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Accounting Topic 1

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202 accounting Quiz on Accounting Topic 1, created by stevensae on 03/05/2015.
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Quiz by stevensae, updated more than 1 year ago
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Created by stevensae over 9 years ago
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Resource summary

Question 1

Question
The primary users of management accounting information are typically:
Answer
  • Politicians, Bankers, and the IRS
  • Shareholders and others who can use it to sue the corporation and get rich
  • Managers within the organization
  • all stakeholders of the organization
  • all of the above

Question 2

Question
The Management Accountants' Ethics code states that when faced with significant ethical issues, management accountants should first:
Answer
  • discuss such problems with the President of the organization except when it appears that the President is involved.
  • clarify relevant concepts by confidential discussion with an objective advisor to obtain an understanding of possible courses of action.
  • follow the established policies of the organization bearing on the resolution of such conflict.
  • submit and informative memorandum describing the ethical issue to an appropriate representative of the organization and resign if no action is taken as a result of the memorandum

Question 3

Question
Managerial accounting:
Answer
  • has its primary emphasis on the future
  • is required by regulatory bodies such as SEC
  • focuses on the organization as a whole, rather than on the organization's segments.
  • all the above.

Question 4

Question
The three basic elements of manufacturing cost are:
Answer
  • cost of goods manufactured
  • cost of goods sold
  • work in process
  • manufacturing overhead
  • direct material
  • direct labor

Question 5

Question
Transportation costs incurred by a manufacturing company to ship its product to its customers would be classified as which of the following?
Answer
  • Product cost
  • manufacturing overhead
  • period cost
  • administrative cost

Question 6

Question
Cost of goods manufactured will usually include
Answer
  • only costs incurred during the current period
  • only direct labor and direct materials costs
  • some costs incurred during the prior period as well as costs incurred during the current period
  • some period costs as well as some product costs

Question 7

Question
which one of the following costs should NOT be considered an indirect cost of serving a particular customer at a Dairy Queen fast food outlet?
Answer
  • a cost of the hamburger patty in the burger they ordered
  • the wages of the employee who takes the customer's order
  • the cost of heating and lighting the kitchen
  • the salary of the outlet's manager

Question 8

Question
The cost of goods sold in a merchandising company typically would be classified as a
Answer
  • fixed cost
  • variable cost
  • step-variable cost
  • mixed cost

Question 9

Question
The contribution approach to the income statement:
Answer
  • organizes costs on a functional basis
  • is useful to managers in planning and decision making
  • shows a contribution margin rather than a net operating income figure at the bottom of the statement
  • can be used only by manufacturing companies

Question 10

Question
On a cost-volume-profit graph, the break-even point is located
Answer
  • at the origin
  • where the total revenue line intersects the volume axis
  • where the total expenses line intersects the dollars axis
  • where the total revenue

Question 11

Question
Which of the following is true regarding the contribution margin ratio of a single product company?
Answer
  • as fixed expenses decrease, the contribution margin ratio increases
  • the contribution margin ratio multiplied by the variable expense per unit equal the contribution margin per unit
  • if sales increase, the dollar increase in net operating income can be computed by multiplying the contribution margin ratio by the dollar increase in sales
  • the contribution margin ratio increases as the number of units sold increases

Question 12

Question
a company increased the selling price for its product from $5 to $6 per unit when total fixed expenses increased from $100,000 to $200,000 and variable expense per unit remained unchanged. How would these changes affect the breakeven point?
Answer
  • the break-even point in units would decrease
  • the break-even point in units would increase
  • the break-even point in units would remain unchanged
  • the effect cannot be determined from the information given

Question 13

Question
Financial accounting reports are prepared for external parties, whereas managerial accounting reports are prepared for internal users.
Answer
  • True
  • False

Question 14

Question
Financial accounting is more focused on precision when making reports. Managerial accounting provides decision makers with good estimates ASAP and precise data later.
Answer
  • True
  • False

Question 15

Question
Managerial accounting focuses on the company as a whole, financial accounting focuses on segment reports.
Answer
  • True
  • False

