TESTBANK&SOLUTION MANUAL FOR Managerial Accounting Tools for Business Decision Making, 6th Canadian Edition, Jerry Weygandt, Paul Kimmel, Ibrahim Aly

TESTBANK&SOLUTION MANUAL FOR Managerial AccountingTools for Business Decision Making, 6th Canadian Edition, Jerry Weygandt, Paul Kimmel, Ibrahim Aly CHAPTER 1 MANAGERIAL ACCOUNTING SUMMARY OF QUESTION TYPES BY LEARNING OBJECTIVE, BLOOM’S TAXONOMY, LEVEL OF DIFFICULTY, AACSB CODES, AND CPA CODES Item LOBTLODAACSB CPA Item LO BT LODAACSB CPA Item LO BT LODAACSB CPA True-False Statements 1. 1 C E AN MA 3. 2 K E AN MA 5. 4 K E AN MA 2. 1 C E AN MA 4. 2 K E AN MA Multiple Choice Questions 6. 1 K E AN MA 36. 2 K E AN MA 66. 4 C E AN MA 7. 1 K E AN MA 37. 2 C E AN MA 67. 4 K E AN MA 8. 1 K E AN MA 38. 2 K E AN MA 68. 4 K E AN MA 9. 1 C E AN MA 39. 2 K E AN MA 69. 4 C E AN MA 10. 1 K E AN MA 40. 3 C E E MA 70. 4 C E AN MA 11. 1 C E AN MA 41. 3 C E E MA 71. 4 K E AN MA 12. 1 K E AN MA 42. 3 K E AN MA 72. 4 K E AN MA 13. 1 K E AN MA 43. 3 K E AN MA 73. 4 C E AN MA 14. 1 C E AN MA 44. 3 K E AN MA 74. 4 K E AN MA 15. 1 K E AN MA 45. 3 K E AN MA 75. 4 C E AN MA 16. 1 C E AN MA 46. 3 C E AN MA 76. 4 C E AN MA 17. 1 C E AN MA 47. 3 K E AN MA 77. 4 C E AN MA 18. 1 K E AN MA 48. 3 K E AN MA 78. 4 AN M AN MA 19. 1 K E AN MA 49. 3 C E AN MA 79. 4 K E AN MA 20. 1 K E AN MA 50. 3 C E AN MA 80. 4 K E AN MA 21. 1 C E AN MA 51. 3 K E AN MA 81. 4 C E AN MA 22. 1 K E AN MA 52. 3 K E AN MA 82. 4 K E AN MA 23. 1 K E AN MA 53. 4 C E AN MA 83. 4 K E AN MA 24. 1 K E AN MA 54. 4 K E AN MA 84. 4 K E AN MA 25. 1 K E AN MA 55. 4 K E AN MA 85. 4 K E AN MA 26. 2 C E AN MA 56. 4 K E AN MA 86. 4 K E AN MA 27. 2 K E AN MA 57. 4 K E AN MA 28. 2 K E AN MA 58. 4 K E AN MA 29. 2 K E AN MA 59. 4 C E AN MA 30. 2 K E AN MA 60. 4 C E AN MA 31. 2 K E AN MA 61. 4 C E AN MA 32. 2 K E AN MA 62. 4 K E AN MA 33. 2 C E AN MA 63. 4 K E AN MA 34. 2 K E AN MA 64. 4 K E AN MA 35. 2 C E AN MA 65. 4 C E AN MA Bloom’s: AN = Analysis C = Comprehension K = Knowledge LOD: E = Easy M = Medium H = Hard AACSB: AN = Analytic E = Ethics CPA: MA = Management Accounting Copyright © 2021 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited 1 - 2 Test Bank for Managerial Accounting, Sixth Canadian Edition SUMMARY OF QUESTION TYPES BY LEARNING OBJECTIVE, BLOOM’S TAXONOMY, LEVEL OF DIFFICULTY, AACSB CODES, AND CPA CODES (CONT’D) Item LO BT LOD AACSB CPA Item LO BT LOD AACSB CPA Item LO BT LODAACSB CPA Brief Exercises 87. 1 C E AN MA 90. 3 C E E MA 93. 4 C E AN MA 88. 2 C E AN MA 91. 3 C E E MA 94. 4 K E AN MA 89. 2 C E AN MA 92. 4 K E AN MA 95. 4 C E AN MA Exercises 96. 1 C E AN MA 100. 2 K E AN MA 104. 1,4 AN M AN MA 97. 1,2 AN M AN MA 101. 3 C E AN MA 105. 4 AN M AN MA 98. 2 C E AN MA 102. 3 C E AN MA 99. 2 AN M AN MA 103. 3 C E AN MA Completion Statements 106. 1 K E AN MA 108. 1 K E AN MA 110. 2 K E AN MA 107. 1 K E AN MA 109. 2 K E AN MA 111. 2 K E AN MA Matching 112. 4 K E AN MA Short-Answer Essay 113. 1 C E AN MA 115. 3 AN M AN MA 117. 4 C E AN MA 114. 2 C E AN MA 116. 3 C E AN MA Bloom’s: AN = Analysis C = Comprehension K = Knowledge LOD: E = Easy M = Medium H = Hard AACSB: AN = Analytic E = Ethics CPA: MA = Management Accounting Copyright © 2021 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited. Managerial Accounting 1 - 3 SUMMARY OF LEARNING OBJECTIVES BY QUESTION TYPE Item Type Item Type Item Type Item Type Item Type Item Type Item Type Learning Objective 1 1. TF 10. MC 16. MC 21. MC 96. Ex 113. SAE 2. TF 11. MC 17. MC 22. MC 97. Ex 6. MC 12. MC 18. MC 23. MC 104. Ex 7. MC 13. MC 19. MC 24. MC 106. C 8. MC 14. MC 20. MC 25. MC 107. C 9. MC 15. MC 21. MC 87. BE 108 C Learning Objective 2 3. TF 28. MC 32. MC 36. MC 88. BE 110. C 4. TF 29. MC 33. MC 37. MC 89. BE 111. C 26. MC 30. MC 34. MC 38. MC 97. Ex 114. SAE 27. MC 31. MC 35. MC 39. MC 109. C Learning Objective 3 40. MC 44. MC 48. MC 52. MC 102. Ex 41. MC 45. MC 49. MC 90. BE 103. Ex 42. MC 46. MC 50. MC 91. BE 115. SAE 43. MC 47. MC 51. MC 101. Ex 116. SAE Learning Objective 4 5. TF 59. MC 66. MC 73. MC 80. MC 92. BE 117. SAE 53. MC 60. MC 67. MC 74. MC 81. MC 93. BE 54. MC 61. MC 68. MC 75. MC 82. MC 94. BE 55. MC 62. MC 69. MC 76. MC 83. MC 95. BE 56. MC 63. MC 70. MC 77. MC 84. MC 104. Ex 57. MC 64. MC 71. MC 78. MC 85. MC 105. Ex 58. MC 65. MC 72. MC 79. MC 86. MC 112. Ma Note: TF = True-False C = Completion BE = Brief Exercise MC = Multiple Choice Ex = Exercise SAE = Short-Answer Essay Ma = Matching Copyright © 2021 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited. 1 - 4 Test Bank for Managerial Accounting, Sixth Canadian Edition CHAPTER LEARNING OBJECTIVES Explain the distinguishing features of managerial accounting. Managerial accounting is needed