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CPA Quizlet for mah bibi > Cost Accounting V1 > Flashcards

Cost Accounting V1 Flashcards

1
Q

Financial accounting is most concerned with meeting the needs of internal users.

A

False

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2
Q

Financial accounting is most concerned with meeting the needs of external users.

A

True

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3
Q

Managerial accounting is most concerned with meeting the needs of internal users.

A

True

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4
Q

Financial accounting is most concerned with meeting the needs of external users.

A

True

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5
Q

Financial accounting is highly regulated by rules and regulations.

A

True

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6
Q

Managerial accounting is highly regulated by rules and regulations.

A

False

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7
Q

Financial accounting is most concerned with addressing the needs of the firm as a whole

A

True

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8
Q

Managerial accounting is most concerned with addressing the needs of the firm as a whole

A

False

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9
Q

Financial accounting is most concerned with addressing the needs of individual departments of the firm.

A

False

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10
Q

Managerial accounting is most concerned with addressing the needs of individual departments of the firm.

A

True

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11
Q

Cost accounting serves as a bridge between financial and managerial accounting.

A

True

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12
Q

The branch of accounting that is most concerned with addressing the needs of the firm as a whole is ___________________ accounting

A

Financial

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13
Q

The branch of accounting that is most concerned with addressing the needs of specific departments of the firm is ___________________ accounting

A

Managerial

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14
Q

The branch of accounting that serves as a bridge between financial and managerial accounting is __________ accounting.

A

Cost

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15
Q

When an organization attempts to “adjust” its profits to meet a specific target, it is guilty of ____________________________.

A

Earnings Management

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16
Q

The expression of what an organization wishes to accomplish and how it will serve its customers is contained in the __________________________.

A

Mission Statement

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17
Q

The plan in which an organization indicates how it will fulfill its goals is referred to as a __________.

A

Strategy

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18
Q

A function or activity in which an organization seeks to excel above its competitors is a ___________________________.

A

Core Competency

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19
Q

The way in which authority and responsibility are distributed in an organization is _________________________.

A

Organizational Structure

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20
Q

Outcomes that have resulted from past actions are also referred to as _________ indicators.

A

Lag

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21
Q

Data that reflects future financial and non-financial outcomes is referred to as ________ indicators.

A

Lead

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22
Q

In comparing financial and management accounting, which of the following more accurately describes management accounting information?
a. historical, precise, useful
b. required, estimated, internal
c. budgeted, informative, adaptable
d. comparable, verifiable, monetary

A

C. budgeted, informative, adaptable

23
Q

Management and financial accounting are used for which of the following purposes?

Management accounting Financial accounting

a. internal external
b. external internal
c. internal internal
d. external external

A

a. internal external

24
Q

One major difference between financial and management accounting is that
a. financial accounting reports are prepared primarily for users external to the company.
b. management accounting is not under the jurisdiction of the Securities and Exchange Commission.
c. government regulations do not apply to management accounting.
d. all of the above are true.

A

d. all of the above are true.

25
Q

Which of the following statements about management or financial accounting is false?
a. Financial accounting must follow GAAP.
b. Management accounting is not subject to regulatory reporting standards.
c. Both management and financial accounting are subject to mandatory recordkeeping requirements.
d. Management accounting should be flexible.

A

c. Both management and financial accounting are subject to mandatory recordkeeping requirements.

26
Q

Management accounting
a. is more concerned with the future than is financial accounting.
b. is less concerned with segments of a company than is financial accounting.
c. is more constrained by rules and regulations than is financial accounting.
d. all of the above are true.

A

a. is more concerned with the future than is financial accounting.

27
Q

Modern management accounting can be characterized by its
a. flexibility.
b. standardization.
c. complexity.
d. precision.

A

a. flexibility.

