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Cost Accounting, > Topic 1 (Ch. 1-3) > Flashcards

Topic 1 (Ch. 1-3) Flashcards

1
Q

The set of activities that transforms raw resources into the goods and services end users
purchase and consume is called the:

A. value chain.
B. supply chain.
C. demand chain.
D. cost-benefit analysis.

A

A.

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2
Q
  1. Which of the following activities would not be considered a value-added activity?

A. Production
B. Marketing
C. Accounting
D. Distribution

A

C.

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3
Q
  1. Which of the following statements is false?

A. In essence, the value chain and the supply chain are similar; each creates something for
which the customer is willing to pay.
B. Financial accounting information is important because it is sufficient to provide all the
information for operational decisions commonly made by managers.
C. The supply or distribution chain is a linked set of organizations that exchange goods and
services in combination to provide a final product or service to the customer.
D. Eliminating nonvalue-added activities always reduces costs without affecting the value of
the product to customers.

A

B.

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4
Q
  1. Managers do not make decisions about future events based on:

A. Perfect information.
B. Estimated information.
C. Actual information.
D. Financial information.

A

A.

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5
Q
  1. Which of the following is a nonvalue-added activity?

A. Product design
B. Customer service
C. Research and development
D. Rework of defective items

A

D.

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6
Q
  1. (CMA adapted) A costing method that first assigns costs to activities and then assigns them to
    products based on the products’ consumption of those activities is:

A. full-absorption costing.
B. activity-based costing.
C. variable costing.
D. benchmarking.

A

B.

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7
Q
  1. (CMA adapted) Cost drivers are

A. activities that cause costs to increase as the activity increases.
B. accounting techniques and practices used to control costs.
C. accounting reimbursements used to evaluate whether performance is proceeding
according to plan.
D. a mechanical basis, such as machine hours, computer time, or factory square footage,
used to assign costs to activities.

A

A.

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8
Q
  1. (CMA adapted) The process of creating a financial plan of the revenues and resources
    needed to carry out activities and meet financial goals is referred to as:

A. budgeting.
B. benchmarking.
C. cost-benefit analysis.
D. value-added analysis.

A

A.

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9
Q
  1. The field of accounting that reports according to generally accepted accounting principles
    (GAAP) is called:

A. cost accounting.
B. financial accounting.
C. managerial accounting.
D. responsibility accounting.

A

B.

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10
Q
  1. The field of accounting that focuses on the criterion of relevant information rather than
    comparability of firms is:

A. Cost accounting
B. Financial accounting
C. Responsibility accounting
D. International accounting

A

A.

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11
Q
  1. The just-in-time (JIT) method of production focuses on

A. increasing sales revenue.
B. reducing inventories.
C. increasing customer service.
D. reducing operating expenses.

A

B.

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12
Q
  1. (CIA adapted) The primary reason for adopting total quality management (TQM) is to achieve

A. reduced delivery time.
B. reduced delivery charges.
C. greater customer satisfaction.
D. greater employee participation.

A

C.

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13
Q
  1. According to the Institute of Management Accountants (IMA), the final step in resolving an
    ethical dilemma is to

A. consult your own attorney as to legal obligations and rights concerning the ethical conflict.
B. clarify relevant ethical issues by initiating a confidential discussion with an IMA Ethical
Counselor, an appropriate and confidential ethics hotline, or other impartial advisor.
C. consult with the local police.
D. discuss the situation with an immediate supervisor.

A

A.

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14
Q
  1. According to the Institute of Management Accountants (IMA), the first step in resolving an
    ethical dilemma is to

A. consult your own attorney as to legal obligations and rights concerning the ethical conflict.
B. call the IMA’s ethics hotline.
C. clarify relevant ethical issues by initiating a confidential discussion with an IMA Ethical
Counselor or other impartial advisor.
D. discuss the situation with an immediate supervisor, except when it appears that the
supervisor is involved, or with the next level supervisor, if involvement of the immediate
supervisor is suspected.

A

D.

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15
Q
  1. Which of the following is not one of the basic standards of the Institute of Management
    Accountants (IMA) Code of Ethics?

