(Test Bank) Managerial Accounting Canadian Edition

Garrison, 12

Business

Test Bank

12th Edition

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Test Bank for Managerial Accounting Canadian Edition, The downloadable file consists of 1658 pages, and the total size of the file is 11.9 MB. Purchase now only for highly discounted price.

Author(s): Garrison

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Chapter 01 - Managerial Accounting and the Business Environment 1-1 Chapter 01 Managerial Accounting and the Business Environment Multiple Choice Questions 1. Day-to-day decision making is most common to which of the following activities managers are expected to carry on in organizations? A. Strategy formulation. B. Directing and motivating. C. Planning. D. Budgeting. Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Medium Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-02 The Work of Managers and their Need for Managerial Accounting Information 2. Identifying alternatives and selecting the best among them is part of which of the following activities managers carry out in organizations? A. Controlling. B. Directing. C. Decision making. D. Motivating. Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Medium Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-06 Decision Making Chapter 01 - Managerial Accounting and the Business Environment 1-2 3. Budgeting is part of which of the following activities managers perform in organizations? A. Controlling. B. Directing. C. Planning. D. Motivating. Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Easy Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-03 Planning 4. Obtaining feedback is generally identified most directly with which of these functions of management? A. Planning. B. Directing and motivating. C. Controlling. D. Decision making. Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Easy Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-05 Controlling 5. Unstructured forms of big data include all of the following except: A. videos. B. memos. C. pictures. D. audios. Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-07 Big Data Chapter 01 - Managerial Accounting and the Business Environment 1-3 6. Five V's of big data include all of the following except: A. variety. B. value. C. volume. D. variable. Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-07 Big Data 7. Which is the most common risk management tactic? A. Accept the risk. B. Avoid the risk. C. Reduce the risk. D. Share the risk. Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-03 Explain the basic concept of enterprise risk management. Topic: 01-18 Enterprise Risk Management 8. Which of the following best describes the function of managerial accounting within an organization? A. It has its primary emphasis on the future. B. It is required by regulatory bodies such as the Ontario Securities Commission. C. It focuses on the organization as a whole, rather than on the organization's segments. D. It places more emphasis on precision of data than financial accounting does. Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-02 Identify the major differences and similarities between financial and managerial accounting. Topic: 01-10 Comparison of Financial and Managerial Accounting Chapter 01 - Managerial Accounting and the Business Environment 1-4 9. Upon which of the following does managerial accounting place considerable weight? A. Generally accepted accounting principles. B. The financial history of the entity. C. Ensuring that all transactions are properly recorded. D. Detailed segment reports about departments, products, and customers. Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Easy Learning Objective: 01-02 Identify the major differences and similarities between financial and managerial accounting. Topic: 01-13 Less Emphasis on Precision 10. For internal uses, managers are more concerned with receiving information that achieves which of the following standards? A. Completely objective and verifiable. B. Completely accurate and precise. C. Relevant, flexible, and timely. D. Relevant, completely accurate, and precise. Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Easy Learning Objective: 01-02 Identify the major differences and similarities between financial and managerial accounting. Topic: 01-11 Emphasis on the Future 11. Which of the following would be an example of a performance report? A. An income statement reporting actual results for the past month. B. An income statement showing the amounts budgeted for the past month. C. A balance sheet showing the actual financial position at the end of the past month. D. A production report showing budgeted and actual production for the past month. Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Hard Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-05 Controlling Chapter 01 - Managerial Accounting and the Business Environment 1-5 12. Which of the following is NOT a value propositions discussed in the text? A. Customer intimacy B. Discount pricing C. Operational excellence D. Innovation Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Medium Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-09 Strategic Management 13. Which one of the following is NOT an example of corporate social responsibility? A. Safe, high- quality products that are fairly priced. B. Full disclosure of product related risks. C. Opportunities for training, promotion, and personal development. D. Easy-to-use information systems for shopping and tracking orders. Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Medium Learning Objective: 01-05 Explain the elements of corporate social responsibility. Topic: 01-20 Corporate Social Responsibility 14. Which one of the following is NOT an activity in the controlling stage? A. Comparing actual to planned performance. B. Preparing an estimate for raw materials are released to production. C. Preparing performance reports D. Measuring performance Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Medium Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-03 Planning Topic: 01-05 Controlling Topic: 01-06 Decision Making Chapter 01 - Managerial Accounting and the Business Environment 1-6 15. Which of the following is NOT an example of a business risk? A. Products harming customers. B. A website malfunctioning. C. A customer value proposition. D. An employee accessing unauthorized information. Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Medium Learning Objective: 01-03 Explain the basic concept of enterprise risk management. Topic: 01-18 Enterprise Risk Management 16. Professional accounting body in Canada (CPA) 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 in line with other code of ethics? A. Integrity. B. Objectivity. C. Competence. D. Confidentiality. Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Medium Learning Objective: 01-04 Explain the nature and importance of ethics for accountants. Topic: 01-19 Ethics 17. Samantha Galloway is a managerial accountant in the accounting department of Mustang Industries, Inc. Samantha has just discovered evidence that some of the corporation's marketing managers have been wrongfully inflating their expense reports to obtain higher reimbursements from the firm. What should Samantha do upon discovering this evidence? A. Notify the controller. B. Notify the marketing managers involved. C. Notify the president of the corporation. D. Ignore the evidence because she is not part of the Marketing Department. Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Hard Learning Objective: 01-04 Explain the nature and importance of ethics for accountants. Topic: 01-19 Ethics Chapter 01 - Managerial Accounting and the Business Environment 1-7 18. Both financial and managerial accounting rely on the same underlying financial data but there are major differences. Managerial Accounting: A. emphasizes financial consequences of past activities. B. emphasizes precision. C. emphasizes relevance. D. must follow IFRS. Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Medium Learning Objective: 01-02 Identify the major differences and similarities between financial and managerial accounting. Topic: 01-10 Comparison of Financial and Managerial Accounting Topic: 01-11 Emphasis on the Future Topic: 01-12 Relevance of Data 19. Ajit, the production manager at Guelph Manufacturing Company decided to choose a supplier with a proven track record instead of a new supplier that offers significant price incentives. This is an example of: A. Risk avoiding B. Risk accepting C. Risk sharing D. Risk taking Accessibility: Keyboard Navigation Blooms: Analyze Difficulty: Hard Learning Objective: 01-03 Explain the basic concept of enterprise risk management. Topic: 01-18 Enterprise Risk Management 20. Series of steps that are followed to carry out some task or activity in a business is called: A. Business cycle. B. Business activity. C. Business process. D. Business strategy. Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-03 Explain the basic concept of enterprise risk management. Topic: 01-18 Enterprise Risk Management Chapter 01 - Managerial Accounting and the Business Environment 1-8 21. Which of the following groups should be the focal point of a company's strategy? A. Employees B. Board of directors C. Shareholders D. Target customers Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Hard Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-08 The Planning and Control Cycle 22. The purpose of IFRS is: A. To encourage Strategic planning. B. To enhance the comparability and clarity of financial information on a global basis. C. To encourage disclosure of Non-Financial data. D. To change how management accountants prepare reports. Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Medium Learning Objective: 01-02 Identify the major differences and similarities between financial and managerial accounting. Topic: 01-14 Segments of an Organization 23. In Canada, CPA Code of Ethics is an instrument for enforcing professional conduct for its members and comprise the following: A. Level of competence, confidentiality, integrity, due care and objectivity B. Level of competence, confidentiality and integrity C. Level of competence, confidentiality and objectivity D. Level of competence, integrity and objectivity Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Medium Learning Objective: 01-04 Explain the nature and importance of ethics for accountants. Topic: 01-20 Corporate Social Responsibility Chapter 01 - Managerial Accounting and the Business Environment 1-9 24. Which of the following is the stakeholder group whose interests are to be directly and formally protected by effective corporate social responsibility? A. Customers B. Creditors C. All Stakeholders D. Suppliers Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Medium Learning Objective: 01-05 Explain the elements of corporate social responsibility. Topic: 01-21 Leadership True / False Questions 25. An important part of planning is to identify alternatives and then to select from among the alternatives the one that best meets the organization's objectives. TRUE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Medium Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-03 Planning 26. Big Data refers to the information gathered from insider sources only. FALSE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-07 Big Data Chapter 01 - Managerial Accounting and the Business Environment 1-10 27. Companies should identify foreseeable risks before they occur rather than react to unfortunate events that have already happened. TRUE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Medium Learning Objective: 01-03 Explain the basic concept of enterprise risk management. Topic: 01-18 Enterprise Risk Management 28. A value chain consists of the major business functions that add value to a company's products and services. TRUE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-03 Explain the basic concept of enterprise risk management. Topic: 01-16 Managerial Accounting—Not Mandatory 29. Managerial accounting places less emphasis on precision and more emphasis on timeliness of data than financial accounting does. TRUE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Medium Learning Objective: 01-02 Identify the major differences and similarities between financial and managerial accounting. Topic: 01-12 Relevance of Data 30. Managerial accounting is NOT governed by generally accepted accounting principles (GAAP). TRUE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-02 Identify the major differences and similarities