Question 1

Managerial accounting has not changed in recent years because of:

Accepted Answer

A)  a growing service economy in Canada.
B)  the growing popularity of cross-functional teams.
C)  the need to focus on product quality.
D)  the shortening of product life cycles due to changes in technology.
E)  the lengthening of product life cycles due to changes in technology.

Question 2

Assume that a managerial accountant regularly communicates with business associates to avoid conflicts of interest and advises relevant parties of potential conflicts. In so doing, the accountant will have applied the ethical standard of:

Accepted Answer

A)  objectivity.
B)  confidentiality.
C)  integrity.
D)  credibility.
E)  unified behaviour. C

Question 3

Which of the following best describes the role of a staff position in an organization?

Accepted Answer

A)  It relates directly to the carrying out of the basic objectives of the organization.
B)  It is supportive in nature, providing service and assistance to other parts of the organization.
C)  It is superior in authority to a line position.
D)  It relates directly to the provision of the goods and services of the organization.
E)  It is superior in skill to a line position.

Question 4

Which of the following is not a function of the treasurer?

Accepted Answer

A)  Safeguarding assets.
B)  Managing investments.
C)  Preparing financial statements.
D)  Being responsible for a company's credit policy.
E)  Raising capital.

Question 5

The activities performed by a manufacturing organization could be categorized as pre-production (such as research and development and product design) , production-related, and post-production (such as marketing and customer service) . Which activities should the firm focus on if management understands the value chain concept and desires to meet organizational goals?

Accepted Answer

A)  Pre-production activities.
B)  Production-related activities.
C)  Post-production activities.
D)  Pre-production, production-related, and post-production activities.
E)  Pre-production and production-related activities only. D

Question 6

Which of the following employees would be considered as holding a line position within their respective organization?

Accepted Answer

A)  The Vice-President of Sunoco Canada.
B)  The Chief Financial Officer of General Motors Canada.
C)  A secretary employed by Rogers Communications.
D)  The manager of food and beverage services at Canada's Wonderland.
E)  The Controller at Roots Canada.

Question 7

A controller is normally involved with:

Accepted Answer

A)  preparing financial statements.
B)  managing investments.
C)  raising capital.
D)  safeguarding assets.
E)  managing the firm's credit policy.

Question 8

All three major professional accounting groups in Canada require their members to undertake professional development and/or continuing education. This practice is intended to directly satisfy which of these rules of ethical conduct?

Accepted Answer

A)  Integrity.
B)  Objectivity.
C)  Competence.
D)  Confidentiality.
E)  Due Care.

Question 9

DreamWorks Pictures produces both motion pictures for theaters as well as a variety of television series. Consider the seven activities that follow:
1. Auditions for actors and actresses
2. Development of promotional materials for use by local newspapers
3. Focus groups to evaluate ideas for potential television comedy series
4. Production of DVDs for release to Best Buy and Blockbuster Video
5. On-location shooting of scenes
6. Fine-tuning and rewrites of scripts
7. Set design and construction for new a medical drama
Required:
A. Evaluate the seven activities as upstream (pre-production), production, or downstream (post-production) in nature.
B. Generally speaking, which activities (upstream, production, or downstream), if any, can management ignore if the company is to be successful in achieving its key strategic goals?

Accepted Answer

A.
B.
None. All a...

Question 10

Which of the following is not an objective of managerial accounting?

Accepted Answer

A)  Providing information for decision making and planning.
B)  Assisting Managers in directing and controlling operations.
C)  Proactively participating as part of the management team in the decision-making and planning process.
D)  Measuring and evaluating the performance of managers and subunits.
E)  To strictly provide financial information to managers.

Question 11

Which of the following typically does not relate to the role of a controller?

Accepted Answer

A)  A controller supervises the personnel in the accounting department.
B)  A controller safeguards an organization's assets.
C)  A controller oversees the preparation of reports used in both financial and managerial accounting.
D)  A controller participates as an integral member of the management team.
E)  A controller is involved in planning and decision-making at all levels and across functional areas of the organization.

Question 12

Briefly distinguish between managerial accounting and financial accounting. Be sure to comment on the general focus, users, and regulation related to the two fields:

Accepted Answer

Managerial accounting is concerned with ...

