Chapter 1

Question 1

Characteristics of FINANCIAL Accounting

Answer 1

External Users, Historical, Objectivity & Verifiability, Precise, Company-wide and Regulated (GAAP & SEC)

Question 2

Characteristics of MANAGERIAL Accounting

Answer 2

Internal Users, Future focused, Relevance, Timely, Segments and Non- regulated

Question 3

3 Pillars of Managerial Accounting: Planning

Answer 3

Process of establishing goals and specifying how to achieve them

Question 4

3 Pillars of Managerial Accounting: Controlling

Answer 4

Process of gathering feedback to ensure that a plan is being properly executed or modified as circumstances change

Question 5

3 Pillars of Managerial Accounting: Decision Making

Answer 5

Selecting a course of action from competing alternatives

Question 6

Why have Ethical Standards?

Answer 6

If the standards are not followed in business, then the economy, and all of us would suffer. Abandoning ethical standards would lead to a lover standard of living with lower- quality goods and services, less to chose from and higher prices.

Question 7

Code of Conduct for Management Accountants:

Competence

Answer 7

Follow applicable laws, regulations and standards
Provide accurate, clear, concise & timely decision support info
Recognize & communicate professional limitations

Question 8

Code of Conduct for Management Accountants:

Confidentiality

Answer 8

Do not disclose confidential info unless legally obligated to do so
Ensure that subordinates do not disclose confidential info
Do not use confidential info for unethical or illegal advantage

Question 9

Code of Conduct for Management Accountants:

Integrity

Answer 9

Mitigate conflicts of interest & advise others of potential conflicts
Refrain from conduct that would prejudice carrying out duties ethically
Abstain from activities that might discredit the profession

Question 10

Code of Conduct for Management Accountants:

Credibility

Answer 10

Communicate information fairly and objectively
Disclose all relevant information
Disclose delays or deficiencies

Question 11

Corporate Social Responsibility

Answer 11

Organizations consider the needs of all stakeholders when making decisions (both needed for legal compliance & as voluntary actions).
Stakeholders include: customers, employees, suppliers, communities, stockholders, environmental & human rights advocates