MAC - Section End Questions All Correctly Answered

MAC - Section End Questions All Correctly Answered 1. Which of the following statements about management accounting is FALSE? a) Management accounting is the process of identifying, measuring, accumulating, analyzing, preparing, interpreting and communicating information. b) Management accounting helps managers fulfill organizational objectives. c) Management accounting is used by managerial accountants to make strategic and operational decisions. d) Management accounting produces information for managers in an organization. - Answer- c) Management accounting is used by managerial accountants to make strategic and operational decisions. 2. Which of the following should be considered in the selection of an accounting system? a) behavioral effects of the system on managers b) costs of buying and operating the system c) improved decision-making power resulting from the system d) All of the above - Answer- d) all of the above 3. When comparing management accounting and financial accounting, which of the following statements is FALSE? a) Management accounting has a future orientation whereas financial accounting has a past orientation. b) Management accounting prepares detailed reports whereas financial accounting prepares summary reports .c) Management accountants are constrained by the principles of reporting promulgated by the Institute of Management Accountants whereas financial accountants are constrained by Generally Accepted Accounting Principles. d) Behavioral considerations are of primary importance in management accounting, but not in financial accounting. - Answer- c) Management accountants are constrained by the principles of reporting promulgated by the Institute of Management Accountants whereas financial accountants are constrained by Generally Accepted Accounting Principles. 4. major internal users of accounting information are: a) management who use information for day-to-day operating decision b) investors for investment decision c) government authorities d) none of the above - Answer- a) managers who use information for day-to-day operating decisions 1. Janitors clean the factory with scrubbing machines and polishing machines. Scrubbing machines scrub the factory floor and polishing machines polish the floor. The cost associated with cleaning the factory is treated as a product cost. What is a good cost driver for the Depreciation Expense associated with the scrubbing and polishing machines? a) number of janitors operating machines b) number of labor hours put in by janitors c) number of kilowatt hours used d) number of machine hours used - Answer- d) number of machine hours used 2. Why is it important to identify the most appropriate cost drivers for a particular product? a) so managers can identify the activities necessary to manufacture a product b) so managers can control product costs better c) so managers can predict product costs better and make better decisions d) BandC - Answer- d) B andC 3. Within the relevant range, the total amount of ________ cost changes in direct proportion to changes in the cost driver. Within the relevant range, the total amount of ________ cost does not change in direct proportion to changes in the cost driver. a) fixed; variable b) variable; fixed c) step; mixed d) mixed; step - Answer- b) variable; fixed 4. As cost-driver level decreases in the relevant range, fixed costs per unit of cost driver ________, but total fixed costs ________. a) increase; do not change b) decrease: do not change c) do not change; increase d) do not change; decrease - Answer- a) increase; do not change