in all types of businesses—service, merchandising, and manufacturing. It also applies to all forms of business organization—proprietorships, partnerships, and corporations. Managerial accounting is needed in not-for-profit entities, as well as in profit-oriented enterprises. Managerial accounting provides tools that help management make decisions and evaluate the effectiveness of those decisions. The distinguishing features of managerial accounting are the primary users of reports—internal users, who are officers, department heads, managers, and supervisors in the company; the type and frequency of reports—internal reports that are issued as frequently as needed; the purpose of reports—to provide special-purpose information for a particular user for a specific decision; the content of reports—pertains to subunits of the business and may be very detailed and may extend beyond the double-entry accounting system; the reporting standard is relevantto the decision being made; and the verification of reports—no independent audits. Identify the three broad functions of management and the role of management accountants in an organizational structure. The three functions are planning, directing, and controlling. Planning requires management to look ahead and to establish objectives. Directing involves coordinating a company’s diverse activities and human resources to produce a smoothly running operation. Controlling is the process of keeping the activities on track. Management accountants serve as staff members in an organization and play an important role in providing the required information for decision making. Explain the importance of business ethics. All employees in an organization are expected to act ethically in their business activities. In Canada, the professional accounting organization promotes high standards of ethics in the accounting profession. These standards of ethics can be used as guidelines in dealing with the public and the organizations’ members. In the United States, the Institute of Management Accountants’ Statement of Ethical Professional Practice provides the codes of conduct. Moreover, companies are now evaluating their performance with regard to their corporate social responsibility. Identify changes and trends in managerial accounting. Managerial accounting has experienced many changes in recent years. Among these are a shift toward meeting the needs of service companies and improving practices to better meet the needs of managers. Improved practices include a focus on managing the value chain through techniques such as just-in-time inventory and technological applications such as enterprise resource planning (ERP). In addition, techniques have been developed to improve decisionmaking, such as the theory of constraints and activity-based costing (ABC). Finally, many companies now use the balanced scorecard and data analytics in order to have a more comprehensive view of the company’s operations. Data analytics is important in business to understand problems facing an organization, and to use data to both predict and influence customer behaviour. Copyright © 2021 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited. Managerial Accounting 1 - 5 In Canada, the accounting profession has recently been reorganized by the founding of CPA Canada (Chartered Professional Accountants of Canada) in 2013, into which the three legacy accounting bodies—Chartered Accountants (CA), Certified Management Accountants (CMA), and Certified General Accountants (CGA)—were merged. Copyright © 2021 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited. 1 - 6 Test Bank for Managerial Accounting, Sixth Canadian Edition TRUE-FALSE STATEMENTS Management accounting and financial accounting, while in the same field, are mutually exclusive disciplines. Given the decision to employ straight-line amortization or a usage-based amortization method, the management accountant’s need to report the most relevant economic information to external users will determine which method is used. Decision making is an integral part of the planning, directing, and motivating functions, but notof the controlling function. Employees with staff positions serve other employees, while those with line positions work directly in line with the company’s revenue generating goals. Activity-based costing is a method of allocating overhead costs to products. Copyright © 2021 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited. Managerial Accounting 1 - 7 ANSWERS TO TRUE-FALSE STATEMENTS Item Ans. Item Ans. Item Ans. Item Ans. Item Ans. 1. F 2. F 3. F 4. T 5. T Copyright © 2021 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited. 