Question 13

Which of the following statements represents a similarity between financial and managerial accounting?

Accepted Answer

A)  Both are useful in providing information for external users.
B)  Both are governed by GAAP.
C)  Both draw upon data from an organization's accounting system.
D)  Both rely heavily on published financial statements.
E)  Both are solely concerned with historical transactions.

Question 14

Fernbank Manufacturing Limited has set various goals, and management is now taking appropriate action to ensure that the firm achieves these goals. One such action is to reduce outlays for overhead, which have exceeded budgeted amounts. Which of the following functions best describes this process?

Accepted Answer

A)  Decision making.
B)  Planning.
C)  Coordinating.
D)  Controlling.
E)  Organizing. D

Question 15

Which of the following statements reflects a key concept of a JIT production system?

Accepted Answer

A)  The raw materials, work-in-process, and finished goods inventories of manufacturing companies act as buffers so that operations can proceed smoothly, even if suppliers are late with deliveries or departments are unable to operate for a brief period due to breakdowns or other reasons.
B)  The use of many suppliers ensures rapid delivery of materials for production.
C)  The maintenance of a stock of raw materials allows defective materials to be replaced quickly so as to maintain a high rate of productivity.
D)  Inventories are costly to carry and can be kept to minimum levels or eliminated completely with careful planning.
E)  Inventories of raw materials and parts, partially completed goods and finished goods are kept as a reserve against the possibility of running out.

Question 16

Which of the following employees at Starbucks would likely be considered as holding a line position?

Accepted Answer

A)  The company's treasurer.
B)  The company's senior legal advisor.
C)  The company's senior internal auditor.
D)  The company's chief financial officer.
E)  The Store Manager of the Kingston location.

Question 17

Financial accounting:

Accepted Answer

A)  is unregulated.
B)  produces information that is useful only for managers inside the organization.
C)  is based almost exclusively on historical transaction data.
D)  generally focuses on reporting information about departments and divisions.
E)  generally focuses on reporting information about the enterprise by subunits.

Question 18

A key use of managerial accounting information is the management of an organization's capacity and capacity costs. Define capacity in this context and describe the 2 concepts of an organization's capacity as discussed in Chapter 1. What important questions must the managerial accounting system address with respect to an organization's capacity?

Accepted Answer

Capacity is defined as the upper limit o...

Question 19

Which of the following statements about managerial accountants is false?

Accepted Answer

A)  In the past, managerial accountants operated in a strictly staff capacity.
B)  Managerial accountants often are part of cross-functional teams.
C)  An increasing number of organizations are segregating managerial accountants in separate managerial-accounting departments.
D)  In a number of companies, managerial accountants make significant business decisions and resolve operating problems.
E)  The role of managerial accountants has changed considerably over the past decade.

Question 20

Ken Franklin is the sales manager of Davidson Enterprises, a very profitable distributor of office furniture to local businesses. A recent economic downturn has created an extremely tight cash position, and the company has been hurt by the bankruptcy of two key customers.
In late October, anticipating an economic recovery, Franklin began an extensive remodeling of the company's sales floor. Construction costs, decorating, and equipment purchases are projected to cost $250,000.
Davidson has a policy that states that individual expenditures in excess of $200,000 must be approved by the firm's Board of Directors. Franklin, unfortunately, missed the deadline to have the board consider this project at its regular September meeting. Not wanting to wait until the next meeting in December, he subdivided the project in two parts-construction and decorating ($190,000) and equipment purchases ($60,000)-neither of which needed board approval because of the dollar amounts involved.
The project was recently completed and sales have begun to recover. Customers have raved about the new sales area, noting that it is far superior to those of Davidson's competitors.
Required:
A. Would Franklin's approach of subdividing the project in two parts have any effect on the company's financial statements? Briefly explain.
B. Briefly discuss whether Franklin behaved in an ethical manner.
C. Which, if any, of the following standards of conduct would have applicability to Franklin's conduct: competence, confidentiality, integrity, or credibility? Briefly explain.

Accepted Answer

A. Although some extra processing is inv...

Exam 1: The Changing Role of Managerial Accounting

Managerial accounting has not changed in recent years because of:

Correct Answer
verified

Assume that a managerial accountant regularly communicates with business associates to avoid conflicts of interest and advises relevant parties of potential conflicts. In so doing, the accountant will have applied the ethical standard of:

Correct Answer
verified
C

Which of the following best describes the role of a staff position in an organization?