28
Q

Which of the following is not a valid method for determining product cost?
a. arbitrary assignment
b. direct measurement
c. systematic allocation
d. cost-benefit measurement

A

d. cost-benefit measurement

29
Q

Broadly speaking, cost accounting can be defined as a(n)
a. external reporting system that is based on activity-based costs.
b. system used for providing the government and creditors with information about a company’s internal operations.
c. internal reporting system that provides product costing and other information used by managers in performing their functions.
d. internal reporting system needed by manufacturers to be in compliance with Cost Accounting Standards Board pronouncements.

A

c. internal reporting system that provides product costing and other information used by managers in performing their functions.

30
Q

Cost accounting is directed toward the needs of
a. regulatory agencies.
b. external users.
c. internal users.
d. stockholders.

A

c. internal users.

31
Q

Cost accounting is necessitated by
a. the high degree of conversion found in certain businesses.
b. external reporting requirements for manufacturing companies.
c. management’s need to be aware of all production activities.
d. management’s need for information to be used for planning and controlling activities.

A

a. the high degree of conversion found in certain businesses.

32
Q

Financial accounting
a. is primarily concerned with internal reporting.
b. is more concerned with verifiable, historical information than is cost accounting.
c. focuses on the parts of the organization rather than the whole.
d. is specifically directed at management decision-making needs.

A

b. is more concerned with verifiable, historical information than is cost accounting.

33
Q

Financial accounting and cost accounting are both highly concerned with
a. preparing budgets.
b. determining product cost.
c. providing managers with information necessary for control purposes.
d. determining performance standards.

A

b. determining product cost.

34
Q

Which of the following topics is of more concern to management accounting than to cost accounting?
a. generally accepted accounting principles
b. inventory valuation
c. cost of goods sold valuation
d. impact of economic conditions on company operations

A

d. impact of economic conditions on company operations

35
Q

Cost and management accounting
a. require an entirely separate group of accounts than financial accounting uses.
b. focus solely on determining how much it costs to manufacture a product or provide a service.
c. provide product/service cost information as well as information for internal decision making.
d. are required for business recordkeeping as are financial and tax accounting.

A

c. provide product/service cost information as well as information for internal decision making.

36
Q

Which of the following statements is true?
a. Management accounting is a subset of cost accounting.
b. Cost accounting is a subset of both management and financial accounting.
c. Management accounting is a subset of both cost and financial accounting.
d. Financial accounting is a subset of cost accounting.

A

b. Cost accounting is a subset of both management and financial accounting.

37
Q

Which of the following statements is false?
a. A primary purpose of cost accounting is to determine valuations needed for external financial statements.
b. A primary purpose of management accounting is to provide information to managers for use in planning, controlling, and decision making.
c. The act of converting production inputs into finished products or services necessitates cost accounting.
d. Two primary hallmarks of cost and management accounting are standardization of procedures and use of generally accepted accounting principles.

A

d. Two primary hallmarks of cost and management accounting are standardization of procedures and use of generally accepted accounting principles.

38
Q

A managerial accountant who communicates information objectively is exercising which of the following standards?
a. objectivity c. competence
b. integrity d. confidentiality

A

a. objectivity

39
Q

A managerial accountant who prepares clear reports and recommendations after analyzing relevant facts is exercising which of the following standards?
a. objectivity c. competence
b. integrity d. confidentiality

A

c. competence

40
Q

Cost accounting standards
a. are legal standards set by the Institute of Management Accountants for use in all manufacturing and professional businesses.
b. are set by the Cost Accounting Standards Board and are legally binding on all manufacturers, but not service organizations.
c. do not exist except for those legal pronouncements for companies bidding or pricing cost-related contracts with the government.
d. are developed by the Cost Accounting Standards Board, issued by the Institute of Management Accountants, and are legally binding on CMAs.

A

c. do not exist except for those legal pronouncements for companies bidding or pricing cost-related contracts with the government.

41
Q

Which of the following U.S. legislation relates to bribes being offered to foreign officials?
a. Racketeer Influenced and Corrupt Organizations Act
b. Foreign Illegal Activities Act
c. Foreign Corrupt Practices Act
d. Federal Bribery and Corrupt Practices Act

A

c. Foreign Corrupt Practices Act

42
Q

The set of processes that convert inputs into services and products that consumers use is called
a. a core competency.
b. an operational plan.
c. the value chain.
d. the product life cycle.

