Test bank for cornerstones of cost accounting 1st edition by hansen

Test Bank for Cornerstones of Cost Accounting 1st Edition by
Hansen

In an accounting information system, which of the following is NOT a
transformational process?

1. collecting data
2. analyzing data
3. performance reporting
4. summarizing data
Which of the following is NOT a process associated with an accounting
information system?

1. auditing existing data


2. collecting and recording data
3. providing information to users
4. analyzing and managing data
In an accounting information system, the inputs are usually

1. financial statements.
2. analyzing data.
3. performance reports.
4. economic events.
_______________ is devoted to providing information for external users.

1. Management accounting
2. Financial accounting
3. Internal accounting
4. Cost accounting

Financial accounting information is used for

1. investment decisions.
2. regulatory measures.
3. stewardship evaluation.
4. all of these.


Which of the following is NOT part of the financial accounting information
system?

1. filing reports with the SEC
2. reporting a large contingent liability to current and potential shareholders
3. determining the future cashflows of a proposed flexible manufacturing
system
4. preparing GAAP financial statements
Which of the following does NOT describe cost management system?

1. evaluation of segments or products within the firm
2. emphasis on the future
3. externally focused
4. focus on effective use of resources
Cost management reports are prepared

1. to meet the needs of decision makers within the firm.
2. whenever stockholders request them.
3. according to guidelines prepared by the Securities and Exchange
Commission.
4. according to financial accounting standards.
Which of the following is NOT provided by cost accountants?

1. cost information in accordance with GAAP
2. cost information about processes and activities


3. financial information for external users
4. cost information about products, customers, and services
The primary objective of the cost management information system is to
provide

1. stockholders and potential investors with useful information for decision
making.
2. banks and other creditors with information useful in making credit decisions.
3. management with information useful for planning and control of operations.
4. the Internal Revenue Service with information about taxable income.
The cost management information system is concerned with

1. reporting financial information according to GAAP.
2. providing cost information that is used in planning, control, and decisionmaking.
3. reporting to external users.
4. providing financial information to investors.
Cost management is the branch of accounting concerned with reporting
to

1. internal managers.
2. stockholders.
3. the government.
4. bankers.

_______________ broadens the focus of accounting because it is concerned with
factors that drive costs, such as cycle time and process productivity.

1. Cost accounting
2. Cost management
3. Financial management
4. Financial accounting
Cost accounting

1. is concerned with assigning costs to various cost objects.
2. attempts to satisfy the costing objectives of both financial accounting and
management accounting. - Given
3. provides cost information that supports planning, controlling, and decision
making.
4. all of these.
Which of the following activities is NOT associated with the cost management
information system?

1. preparing a cost of quality report
2. preparing a performance report that compares actual costs to budgeted
costs - Given
3. determining the cost of a customer
4. using future expected earnings to estimate the price of a share of common
stock


Which of the following costing activities is associated with the financial
accounting system?

1. determining the cost of a department

2. determining the cost of goods sold for financial statements
3. preparing budgets
4. determining the cost of a customer
Which of the following activities is associated with the cost management
information system?

1. preparing reports for division managers
2. preparing reports for the IRS
3. preparing reports for the SEC
4. preparing financial statements that conform to GAAP
Which of the following activities is NOT associated with the financial
accounting information system?

1. reporting on the cost of quality
2. reporting to the SEC
3. preparing reports for the IRS
4. preparing a statement of cash flows


Which of the following is a cost management subsystem designed to assign
costs to individual products and services and other objects, as specified by
management

1. financial accounting information system
2. operational control system
3. cost accounting information system
4. all of the above
The operational control system is concerned with

1. investment decisions.

2. what activities should be performed and assessing how well they are
performed.
3. consumption of productive resources by individual products.
4. none of these.
Which of the following statements is TRUE?

1. The service sector comprises approximately 75 percent of the United States'
economy and employment.
2. The service sector comprises approximately 20 percent of the United States'
economy and employment.
3. Traditional smokestack industries have increased in importance in recent
years.
4. The service sector has decreased in importance in recent years.


Which of the following cost management tools supports the firm's
concentration on the delivery of value to the customer?

1. service industry growth
2. global competition
3. preparing an earnings report for the SEC
4. value-chain analysis
Factors that have led to a global market for manufacturing and service firms
are

1. improved transportation and communications systems.
2. improved telemarketing and communications.
3. improved distribution and transportation systems.
4. None of these factors have contributed.
A(n) ________________ is a computerized information system that strives to input

data once and make it available to people across the company for different
purposes

1. cost management information system
2. enterprise resource planning system
3. internal accounting system
4. financial accounting system


Which of the following is NOT an advance in information technology that
affects firms?

