Wiley Chapter 1 assignment gyu questions

Question 1

In recent decades the Canadian and U.S. economies, in general, have shifted toward an emphasis on providing services rather than goods.

true or false

Answer 1

true

Question 2

Planning is the process of keeping the company’s activities on track.

true or false

Answer 2

false

Question 3

Managerial accounting applies to all types of business—service, merchandising, manufacturing, and to all forms of business organizations.

true or false

Answer 3

true

Question 4

Given the decision to employ straight-line amortization or a usage-based amortization method,

the management accountant’s need to report the most relevant economic information to external users will determine which method is used.

true or false

Answer 4

false

Question 5

Management accounting and financial accounting, while in the same field, are mutually exclusive disciplines.

true or false

Answer 5

false

Question 6

Decision making is an integral part of the planning, directing, and motivating functions, but not of the controlling function

true or false

Answer 6

false

Question 7

Activity-based costing is a method of allocating overhead costs to products

true or false

Answer 7

true

Question 8

Reports scrutinized by managerial accountants

a) do not include those focused on business subunits.
b) do not include non-financial data relevant to business decision making.
c) are highly aggregated.
d) are special purpose for specific decisions.

Answer 8

d) are special purpose for specific decisions.

Question 9

Which of the following is not an internal user?

a) corporate officers
b) staff employees
c) stockholders
d) department manager

Answer 9

c) stockholders

Question 10

Which of the following uses managerial accounting?

a) manufacturing and service entities, but not merchandising
b) profit-oriented businesses only
c) service, manufacturing, and merchandising entities
d) only manufacturing entities

Answer 10

c) service, manufacturing, and merchandising entities

Question 11

Which term describes managerial accounting reports?

a) GAAP reports
b) special-purpose
c) general-purpose
d) regulatory reports

Answer 11

b) special-purpose

Question 12

Which one of the following is true concerning the managerial function of controlling?

a) It includes performance evaluation by management.
b) It is concerned mainly with operating a manufacturing segment.
c) It is performed only by the controller of a company.
d) It includes hiring and training employees.

Answer 12

a) It includes performance evaluation by management.

Question 13

Directing includes

a) providing a framework for management to have criteria to terminate employees when needed.
b) running a department under quality control standards universally accepted.
c) coordinating a company’s diverse activities and human resources to produce a smooth-running operation.
d) developing a performance ranking system to give certain high performers good raises.

Answer 13

c) coordinating a company’s diverse activities and human resources to produce a smooth-running operation.

Question 14

The IMA’s Statement of Ethical Professional Practice provides codes of conduct with regard to:

a) competence, confidentiality, assurance and credibility.
b) confidentiality, integrity, credibility and responsibility.
c) comprehension, competence, integrity, and credibility.
d) competence, confidentiality, integrity and credibility.

Answer 14

d) Competence, confidentiality, integrity and credibility.

Question 15

Which of the following is true?

a) Managerial accountants are the employees who are principally responsible for ethical behaviour.
b) Investment losses have been precipitated by lax ethical standards.
c) Corporate fraud was found to have decreased between the years 1998 and 2003.
d) Expense account abuse has been cited as one of the rarest forms of unethical employee behaviour

Answer 15

b) Investment losses have been precipitated by lax ethical standards.

Question 16

Which is the best definition of fraud?

a) unknowingly misrepresenting the facts
b) using business supplies for personal use
c) the intentional misstatement of facts
d) misappropriating funds for personal financial gain

Answer 16

c) the intentional misstatement of facts

Question 17

The production manager at ABC Inc. is responsible for formulating the budget for his department. He will be evaluated on his ability to control costs. After considerable thought, he arrives at his best estimate of costs, and then adds a further 10% to the projections.

Chances are he has inflated the cost projections because

a) that is the way it has always been done.
b) conservative accounting practise requires that he not under report expenses.
c) by overestimating expenses, it will make it easier for him to come in under budget and receive a favourable evaluation.
d) none of the above.

Answer 17

c) by overestimating expenses, it will make it easier for him to come in under budget and receive a favourable evaluation.

Question 18

The Ontario Securities Commission introduced regulations governing the composition and duties of audit committees, as well as their members’ behaviour. The new rules

a) are as robust as parallel rules required by the U.S. Sarbanes-Oxley Act.
b) were adopted by all provincial and territorial securities regulators, except for British Columbia’s.
c) were introduced in conjunction with the Canadian Securities Administrators.
d) all of the above.

Answer 18

d) all of the above.

Question 19

A company acting ethically must adapt its internal reports to any changes required

a) instantly.
b) as it is appropriate for its business cycle.
c) as stipulated by the CPA Canada handbook and GAAP.
d) if they are considered pertinent to its business activities.

Answer 19

d) if they are considered pertinent to its business activities.

Question 20

Which one of the following managerial accounting approaches attempts to allocate manufacturing overhead in a more meaningful fashion?

a) theory of constraints
b) just-in-time inventory
c) activity-based costing
d) total-quality management

Answer 20

c) activity-based costing

Question 21

The theory of constraints is

a) a theory that the benefit of making a change in a production process should be weighed against the cost of making that change.
b) that even the best suggestions for improvement are likely to be rejected due to opposition from those who have to implement the changes.
c) a specific approach used to identify and manage constraints in order to achieve the company’s goals.
d) not applicable to service operations.

Answer 21

c) a specific approach used to identify and manage constraints in order to achieve the company’s goals.

Question 22

A balanced scorecard is

a) a performance-measurement approach that uses both financial and non-financial measures to evaluate a company’s operations in an integrated way.
b) a tool used to measure the benefits and costs of implementing a new strategy.
c) used only by small organizations that cannot afford more expensive methods of evaluating their operations.
d) focuses on non-financial measures in order to balance the many other financial reports companies use to evaluate their operations.

Answer 22

a) a performance-measurement approach that uses both financial and non-financial measures to evaluate a company’s operations in an integrated way.

Question 23

Managerial accounting has become more important in service industries due to

a) the decline of the manufacturing sector has freed up many accountants.
b) service delivery is extremely complex and requires proper monitoring.
c) the economy has become more service-oriented recently.
d) the increase in complexity in computer systems requires accounting specialists.

Answer 23

b) service delivery is extremely complex and requires proper monitoring.

Question 24

requires management to look ahead and to establish objectives. A key objective of management is to add value to the business.

Answer 24

planning

Question 25

involves coordinating a company’s diverse activities and human resources to produce a smoothly running operation. This function relates to the implementation of planned objectives.

Answer 25

directing

Question 26

is the process of keeping the activities on track. Management must determine whether goals are being met and what changes are necessary when there are deviations.

Answer 26

controlling

Question 27

A performance-measurement technique that attempts to consider and evaluate all aspects of performance using financial and non-financial measures in an integrated fashion

Answer 27

balanced scorecard

Question 28

The group of activities associated with providing a product or service

Answer 28

value chain

Question 29

an approach used to reduce the cost associated with handling and holding inventory by reducing the amount of inventory on hand

Answer 29

just in time inventory

Question 30

A method used to allocate overhead to products based on each product’s use of the activities that cause the incurrence of the overhead cost

Answer 30

activity-based costing