Question 16

Question
Financial accounting must follow GAAP and IRS guidelines. Managerial accounting doesn't have externally imposed rules.
Answer
  • True
  • False

Question 17

Question
Managerial accounting is mandatory while financial accounting is optional.
Answer
  • True
  • False

Question 18

Question
What are the 3 activities that managerial accounting helps managers carry out?
Answer
  • planning
  • financing
  • controlling
  • decision making
  • hiring

Question 19

Question
What does the planning aspect of managerial accounting include?
Answer
  • establishing goals and specifying how to achieve them (includes budgeting)
  • setting a structure for the company
  • gathering feedback to make new plan for running the company
  • planning is not relevant to managerial accounting

Question 20

Question
What is involved in the control aspect of managerial accounting
Answer
  • controlling is not relevant
  • it involves gathering feedback to ensure that plans are being followed. (involves performance reports that compare budgeting to actual results)
  • involves making budgets to follow
  • involves being a tyrannical boss.

Question 21

Question
What 3 questions does managerial decisions making revolve around?
Answer
  • Who are we?
  • What should we be selling?
  • Who should we be serving?
  • What is our budget?
  • How should we execute?
  • What purpose do we serve?

Question 22

Question
What is the IMA
Answer
  • International Management Association
  • Institue of Managerial Accounting
  • Institue of Management Accountants
  • International Money Association

Question 23

Question
What 2 things does the IMA's Statement of Ethical Professional Practice offer guidelines for?
Answer
  • Ethical Behavior
  • How to be a managerial accountant
  • Rules of managerial accounting
  • Resolution for an ethical conflict.

Question 24

Question
What are the 4 categories of guidelines for Ethical Behavior as defined by the IMA?
Answer
  • Competence
  • Confidentiality
  • Integrity
  • Credibility
  • Communication
  • Respectfulness

Question 25

Question
Which of the following does not fall under the category of Competency in IMA's guidelines for Ethical Behavior?
Answer
  • Recognize and communicate professional limitations that preclude responsible judgment.
  • Follow applicable laws, regulations, and standards.
  • Ensure that subordinates do not disclose confidential information.
  • Maintain professional competence.
  • Provide accurate, clear, concise, and timely decision support information.

Question 26

Question
Which of the following does not fall under the category of Confidentiality in IMA's guidelines for Ethical Behavior?
Answer
  • Do not disclose confidential information unless legally obligated to do so.
  • Ensure that subordinates do not disclose confidential information.
  • Refrain from conduct that would prejudice carrying out duties ethically.
  • Do not use confidential information for unethical or illegal advantage.

Question 27

Question
Which of the following does not fall under the category of Integrity in IMA's guidelines for Ethical Behavior?
Answer
  • Communicate information fairly and objectively.
  • Mitigate conflicts of interest and advise others of potential conflicts.
  • Abstain from activities that might discredit the profession.
  • Refrain from conduct that would prejudice carrying out duties ethically.

Question 28

Question
Which of the following does not fall under the category of Credibility in IMA's guidelines for Ethical Behavior?
Answer
  • Communicate information fairly and objectively.
  • Do not disclose confidential information unless legally obligated to do so.
  • Disclose all relevant information that could influence a user’s understanding of reports and recommendations.
  • Disclose delays or deficiencies in information timeliness, processing, or internal controls.

Question 29

Question
Contact with levels above the immediate supervisor should only be initiated with the supervisor's knowledge, assuming they are not involved.
Answer
  • True
  • False

Question 30

Question
If your immediate supervisor is the CEO who should you consider going to?
Answer
  • Board of directors/audit committee
  • You should just go to the CEO
  • Owner of Company
  • Government

Question 31

Question
If your superior is involved should you just let go of the conflict
Answer
  • True
  • False

Question 32

Question
An example of a direct material is:
Answer
  • Cleaning supplies for manufacturing machines
  • Glue for parts
  • Radio in a car
  • Oil for car engine

Question 33

Question
An example of Direct Labor would be wages paid to
Answer
  • Maintenance workers
  • Security guards
  • Assembly workers
  • Executive workers