A

c. the value chain.

43
Q

Core competencies are not
a. internal functions crucial to the success and survival of a company.
b. attributes that keep a firm from competing.
c. different for every organization.
d. considered influences on corporate strategies.

A

b. attributes that keep a firm from competing.

44
Q

A long-term plan that fulfills the goals and objectives of an organization is known as a(n)
a. management style.
b. strategy.
c. mission statement.
d. operational mission.

A

b. strategy.

45
Q

Which of the following areas is not addressed by an organization’s mission statement?
a. the purpose for which the organization exists
b. what the organization wants to accomplish
c. the organization’s strategic plan for fulfilling its mission
d. how its products can uniquely meet the needs of its customers.

A

c. the organization’s strategic plan for fulfilling its mission

46
Q

The world has essentially become smaller because of
a. improved technology.
b. trade agreements.
c. better communications systems.
d. all of the above.

A

d. all of the above.

47
Q

The value chain
a. reflects the production of goods within an organizational context.
b. is concerned with upstream suppliers, but not downstream customers.
c. results when all non-value-added activities are eliminated from a production process.
d. is the foundation of strategic resource management.

A

d. is the foundation of strategic resource management.

48
Q

In a global economy,
a. the trade of goods and services is focused on trade between or among countries on the same continent.
b. the international movement of labor is prohibited except for multilingual persons.
c. the international flows of capital and information are common.
d. all of the above happen in a global economy.

A

c. the international flows of capital and information are common.

49
Q

On what needs do (1) management accounting and (2) financial accounting focus?

A

Management accounting focuses on the needs of users inside an organization. Managers need information related to planning, controlling, decision making, and performance evaluation. Their needs are satisfied through the providing of information designed for their particular uses. Financial accounting focuses on the needs of users outside the organization, such as stockholders, creditors, and regulatory agencies. These users require information that is in conformity with generally accepted accounting principles and, thus, is standardized in the form of general purpose financial statements.

50
Q

What four areas are covered by the Standards of Ethical Conduct for Certified Management Accountants? How are these areas defined?

A

The four areas covered by the Standards of Ethical Conduct for Certified Management Accountants are: competence, confidentiality, integrity, and objectivity. Competence means having the capacity to function in a particular manner. Confidentiality means having the ability to maintain or keep information undisclosed. Integrity is defined as adherence to a code of moral values. Objectivity is defined as expressing or using facts without distortion by personal feelings or prejudices.

51
Q

What are the functions of a mission statement?

A

The mission statement expresses:
1. the purpose for which the organization exists.
2. what the organization wants to accomplish
3. how its products and services can uniquely meet its targeted customers’ needs.

52
Q

Distinguish between lead indicators and lag indicators, and provide an example of each. Which of these indicators is a better guide for strategic planning?

A

A lag indicator is an outcome that has resulted from past actions. A common lag indicator is profitability. Other similar performance measures are also acceptable answers.

A lead indicator reflects future financial and nonfinancial outcomes. A good example of a lead indicator would be the number of employees trained on a new transaction processing system. Lead indicators are better guides for strategic planning, because they provide information on outcomes more quickly than do lag indicators.

53
Q

Define value chain and provide a graphic of the interacting flows of information within the value chain.

A

The value chain is the set of processes that convert inputs into products and services for a firm’s customers. It includes both internal and external processes. It encompasses both upstream and downstream entities.

54
Q

List and explain the four perspectives of the balanced scorecard (BSC).

A

Learning and growth perspective–Focuses on using an organization’s intellectual capital to adapt to or influence changing customer needs.
Internal business perspective–Addresses those things that an organization needs to do well to meet customer needs and expectations.
Customer value perspective–Addresses how well the organization is doing relative to important customer criteria.
Financial perspective–Addresses the concerns of stakeholders about profitability and organizational growth.

CPA Quizlet for mah bibi (2 decks)

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