1 - 8 Test Bank for Managerial Accounting, Sixth Canadian Edition MULTIPLE CHOICE QUESTIONS Managerial accounting information generally pertains to an entity as a whole and is very detailed. applies only to manufacturing companies. focuses primarily on reports for both internal and external users. provides tools that help management make decisions and evaluate the effectiveness of those decisions. Reports scrutinized by managerial accountants do not include those focused on business subunits. do not include non-financial data relevant to business decision making. are highly aggregated. are special purpose for specific decisions. Managerial accounting is concerned with costing products. is governed by generally accepted accounting principles. pertains to the entity as a whole and is highly aggregated. places emphasis on special-purpose information. Managerial accounting information is generally prepared for shareholders. managers. regulatory agencies. investors. Managerial accounting information pertains to the entity as a whole and is highly aggregated. must be prepared according to generally accepted accounting principles. pertains to subunits of the entity and may be detailed. is prepared only once a year. The major reporting standard for management accounting is the Standards of Ethical Conduct for Practitioners of Management Accounting and Financial Management. the Sarbanes-Oxley Act of 2002. relevance to decisions. generally accepted accounting principles. Managerial accounting applies to which of the following forms of business organizations? sole proprietorship partnership corporation Copyright © 2021 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited. Managerial Accounting 1 - 9 all forms of business organizations Which of the following is false in terms of the reason companies replace a CEO with a management committee? To enhance decision-making To improve collaboration. To avoid disruption associated with replacing a CEO. To reduce management continuity. Managerial accounting is also called inside reporting. cost accounting. management accounting. strategic management. Which of the following is not an internal user? corporate officers staff employees stockholders department manager Which of the following is not part of managerial accounting? determining whether planned goals are being met reporting financial information to the shareholders calculating product costs controlling costs Which of the following uses managerial accounting? manufacturing and service entities, but not merchandising profit-oriented businesses only service, manufacturing, and merchandising entities only manufacturing entities Which one of the following tasks would not be performed by a management accountant? being concerned with the impact of cost and volume on profits strategic cost management assisting in budget planning preparing reports primarily for external users How often are internal managerial reports communicated? as frequently as needed annually during every audit by the company’s CPA monthly Copyright © 2021 John Wiley & Sons Canada, Ltd. Unauthorized copying, distribution, or transmission of this page is prohibited. 1 - 10 Test Bank for Managerial Accounting, Sixth Canadian Edition Which description identifies financial statements that are prepared for external users? external reports special purpose user-specific general-purpose Which term describes managerial accounting reports? GAAP reports special purpose general-purpose regulatory reports Which of the following statements about internal reports is true? Most internal reports are summarized rather than detailed. Internal reports focus on general-purpose needs of users. The content of internal reports extends beyond the double-entry accounting system. Internal reports are often very general. Which one of the following describes internal reports? They are often audited by CPAs. They must be prepared according to GAAP. They are aggregated. They are detailed. Which of the following reports would management find useful in decision making? monthly reports on activities to the Board of Directors quarterly reporting to the Toronto Stock Exchange specific purpose statements on services delivered audited financial information in the annual report to shareholders How often should management receive or prepare reports on its internal process activities? on a fixed time basis as often as is necessary never more than monthly weekly How often should management receive or prepare reports on its external business process activities? as they correspond to external financial reporting never more than monthly according to the company’s business cycle as often as is necessary