TEST BANK
Fundamental Managerial Accounting Concepts, 9th Edition
Thomas P. Edmonds
JN
U
R
SE
,Table of Contents
Chapter 1 Management Accounting and Corporate Governance
Chapter 2 Cost Behavior, Operating Leverage, and Profitability Analysis
Chapter 3 Analysis of Cost, Volume, and Pricing to Increase Profitability
Chapter 4 Cost Accumulation, Tracing, and Allocation
Chapter 5 Cost Management in an Automated Business Environment:
ABC, ABM, and TQM
Chapter 6 Relevant Information for Special Decisions
Chapter 7 Planning for Profit and Cost Control
Chapter 8 Performance Evaluation
Chapter 9 Responsibility Accounting
Chapter 10 Planning for Capital Investments
Chapter 11 Product Costing in Service and Manufacturing Entities
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Chapter 12 Job-Order, Process, and Hybrid Costing Systems
Chapter 13 Financial Statement Analysis
Chapter 14 Statement of Cash Flows
U
R
SE
,Fundamental Managerial Accounting Concepts, 9e (Edmonds)
Chapter 1 Management Accounting and Corporate Governance
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) Financial, economic, and nonfinancial data
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.
3) Choose the answer that is not a distinguishing characteristic of financial accounting
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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.
U
4) Managerial accounting information is limited or restricted by which of the following
authorities or principles?
R
A) Securities and Exchange Commission
B) Generally Accepted Accounting Principles
C) Managerial Accounting Standards Board
SE
D) Value-Added Principle
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.
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.
, 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.
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.
9) Which of the following is a product cost for a construction company?
A) Cost of transporting raw materials to the job site
B) Wages paid to the company's payroll clerk
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C) Rent of the company's main office
D) All of these.
10) For a manufacturing company, product costs include all of the following except:
A) indirect material costs.
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B) warehousing costs of finished goods.
C) direct labor costs.
D) All of these are product costs.
R
11) During its first year of operations, Connor Company paid $50,000 for direct materials and
$36,000 in wages for production workers. Lease payments and utilities on the production
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facilities amounted to $14,000. General, selling, and administrative expenses were $16,000. The
company produced 5,000 units and sold 4,000 units for $30.00 a unit. The average cost to
produce one unit is which of the following amounts?
A) $20.00
B) $16.00
C) $18.40
D) $25.00
12) During its first year of operations, Forrest Company paid $30,000 for direct materials and
$50,000 in wages for production workers. Lease payments, utility costs, and depreciation on
factory equipment totaled $15,000. General, selling, and administrative expenses were $20,000.
The average cost to produce one unit was $2.50. How many units were produced during the
period?
A) 40,000
B) 46,000
C) 38,000
D) None of these.
Fundamental Managerial Accounting Concepts, 9th Edition
Thomas P. Edmonds
JN
U
R
SE
,Table of Contents
Chapter 1 Management Accounting and Corporate Governance
Chapter 2 Cost Behavior, Operating Leverage, and Profitability Analysis
Chapter 3 Analysis of Cost, Volume, and Pricing to Increase Profitability
Chapter 4 Cost Accumulation, Tracing, and Allocation
Chapter 5 Cost Management in an Automated Business Environment:
ABC, ABM, and TQM
Chapter 6 Relevant Information for Special Decisions
Chapter 7 Planning for Profit and Cost Control
Chapter 8 Performance Evaluation
Chapter 9 Responsibility Accounting
Chapter 10 Planning for Capital Investments
Chapter 11 Product Costing in Service and Manufacturing Entities
JN
Chapter 12 Job-Order, Process, and Hybrid Costing Systems
Chapter 13 Financial Statement Analysis
Chapter 14 Statement of Cash Flows
U
R
SE
,Fundamental Managerial Accounting Concepts, 9e (Edmonds)
Chapter 1 Management Accounting and Corporate Governance
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) Financial, economic, and nonfinancial data
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.
3) Choose the answer that is not a distinguishing characteristic of financial accounting
JN
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.
U
4) Managerial accounting information is limited or restricted by which of the following
authorities or principles?
R
A) Securities and Exchange Commission
B) Generally Accepted Accounting Principles
C) Managerial Accounting Standards Board
SE
D) Value-Added Principle
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.
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.
, 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.
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.
9) Which of the following is a product cost for a construction company?
A) Cost of transporting raw materials to the job site
B) Wages paid to the company's payroll clerk
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C) Rent of the company's main office
D) All of these.
10) For a manufacturing company, product costs include all of the following except:
A) indirect material costs.
U
B) warehousing costs of finished goods.
C) direct labor costs.
D) All of these are product costs.
R
11) During its first year of operations, Connor Company paid $50,000 for direct materials and
$36,000 in wages for production workers. Lease payments and utilities on the production
SE
facilities amounted to $14,000. General, selling, and administrative expenses were $16,000. The
company produced 5,000 units and sold 4,000 units for $30.00 a unit. The average cost to
produce one unit is which of the following amounts?
A) $20.00
B) $16.00
C) $18.40
D) $25.00
12) During its first year of operations, Forrest Company paid $30,000 for direct materials and
$50,000 in wages for production workers. Lease payments, utility costs, and depreciation on
factory equipment totaled $15,000. General, selling, and administrative expenses were $20,000.
The average cost to produce one unit was $2.50. How many units were produced during the
period?
A) 40,000
B) 46,000
C) 38,000
D) None of these.