1. computer integrated applications
2. GAAP reporting
3. emergence of electronic commerce
4. availability of tools such as OLAP and DSS
Software that has integrated system capability using real time data is

1. enterprise resource planning software.
2. on-line analytic programs.
3. computer-assisted engineering software.
4. none of these.
The increased importance of costing our activities in the value chain and
determining the cost of different suppliers and customers has led to the
emergence of

1. OLAP.
2. EDI and supply chain management.
3. CAM.
4. theory of constraints.

____________________ is any form of commerce that is executed using information
and communications technology.

1. ERP


2. OLAP
3. electronic commerce
4. DSS
Which of the following activities is NOT significant to the advancement of
information technology?

1. enterprise resource planning software
2. emergence of electronic commerce
3. theory of constraints
4. decision support systems
Automation of the manufacturing environment is associated with increases
in

1. inventory.
2. productive capacity.
3. processing time.
4. none of these.
Which of the following approaches have led to advancements in the
manufacturing environment?

1. theory of constraints
2. computer-integrated manufacturing
3. JIT manufacturing
4. all of these

In JIT manufacturing, each operation produces

1. only what is necessary for the succeeding operations.
2. all that it can to offset fixed costs.
3. a fixed percentage in excess of orders to ensure adequate quality stock.
4. all that it can in order to build inventories.
Which of the following emerging trends in cost accounting deals with
managers striving to create an environment that will enable workers to
manufacture perfect (zero-defect) products?

1. advances in information technology
2. time as a competitive element
3. global competition
4. total quality management
Competitive advantage is established by providing

1. more customer products than competitors.
2. better quality than competitors. - Given
3. greater customer value for less cost than competitors.
4. greater efficiencies than competitors.
Which of the following activities is NOT associated with strategic analysis and
new product development?

1. life-cycle costing
2. target costing


3. activity-based management - Given

4. performance reports
Total quality management emphasizes

1. zero defects.
2. continual improvement.
3. elimination of waste.
4. all of these.
Cost management information systems further competitive advantage by
supporting three fundamental organizational goals. Which of the following is
NOT one of these fundamental organizational goals that further competitive
advantage?

1. improved time-based performance
2. improved quality of products and services
3. maximizing shareholder value
4. improved efficiency
Which of the following statements is NOT true about world-class firms?

1. World-class firms are firms that are poor in customer support.
2. World-class firms know their market and their products.
3. World-class firms strive continually to improve product design, manufacture,
and delivery.
4. World-class firms can compete with the best of the best in a global
environment.


Improvement in time performance is most likely NOT enhanced by

1. redesign of products.
2. adding processes in production.

3. eliminating waste.
4. eliminating non-value-added activities.
A critical measure of efficiency is

1. the cost of activity.
2. a T-test.
3. customer satisfaction.
4. employee job satisfaction.
Today's cost managers must assemble cost information and determine how to
value things. Which methods would NOT be critical to achieving this?

1. foreign currency translation
2. costing and quality analysis - Given
3. differentiating between value-added and non-value-added activities
4. measuring productivity
A person in a staff position

1. is directly involved in production.
2. provides support for the line function.
3. is not actually an employee of the company.


4. all of these.
Which of the following is a staff position?

1. vice president of production
2. vice president of finance
3. vice president of marketing
4. plant foreman - Given
The internal auditor performs a

1. line function.
2. staff function.
3. production function.
4. marketing function.
Which of the following positions would most likely be a line manager?

1. personnel department manager
2. president
3. treasurer
4. purchasing department manager
Which of the following positions would most likely be a staff manager?

1. manager of a Sears store
2. president
3. manager of a clothing division


4. controller
All of the following would be considered staff functions EXCEPT the

1. vice president of finance.
2. vice president of corporate planning.
3. vice president of marketing.
4. vice president of research and development.
Which of the following would be considered a line function?

1. production
2. maintenance
3. public relations

4. administrative services
Which of the following job positions is a line function?

1. financial vice president
2. controller
3. production supervisor
4. treasurer
Which of the following job positions is a staff position?

1. controller
2. production vice president
3. production supervisor


4. assembly foreman - Given
Accounting activities within an organization are usually under the overall
supervision of the

1. Certified Public Accountant.
2. controller.
3. Chartered Accountant.
4. treasurer.
The chief accounting officer of an organization is the

1. vice president of finance.
2. internal auditor.
3. treasurer.
4. controller.
The _______________ is the officer responsible for money management and
serves chiefly as the custodian of the organization's funds.

1. Certified Public Accountant
2. controller
3. Chartered Accountant
4. treasurer
Which of the following duties is usually assigned to the controller?

1. receiving, maintaining custody of, and disbursing monies and securities


2. directing the granting of credit to clients
3. investing the organization's funds
4. tax planning
Currently, the activity found LEAST often within the controller's department
is

1. updating the general ledger.
2. budget preparation.
3. maintaining accounts receivable records.
4. establishing and maintaining a market for the organization's debt and equity
securities.
Analyzing cost overruns to determine their cause is an example of

1. planning.
2. control.
3. decision making.
4. both a and c.
Monitoring the number of defects produced is an example of the management
function of

1. planning.
2. control.
3. decision making.
4. both a and c.