A. Competence
B. Confidentiality
C. Honesty
D. Integrity

A

C.

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16
Q
  1. Which of the following is not one of the overarching ethical principles of the Institute of
    Management Accountants (IMA) Code of Ethics?

A. Competence
B. Responsibility
C. Honesty
D. Objectivity

A

A.

17
Q
  1. A general term for a metric that indicates how well an individual, business, product, or firm is
    working is called

A. a performance measure.
B. benchmarking.
C. a budget.
D. a responsibility center.

A

A.

18
Q
  1. The cost accounting system that minimizes wasteful or unnecessary transaction processes is

A. performance measure.
B. benchmarking.
C. budgeting.
D. lean accounting.

A

D.

19
Q
  1. Continual process of measuring a company’s own products, services or activities against
    competitors’ performance is

A. performance measure.
B. benchmarking.
C. budgeting.
D. responsibility center.

A

B.

20
Q
  1. The costing method that first assigns costs to activities and then assigns them to products
    based on the products’ consumption of activities is called

A. lean accounting.
B. responsibility centers.
C. activity-based costing.
D. budgeting.

A

C.

21
Q
  1. Having one or more of the firms’ activities performed by another firm or individual in the supply
    or distribution chain is called

A. lean accounting.
B. responsibility centers.
C. activity-based costing.
D. outsourcing.

A

D.

22
Q
  1. Systems that identify the costs of producing defective units as well as low-quality items that
    lose sales are called

A. customer relationship management systems.
B. distribution chains.
C. enterprise resource planning systems.
D. cost of quality systems.

A

D.

23
Q
  1. Systems that allow firms to target profitable customers by assessing customer revenue and
    costs are called

A. customer relationship management systems.
B. distribution chains.
C. enterprise resource planning systems.
D. cost of quality systems.

A

A.

24
Q
  1. Information technology that links the various processes of the company into a single
    comprehensive information system is called

A. a customer relationship management system.
B. a distribution chain.
C. a cost of quality system.
D. an enterprise resource planning system.

A

D.

25
Q
  1. A management method by which the organization seeks to excel on all dimensions of quality
    is called

A. customer relationship management.
B. a just-in-time method.
C. total quality management.
D. cost of quality.

A

C.

26
Q
  1. Which of the following is not a key financial manager in an organization?

A. Chief financial officer
B. Treasurer
C. External auditor
D. Controller

A

C.

27
Q
  1. Which of the following is not normally considered part of the value chain?

A. Research and development
B. Purchasing
C. Administration
D. Distribution

A

C.

28
Q
  1. Moving of inventory is an example of a(n):

A. cost-benefit analysis.
B. value-added activity.
C. activity-based cost.
D. nonvalue-added activity.

A

D.

29
Q
  1. Costs that differ among or between two or more alternative courses of action are

A. differential costs.
B. cost-benefit analysis.
C. activity-based costs.
D. cost drivers.

A

A.

30
Q
  1. Which of the following activities would not be included in the value chain of a manufacturing
    company?

A. Research and Development
B. Customer Service
C. Design
D. Accounting

A

D.

31
Q
  1. A firm’s replies to customers’ questions via email would be an example of which element of the
    value chain?

A. Customer Service
B. Marketing
C. Design
D. Supply

A

A.

32
Q
  1. The delivery of products or services to customers is an example of which element in the value
    chain?

A. Production
B. Design
C. Marketing
D. Distribution

A

D.

33
Q
  1. Which of the following provides much of the information necessary for the coordination of the
    value chain?

A. the distribution chain.
B. the financial accounting system.
C. the cost accounting system.
D. the supply chain.

A

C.

34
Q
  1. Advertising costs would be associated with which of the following value chain components?

A. Production.
B. Research and Development.
C. Distribution.
D. Marketing and sales.

A

D.

35
Q
  1. Which part of the value chain is outside the firm?

A. The Design component
B. The Research and Development component
C. The Production activity
D. The Distribution chain

A

D.

Cost Accounting, (8 decks)

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