llprimarily llat llexternal llusers.

llUnlike llGAAP llthat llguides llfinancial llaccounting, llthere llare llno llmandated llrules llin

llmanagerial llaccounting. llManagerial llaccounting llreports llfocus llon lloperating llsegments,

llwhile llfinanciallaccounting llstatements llreport llresults llfor llthe llorganization llas lla llwhole.

llManagerial llaccounting llis llconcerned llmore llwith llprojecting llfuture llresults llthan

llreporting llpast llresults. llManagerial llinformation llis llprepared llto lltake lladvantage llof lla

llwindow llof llopportunity, llevenlif llsome llaccuracy llmust llbe llsacrificed. llFinancial

llaccounting llinformation llis llbalanced llto llthe llpenny lland llis lldelivered llafter llthe llend llof

llthe llaccounting llperiod.


3. List and describe the four functions of managers (Unit 1.1)
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Planning llmeans llsetting lla lldirection llfor llthe llorganization. llLong-term, llor llstrategic
llplanninglprovides lldirection llfor lla llfive- llto llten-year llperiod. llShort-term llor lloperational

llplanning llprovides llmore lldetailed llguidance llfor llthe llcoming llyear; llit lltranslates llthe

llcompany’s llstrategy llinto llaction llsteps. llControlling llis llthe llmonitoring llof llday-to-day

lloperations llto llidentify llany llproblems llthat llrequire llcorrective llaction. llEvaluating llis llthe

llprocess llof llcomparing lla llparticular llperiod’s llactual llresults llto llplanned llresults, llfor llthe

llpurpose llof llassessing llmanagerial llperformance. llDecision llmaking llmeans llchoosing

llbetween llalternative llcourses llof llaction.


4. Explain how the selection of a particular business strategy determines
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theinformation that managers need to run an organization effectively
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(Unit 1.2)
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To llrun lla llbusiness lleffectively, llmanagers llneed llinformation llthat llshows llhow llwell
lloperations llare llmeeting llthe llorganization’s llstrategic llgoals. llFor llinstance, llif llthe

llorganization’s llstrategy llis llto llbe lla lllow-cost llproducer, llinformation llabout llproduct

llcostsland llcost llvariances llwill llbe llmore lluseful llto llmanagers llthan llinformation llabout

llresearchland lldevelopment.

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5. Discuss the importance of ethical behavior in managerial accounting
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(Unit1.3)
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Ethical llbehavior llmeans llknowing llright llfrom llwrong lland llthen lldoing llthe llright llthing.
llManylcompanies lland llmost llprofessional llorganizations llhave llcodes llof llconduct llto

llguide llemployees’ llactions. llActing llunethically llcan lllead llto llillegal llactivity lland

llultimately llto llthe lldestruction llof llthe llfirm. llFurthermore, llresearch llhas llshown llthat lla

llpublic llcommitment lltolethical llbehavior llcan lllead llto llsuperior llfinancial llperformance.