The setting of objectives and the identification of methods to achieve those
objectives is called

1. planning.
2. controlling. - Given
3. performance evaluation.
4. decision making.
Comparing actual quality costs with planned quality costs is an example
of

1. planning.
2. controlling.
3. performance evaluation.
4. both b and c.
Performance reports are accounting reports that compare

1. planned data with actual data.
2. audited data with actual data.
3. managers' bonuses with performance ratings by supervisors.
4. actual data with industry standards.
Setting the company's profit targets for the upcoming year is an example of
the management function of

1. planning.

2. control.


3. variance analysis.
4. internal auditing. - Given
Developing a company strategy for responding to anticipated new markets is
an example of

1. planning.
2. control.
3. decision making.
4. all of these.
The planning process includes

1. setting objectives.
2. identifying means of achieving the objectives.
3. making decisions.
4. all of these.
Investigating production variances and adjusting the production process is an
example of

1. planning.
2. control.
3. internal auditing.
4. both a and c.


Evaluating the performance of a segment of the company is an example
of

1. planning.
2. control.
3. internal auditing.
4. both a and c.
The formulation of a program for the accomplishment of a specific purpose is
referred to as

1. controlling.
2. motivating.
3. organizing.
4. planning.
The manager has to decide what tasks are needed and how they should be
accomplished. This statement describes

1. the organization chart.
2. planning.
3. organizing.
4. none of these.
In a performance report,

1. differences between actual costs and allowed costs are always undesirable. Given


2. expenditures of less than allowed amounts are undesirable.
3. expenditures of more than allowed amounts are not permitted to occur.
4. expenditures of less than allowed amounts are desirable.
The monitoring of a plan's implementation is called

1. planning.
2. controlling.

3. decision making.
4. budgeting.
Inspecting units produced to determine if they meet specifications is an
example of

1. planning.
2. control.
3. decision making.
4. both a and c.
Continuous improvement is

1. critical in a dynamic environment.
2. important to finding and maintaining a competitive advantage.
3. an effort to find ways to increase overall efficiency, improve quality, and
reduce costs.
4. all of these.


Which of the following describes the managerial activity of comparing actual
results with budgeted results?

1. control
2. continuous improvement
3. planning
4. decision making
Managers are considering outsourcing subcomponents of production. Data is
collected about the costs of making the subcomponent. Different bids are
sought about the purchase of the subcomponents. Which managerial activity
is applicable in this situation?

1. control
2. continuous improvement
3. planning
4. decision making
In a company, engineers have redesigned production process lowering
production costs, shorting production cycle time, reducing waste and
improving quality. Which type of managerial activity applies to this
situation?

1. controlling
2. continuous improvement - Given
3. planning
4. decision making


Determining the bid your company should submit on a construction contract
is an example of

1. planning.
2. control.
3. decision making.
4. both a and b.
Setting the selling price of a company's product is an example of

1. planning.
2. control.
3. decision making.
4. all of these.
Principles of personal ethical behavior include

1. integrity.
2. respect for others.
3. fairness.
4. all of these.
Which of the following have been found to be TRUE?

1. Firms that emphasize ethics outperform firms that don't emphasize ethics.
2. Those corporations that mention ethics in their management reports have
lower than average performance.


3. Companies with a strong code of ethics and sense of integrity and honor will
have trouble competing over the long run.
4. All of these.
The standards of ethical conduct for management accountants include

1. competence and performance.
2. integrity and respect for others.
3. confidentiality, confidence, integrity, and observance.
4. competence, confidentiality, integrity, and credibility.
Extending the close of the fiscal year beyond December 31 so that some sales
of next year are included in the current year would be a violation of which
standard of ethical conduct for management accountants?

1. competence
2. confidentiality
3. conformance
4. all of these
Altering dates of shipping documents of next January's sales to record them
as sales in the current year would be a violation of which standard of ethical

conduct for management accountants?

1. competence
2. integrity
3. credibility
4. all of these


The acceptance of a savings bond from a supplier would be a violation of
which standard of ethical conduct for management accountants?

1. confidentiality
2. integrity
3. reliability
4. none of these
In resolving an ethical conflict, it is inappropriate to discuss the problem with
the immediate supervisor because of a violation of which standard of ethical
conduct for management accountants?

1. competence
2. confidentiality
3. credibility - Given
4. This action is not in violation of the code of conduct.
In resolving an ethical conflict, which of the following would NEVER be
appropriate?

1. discussing the matter with the chief executive officer
2. discussing the matter with an external member of the board of directors
3. taking the matter to the press where there is no legal requirement
4. resigning from the position because of a conflict