Question 34

Question
What two things makeup Manufacturing Overhead?
Answer
  • Direct Labor
  • Indirect Labor
  • Indirect costs
  • Indirect materials

Question 35

Question
What is considered to be an indirect material
Answer
  • Cleaning supplies used in manufacturing plants
  • Car radio
  • Car Metal
  • Processing Chip in a computer

Question 36

Question
What is an example of Indirect Labor (costs)
Answer
  • Assembly line workers
  • Janitors
  • Executive workers

Question 37

Question
What are the 2 non manufacturing costs
Answer
  • Selling Costs
  • Administrative Costs
  • Direct Labor Costs
  • Materials Costs
  • Costs for janitors

Question 38

Question
Which of the following is not a selling cost?
Answer
  • Advertising
  • Shipping
  • Sales
  • Cost of finished goods warehouses
  • Cost of packaging an item

Question 39

Question
Which of the following is not an Administrative Cost?
Answer
  • Executive compensation
  • Salaries for plant workers
  • Secretarial costs
  • PR costs

Question 40

Question
Which is NOT a Product Cost?
Answer
  • Direct materials
  • direct labor
  • selling costs
  • manufacturing overhead

Question 41

Question
Which is NOT a period cost?
Answer
  • selling costs
  • labor costs
  • administrative costs

Question 42

Question
Product costs are recognized as expenses when the products are sold
Answer
  • True
  • False

Question 43

Question
Period costs are expensed on the income statement
Answer
  • True
  • False

Question 44

Question
When are period costs "incurred"?
Answer
  • When employees earn them
  • When employees are paid

Question 45

Question
Which of the following costs would be considered a period rather than a product cost in a manufacturing company?
Answer
  • Manufacturing equipment depreciation
  • Property taxes on corporate headquarters
  • Direct materials costs
  • Electrical costs to light the production facility
  • Sales commissions

Question 46

Question
What two things make up a prime cost?
Answer
  • Direct materials
  • Manufacturing overhead
  • Indirect labor
  • Indirect Materials
  • Direct Labor

Question 47

Question
What two things make up conversion costs?
Answer
  • Direct Materials
  • Manufacturing Over
  • Indirect Labor
  • Indirect Material
  • Direct Material

Question 48

Question
Variable costs vary in direct proportion to activity
Answer
  • True
  • False

Question 49

Question
Variable costs per unit do not remain constant as activity changes
Answer
  • True
  • False

Question 50

Question
As the level of the activity base increases, the total variable cost
Answer
  • decreases proportionately
  • increases proportionately

Question 51

Question
When activated rises, the fixed costs per unit,
Answer
  • decreases
  • increases

Question 52

Question
Committed Fixed Costs can be altered in the short-term.
Answer
  • True
  • False

Question 53

Question
Discretionary costs are long term.
Answer
  • True
  • False

Question 54

Question
Which of the following costs would be variable with respect to the number of cones sold at a Baskins and Robbins shop?
Answer
  • The cost of lighting the store
  • The wages of the store manager
  • The cost of ice cream
  • The cost of napkins for customers

Question 55

Question
Y=a+bX is the equation for:
Answer
  • Fixed Costs
  • Variable Costs
  • Mixed Costs
  • Total Costs

Question 56

Question
In the equation Y=a+bX, Y=
Answer
  • total mixed costs
  • total fixed costs (vertical intercept)
  • total variable costs per unit of activity (slope)
  • level of activity

Question 57

Question
In the equation Y=a+bX, a=
Answer
  • total mixed costs
  • total variable costs per unit of activity(slope)
  • total fixed costs (vertical intercept)
  • level of activity

Question 58

Question
In the equation Y=a+bX, b=
Answer
  • level of activity
  • total variable cost per unit of activity (slope)
  • total mixed costs
  • total fixed costs (vertical intercept)

Question 59

Question
In the equation Y=a+bX, X=
Answer
  • Total variable cost per unit (slope)
  • total fixed costs (vertical intercept)
  • total mixed costs
  • level of activity

Question 60

Question
Gross margin=
Answer
  • sales-cogs
  • cogs-sales
  • contribution margin-sales
  • sales+cogs
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