between financial and managerial accounting. Topic: 01-14 Segments of an Organization Topic: 01-15 Generally Accepted Accounting Principles Chapter 01 - Managerial Accounting and the Business Environment 1-11 31. In general, accounting data serve both financial accounting and managerial accounting purposes. TRUE Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Easy Learning Objective: 01-02 Identify the major differences and similarities between financial and managerial accounting. Topic: 01-10 Comparison of Financial and Managerial Accounting Topic: 01-11 Emphasis on the Future Topic: 01-12 Relevance of Data 32. Product harming customers is NOT a business risk. FALSE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-03 Explain the basic concept of enterprise risk management. Topic: 01-18 Enterprise Risk Management 33. Managerial accounting plays a critical role in providing information to management to facilitate implementing and monitoring strategy. TRUE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-08 The Planning and Control Cycle 34. To reduce the likelihood that employees will engage in undesirable activities that may harm various stakeholders, many companies prepare a formal code of conduct to reflect their values and moral system. TRUE Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Medium Learning Objective: 01-04 Explain the nature and importance of ethics for accountants. Topic: 01-20 Corporate Social Responsibility Chapter 01 - Managerial Accounting and the Business Environment 1-12 35. Emphasis on the future is given equal weight by both managerial accounting and financial accounting. FALSE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-02 Identify the major differences and similarities between financial and managerial accounting. Topic: 01-10 Comparison of Financial and Managerial Accounting 36. Managerial accounting plays a critical role in providing information to management to facilitate strategy implementation and monitoring. TRUE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-08 The Planning and Control Cycle 37. Thorough testing of a product before launching in the mass market is a risk reduction strategy. TRUE Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Medium Learning Objective: 01-03 Explain the basic concept of enterprise risk management. Topic: 01-18 Enterprise Risk Management 38. A customer value proposition is essentially a reason for customers to choose a company's products over its competitors' products. TRUE Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Medium Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-08 The Planning and Control Cycle Chapter 01 - Managerial Accounting and the Business Environment 1-13 39. Customer value propositions tend to fall into three broad categories--customer intimacy, operational excellence, and product leadership. TRUE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-08 The Planning and Control Cycle 40. Companies that adopt a customer intimacy strategy are in essence saying to their target customers, "The reason you should choose us is because we understand and respond to your individual needs better than our competitors." TRUE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-08 The Planning and Control Cycle 41. Companies that choose an operational excellence strategy are in essence saying to their customers, "Choose us rather than our competitors because we strive for zero defects." FALSE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Medium Learning Objective: 01-01 Describe the functions performed by managers. Topic: 01-08 The Planning and Control Cycle 42. Many organizations use extrinsic incentives to highlight important goals and to motivate employees to achieve them. TRUE Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Medium Learning Objective: 01-06 Explain how intrinsic motivation, extrinsic incentives, and cognitive biases affect employee behaviour. Topic: 01-22 Intrinsic Motivation Chapter 01 - Managerial Accounting and the Business Environment 1-14 43. Paying a bonus for exceeding the sales target is an example of extrinsic incentive. TRUE Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Medium Learning Objective: 01-06 Explain how intrinsic motivation, extrinsic incentives, and cognitive biases affect employee behaviour. Topic: 01-23 Extrinsic Incentives 44. Managerial accounting is not mandatory. TRUE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-02 Identify the major differences and similarities between financial and managerial accounting. Topic: 01-15 Generally Accepted Accounting Principles 45. Many customers seek to purchase products and services from socially responsible companies. TRUE Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 01-05 Explain the elements of corporate social responsibility. Topic: 01-20 Corporate Social Responsibility 46. Professional organizations like CPA Canada can punish companies if they violate the code of ethics. FALSE Professional organizations can punish its members not the companies. Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Medium Learning Objective: 01-04 Explain the nature and importance of ethics for accountants. Topic: 01-19 Ethics Chapter 01 - Managerial Accounting and the Business Environment 1-15 Short Answer Questions 47. Compare financial and managerial accounting with respect to the following: a. Audience b. Format and data presentation c. Data accuracy and precision a. Financial Accounting Reports to those outside the organization: Owners Creditors Tax Authorities Regulators while Managerial Accounting Reports to those inside the organization for: Planning Directing and motivating Controlling Decision making. b. Financial Accounting must follow GAAP/ASPE/IFRS and summary data concerning the entire organization. Managerial Accounting need snot follow GAAP/ASPE/IFRS and emphasizes detailed segment reports about departments, products, and customers. c. Financial Accounting emphasizes objectivity and verifiability and precision. Managerial Accounting is focused on relevance and timeliness. (answers may vary) Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Medium Learning Objective: 01-03 Explain the basic concept of enterprise risk management. Topic: 01-10 Comparison of Financial and Managerial Accounting