Correct Answer
verified

Which of the following is not a function of the treasurer?

Correct Answer
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Correct Answer
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D

Which of the following employees would be considered as holding a line position within their respective organization?

Correct Answer
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A controller is normally involved with:

Correct Answer
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All three major professional accounting groups in Canada require their members to undertake professional development and/or continuing education. This practice is intended to directly satisfy which of these rules of ethical conduct?

Correct Answer
verified

Correct Answer
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A.
B.
None. All a...
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Which of the following is not an objective of managerial accounting?

Correct Answer
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Which of the following typically does not relate to the role of a controller?

Correct Answer
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Briefly distinguish between managerial accounting and financial accounting. Be sure to comment on the general focus, users, and regulation related to the two fields:

Correct Answer
verified
Managerial accounting is concerned with ...
View Answer

Which of the following statements represents a similarity between financial and managerial accounting?

Correct Answer
verified

Fernbank Manufacturing Limited has set various goals, and management is now taking appropriate action to ensure that the firm achieves these goals. One such action is to reduce outlays for overhead, which have exceeded budgeted amounts. Which of the following functions best describes this process?

Correct Answer
verified
D

Which of the following statements reflects a key concept of a JIT production system?

Correct Answer
verified

Which of the following employees at Starbucks would likely be considered as holding a line position?

Correct Answer
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Financial accounting:

Correct Answer
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Correct Answer
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Capacity is defined as the upper limit o...
View Answer

Which of the following statements about managerial accountants is false?

Correct Answer
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Correct Answer
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A. Although some extra processing is inv...
View Answer

Exam 1: The Changing Role of Managerial Accounting

Managerial accounting has not changed in recent years because of:

Correct AnswerverifiedShow Answer

Assume that a managerial accountant regularly communicates with business associates to avoid conflicts of interest and advises relevant parties of potential conflicts. In so doing, the accountant will have applied the ethical standard of:

Correct AnswerverifiedC

Which of the following best describes the role of a staff position in an organization?

Correct AnswerverifiedShow Answer

Which of the following is not a function of the treasurer?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedD

Which of the following employees would be considered as holding a line position within their respective organization?

Correct AnswerverifiedShow Answer

A controller is normally involved with:

Correct AnswerverifiedShow Answer

All three major professional accounting groups in Canada require their members to undertake professional development and/or continuing education. This practice is intended to directly satisfy which of these rules of ethical conduct?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedA. B. None. All a...View AnswerShow Answer

Which of the following is not an objective of managerial accounting?

Correct AnswerverifiedShow Answer

Which of the following typically does not relate to the role of a controller?

Correct AnswerverifiedShow Answer

Briefly distinguish between managerial accounting and financial accounting. Be sure to comment on the general focus, users, and regulation related to the two fields:

Correct AnswerverifiedManagerial accounting is concerned with ...View AnswerShow Answer

Which of the following statements represents a similarity between financial and managerial accounting?

Correct AnswerverifiedShow Answer

Fernbank Manufacturing Limited has set various goals, and management is now taking appropriate action to ensure that the firm achieves these goals. One such action is to reduce outlays for overhead, which have exceeded budgeted amounts. Which of the following functions best describes this process?

Correct AnswerverifiedD

Which of the following statements reflects a key concept of a JIT production system?

Correct AnswerverifiedShow Answer

Which of the following employees at Starbucks would likely be considered as holding a line position?

Correct AnswerverifiedShow Answer

Financial accounting:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedCapacity is defined as the upper limit o...View AnswerShow Answer

Which of the following statements about managerial accountants is false?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedA. Although some extra processing is inv...View AnswerShow Answer

Correct Answer
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Correct Answer
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C

Correct Answer
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Correct Answer
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D

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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A.
B.
None. All a...
View Answer

Correct Answer
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Correct Answer
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Correct Answer
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Managerial accounting is concerned with ...
View Answer

Correct Answer
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Correct Answer
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D

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Correct Answer
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Correct Answer
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Correct Answer
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Capacity is defined as the upper limit o...
View Answer

Correct Answer
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Correct Answer
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A. Although some extra processing is inv...
View Answer